You may be doing it wrong.
Think about your last presentation to an important prospect, such as a retirement plan, foundation, endowment or personal trustee. What was your message? Chances are you may have used fear, uncertainty or doubt to influence them (three factors sometimes taken together as “FUD.”) You’d know if you said things like this:

“Do you know that you may be held personally liable for shortfalls and omissions to your fiduciary process?”
That’s fear.

“I’m not sure your decision-making process will measure up to fiduciary standards.”

That’s uncertainty.

“Your current advisor has not acknowledged fiduciary responsibility, and may not be putting your interests first.”

That’s doubt. 

I recently read the book Selling to the C-suite by Nicholas A.C. Read and Stephen J. Bistritz (published by McGraw-Hill).
The title, referring to a company’s chief officers, attracted my attention because I’ve been looking at ways advisors should broaden and deepen the relationships they have with their key institutional clients. They need to be a trusted advisor to the highest-level executives, not just members of the investment committee. The book also talks about using fear, uncertainty and doubt as the “old-school” style of marketing, an approach no longer welcomed nor effective with key decision-makers. They want you to bring solutions, not additional problems.

The authors conducted three studies between 1999 and 2005 with key executives from both the U.S. and Asia, asking each to identify the factors critical for building credibility with the executive suite. They found 13 factors, but I can reduce the number to nine, since four factors could simply be categorized as “understanding the executive’s business.”

The nine necessary factors I’ve identified, in order of importance, are the advisor’s:

1. Ability to marshal resources.
2. Understanding of the client’s business.
3. Responsiveness to client requests.
4. Willingness to be held accountable.
5. Ability to solve problems.
6. Ability to work well with client’s staff.
7. Industry knowledge.
8. Track record of accomplishments.
9. Length of time on the job.

If you’ve been following my articles lately, you might have seen me focus more on leadership and effective decision-making than on fiduciary responsibility. I believe that the only way we’re going to restore the public’s trust in the financial services industry is through a greater emphasis on leadership and stewardship. More rules and regulations, even if they are tied to fiduciary standards, will have minimal impact.

When you take the nine factors identified in the studies and superimpose them on a graph in which “Leadership” is the x-axis, and “Decision-making” is the y-axis, the result is what you see in Figure 1.

Note that “fear, uncertainty and doubt” never made it to the list. If you want to build credibility with a prospect or a client, you don’t do it that way. If you want to broaden and deepen your relationship with a key client, then you must:

1. Demonstrate your ability to marshal resources needed to support the client’s business, whether the resources and expertise are acquired through a virtual cooperative or drawn from your own organization. In today’s complex business world, you don’t want to give the impression that you’re a lone wolf.

2. Demonstrate an understanding of the client’s business—his industry sector, products, services, business drivers and competitors. As Read and Bistritz write in Selling to the C-Suite, “Focusing solely on the sale—with no context of how a solution benefits the customer’s world—will create the view that the salesperson is interested only in the commission.”

3. Be responsive to requests made by the client, and deliver on all your promises.

4. Be willing to accept accountability for your work. Executives realize that mistakes happen. What they want to know is that you have the professional integrity to take ownership of problems (whether you made the mistakes or not) and that you will take the initiative to marshal the resources necessary (back to the first point) to fix the problem.

By using fear, uncertainty and doubt, you illustrate the differences between leadership and management. Mostly, the fear strategies are about management: “Here are the rules. This is what I can do (and what your current advisor cannot do) to ensure that you stay compliant with the rules.” There is nothing inspiring about that strategy.

To stand out, you need to lead. You need to demonstrate that you have the ability to marshal the resources required to support the unique requirements, goals and objectives of the client’s organization.

Consider the folktale I came across on the blog “Linked 2 Leadership.” It’s the story of a repairman who was called to a factory to see if he could fix an old broken boiler.

The repairman listened as the factory manager described the problems with the broken boiler, asked a few questions and then went off on his own to examine the boiler. After a while, the repairman pulled out his hammer and tapped the broken boiler in one particular place; with that, the boiler came back to life.

The factory manager was amazed and asked the repairman to send him a bill for his services. Several days later, an invoice arrived for $1,000. The factory manager was taken aback by the fee—after all, the repairman had only to tap on the boiler once to fix the problem. So he asked the repairman for a breakdown of his fees.
He received an itemized invoice:

Use of hammer.$1.00
Knowing where to tap. $999.00

The C-suite wants proof that you know where to tap. A presentation focused on fear demonstrates only that you know how to wield a hammer. That focus does not give a prospect a sense of your leadership and decision-making skills, and these are key elements if you want to broaden and deepen your relationship with the C-suite.

Donald B. Trone, GFS™ is the president of the newly constituted Leadership Center for Investment Stewards, and is the founder and CEO/Chief Ethos Officer of 3ethos. He is the former director of the Institute for Leadership at the U.S. Coast Guard Academy; founder of the Foundation for Fiduciary Studies; and principal founder of fi360.