The Year of Financial Advisor Transformation

The Year of Financial Advisor Transformation

As we enter 2015, the S&P 500 is likely to be up over the last year (up 10 percent as of Dec. 11, 2014). Accordingly, affluent investors are more optimistic about their family’s financial situation despite concerns about taxes, health care and all the political gridlock in Washington.

Between 50 and 60 percent of affluent individuals tell us they have a primary financial advisor. That’s a lot of assets being held away from advisors. And the majority of today’s affluent report having no official wealth transfer plan in place and no provision for long-term care.

Yet affluent investors would prefer to have one primary financial advisor who oversees the multi-dimensional aspects of their family’s financial affairs, according to Oechsli Institute research.

Despite all of this, too many financial advisors continue to equate their value with portfolio performance. It’s all about investments and the market. One major flaw in this reasoning: When the S&P climbs 12 percent and portfolios rise accordingly, affluent clients don’t credit their financial advisor.

For advisors to capture more affluent business and demonstrate their value beyond performance, they’ll have to transform their business. Here are four steps to making 2015 the year of Financial Advisor Transformation:

Step 1: 360° Review

  • Starting with your team, you want an honest assessment of your client experience, services provided, service models, client communication, and marketing.
  • Next, you want to interview your top clients face-to-face in a conversational manner to determine: the value they perceive you’re delivering; their communication preferences (frequency and type—face-to-face, phone, email, etc.); what other areas, if any, for which they’d like advice; and what, if anything, could be improved upon.
  • Finally, have a conversation with your professional referral alliance partners (CPAs, JDs, etc.) similar to what you had with your top clients.

Step 2: Make Necessary Adjustments

  • Add new platforms, solutions, outside experts—whatever is required for you to truly perform the role of primary financial advisor for your top clients.
  • Personalize all top client communication, and create communication guidelines for your team that will be strictly followed.
  • Expand all affluent client relationships from business to social.
  • Revise roles and areas of responsibility as needed.
  • Develop a clear marketing plan focused on affluent client acquisition.
  • Create metrics to measure all the above.

Step 3: Implementation

  • Inspect what is expected. Change is difficult because we are creatures of habit.
  • Cover your 2015 transformative game plan as an agenda item at each weekly team meeting.
  • Your senior financial advisor must either lead by example or empower a junior financial advisor to take ownership of the process.

Step 4: Follow-up/Accountability

  • Discussion regarding the transformation process at weekly team meetings is essential.
  • Each individual must be able to report quantifiable progress.
  • Quarterly individual performance reviews for each team member brings accountability to a personal level.
  • Hold a quarterly team meeting offsite to check on overall progress. This can be held at a conference room in a restaurant, a library meeting room—it  doesn’t matter, as long as you get out of the office.

No financial advisor is going to transform his or her business overnight. Think in terms of one client at a time, one professional referral alliance partner at a time, and an ongoing commitment to raising the bar
over time.

The beauty of all this? Nearly every financial advisor is capable. So let’s make 2015 the year of Financial Advisor Transformation.

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