Whether you're a veteran trying to organize a team or a rookie with production problems, broker coaches are pros at finding trouble.
If you cringe at the thought of "systematizing your business" or zone out whenever someone mentions "unique value propositions," having a conversation with a broker coach might be a bit uncomfortable.
Broker coaches speak a language loaded with these kinds of expressions. But if you can get past the jargon, you'll find these professional troubleshooters can actually walk the walk as well as talk the talk. They solve real, tangible problems for brokers all over the country.
A coach is not for everyone. But for the three reps profiled in this story, working with a coach has sharpened their skills and boosted production. And that's a language every producer can understand.
Trouble: Stagnant Production
Broker: Patrick Calkins, Dain Rauscher, Oak Brook Terrace, Ill.
Coach: Joe Lukacs, International Performance Group, Melbourne, Fla.
Details: Calkins' production was stuck at $240,000 and his assets under management at $13 million. His branch manager was breathing down his neck in November 1999 when he contacted Lukacs. "After 10 years in the business, Pat was not on the fast track by any stretch of the imagination," Lukacs says.
Game Plan: First, Calkins was asked to list his three biggest challenges. That was easy. Calkins needed to increase assets under management, boost his production and meet his branch manager's ultimatum. He also wanted to become a true "professional," Lukacs says.
But Calkins had no business plan and didn't know what daily steps he needed to take to grow his book. With guidance from Lukacs, Calkins set a goal of expanding assets under management to $23 million by the end of 2000 and adopted several strategies from Lukacs.
First, Calkins vowed to ask for referrals from five clients every day and to schedule at least three client meetings each week.
Next, Calkins aimed to increase business from existing clients by turning each service call into a marketing call. "When a client calls with a question on his statement, thank him for his business, ask for a referral and ask if there's any other business you can do together," Lukacs says.
Calkins cleaned up his tardiness. Lukacs told him to arrive at the office every morning by 7:30 instead of wandering in at 8:30 or 9. "As simple as it sounds, there is a direct correlation between earnings and the amount of time spent in the office," Lukacs says.
And before the phones started ringing, Calkins was to review his 2000 business plan and daily game plan every morning. "I've seen a lot of people put together great business plans but never accomplish them," Lukacs says. "What they needed to do was never translated into a daily action plan."
Lukacs also helped Calkins find educational resources within his firm and taught him to use the Top Producer software program he owned. "Brokers think buying this stuff cures their problems, but they never learn how to use it, or they use 10% of it," Lukacs says.
"You are the business," he says. "If you want your business to move to the next level, you have to get there first."
Bottom Line: Calkins hopes to generate $390,000 in gross production in 2000 - a 62% increase from 1999. Assets had jumped to $20.1 million already by August.
"Every broker knows what he needs to do to improve his performance," Calkins says. "But Joe brought accountability into my business. I can be totally honest with him. If I golfed three days last week, I can tell him that. Today, I am accountable to myself."
Trouble: Referral Drought
Broker: Scott Wood, True North Advisors, Dallas
Coach: Steve Saenz, Paragon Resources, Atlanta
Details: Wood contacted Paragon Resources in 1997 after leaving Chase Manhattan Investment Services and joining Lockwood Financial as an employee in Lockwood's Dallas office.
Wood was a 29-year-old producer with five years under his belt. He was generating $450,000 annually with $45 million in assets under management. Most of his high-net-worth clients were using professional money managers.
Wood was already flourishing, but he wanted more. His goal: $150 million in assets within five years. But he had no formal business plan, no marketing plan and no client leads trickling in from Chase.
Game Plan: With Saenz's coaching, Wood took action. He scheduled one client referral meeting each week. "I explain our vision - where we're going, what we're trying to do, the type of client we're trying to attract," Wood says. "And then I enlist their help so they can be on the lookout for people we can work with."
Wood conducted at least one breakfast or lunch meeting each week with another professional adviser, such as an insurance agent, estate planning attorney or CPA. He explained his practice and asked questions about their businesses.
"In the beginning, there was a lot of anxiety about these meetings," Wood says. "I wasn't so sure they wanted to see me." But one of those early meetings resulted in a $1.5 million referral. "It will happen. You just have to kiss some frogs."
Wood added team members as the business expanded, including someone to write proposals. His team now includes operations manager Marie Reed and researcher Matt Fitzsimmons. Another marketing person is scheduled to join the group in January 2001.
He also clarified team roles, set expectations for each member and scheduled team meetings. "This is important, even when there are only two people on the team," Saenz says.
Then, Wood started targeting larger accounts and raised his minimum to $1 million. "When you start focusing on getting in front of that business, you start getting that business," Saenz says. "The dream book is about 70 clients."
He also took time to focus on goals. Fridays are "strategy days" at True North Advisors, when Wood and his colleagues focus on tasks and planning that benefit the practice somewhere down the road. "Most guys won't take that kind of time away from clients," Saenz says. "It's a paradox, but it does work."
Wood says it's an important step away from micromanagement. "We don't work in the business on Friday, we work on the business."
Bottom Line: On July 1, Wood formed his own RIA firm, True North Advisors, clearing through Lockwood. Client assets have grown to $180 million over the past three years since he contacted Saenz, already surpassing his five-year goal of $150 million. He's on track for $200 million by the end of 2000, Wood says. Office revenue is about $1.7 million, and average account size is now several million dollars.
"We spend a lot of time in our office focusing on big picture issues, such as where we want to go in the next five years and the next 10 years," Wood says. "I don't think I really knew what to focus on before working with Steve."
Trouble: Commission Quagmire
Broker: Rob Krebs, Merrill Lynch, Virginia Beach, Va.
Coach: Matt Oechsli, The Oechsli Institute, Greensboro, N.C.
Details: Since he was already generating more than $1 million in production, Krebs was facing the transition from the traditional sales and marketing model to a consultative model.
Game Plan: First, Krebs performed a thorough analysis of his business with a 12-page questionnaire, telling Oechsli his annual production, assets under management, number of accounts, business development history, management issues, operational efficiency, his consulting process, personal habits and personal goals. "Then I look for disconnections or contradictions," Oechsli says.
Next, Krebs evaluated his book, performing a "net profit contribution analysis" to determine where the greatest profitability was among his 600 clients. He also painted a composite picture of the ideal client and the perfect business niche.
Krebs and sales assistant Peggy Montero-Guidry then studied how they were spending the majority of their time and found that a disproportionate amount of time was being invested on smaller accounts.
The result: Krebs set a minimum account size (which he declines to reveal) and trimmed his book by about 300 clients, either transferring them to other brokers or to Merrill's customer service center in Princeton, N.J.
Oechsli told Krebs to concentrate on "intensely servicing" his top 25 clients and have less intense, hands-on responsibilities for another 50.
"By intensely focusing on our top 25 clients, our hope is that we can replicate them with friends and colleagues," Krebs says.
"His objective is to bring on a very select number of new pieces of fee business that he will personally handle next year," Oechsli says.
Oechsli also helped Krebs with the verbiage he should use to explain his new fee business to clients.
Together, they drafted a letter clarifying the transition and revamped Krebs' slick sales brochures into literature more fitting a financial consultant. The result was a marketing document that describes his team members, philosophy and investment process, Krebs says.
"The skills and qualities that enable a broker to become successful in the sales and marketing model are the exact same qualities that drive success in this new consultative model - they're just a little more complex," Oechsli says.
Krebs' team now consists of two producers, an investment associate who does portfolio management and trades, and three client associates.
Bottom Line: Although he would not provide specific numbers, Krebs says he more than doubled his goal for increased assets within eight months, thanks to his coach and the support of his branch manager.
"If you're thinking about using a coach, do it sooner rather than later," Krebs says. "It is a career-changing opportunity. You may arrive at the same conclusions and results eventually, but you'll get there a lot more quickly with a coach, and both you and your clients will be a lot happier."
Here are the most common problems poisoning a broker's practice. The problems - and the antidotes - are from coach Matt Bolka, Quality of Business Training Programs, Blowing Rock, N.C.
1) Identity crisis: Not knowing what needs improvement. Examine your business and tear it apart to see what's working and what's not.
2) Blurred vision: Not knowing where you want to go. Many reps lack clearly defined goals. Be specific and break goals down into specific daily steps.
3) Discontinued education: Stopping before you understand. You can gain a good working knowledge of just about anything in six months if you make a commitment.
4) No plan: Not having a formal, written business plan. Among other things, your plan should include what products/services you will provide, how long it will take to provide these services, how many hours you want to work, how you will be compensated, projected expenses and how many clients you need to fulfill your projections.
5) Client overload: Serving too many clients. Your goal should be to cultivate a higher quality of clientele.
6) Unhealthy relationships: Maintaining weak ties with clients. You need great relationship skills to build a great book.
7) Overwork: Suffering from burnout. Take time off to rejuvenate, relax and become well rounded. Delegate, eliminate or simply ignore certain tasks.
8) Worker mentality: Having a job, not a business. Step back and become a leader. You know you're on track if you can sell your book for a profit.
9) Sameness: Lacking unique features. When your clients can't distinguish you from other brokers, they're more apt to question why they do business with you.
10) Isolation: Not having a proper perspective on the industry. Read, talk to other brokers and attend industry events.
11) Low self-esteem: Lacking confidence. Study what makes successful people successful and apply their concepts.
Here are a few coaching firms and how to find them.
Bill Good Marketing Systems, Bill Good, 801/572-1480, www.billgood.com
Pusateri Consulting, Leo Pusateri, 716/631-9860
Creative Management Group, Richard Hunter, 404/303-1006
Entrepreneur Odyssey, Paul Williams, 561/999-9913, www.eodyssey.com
International Performance Group, Joe Lukacs, 321/255-2889, www.ipgllc.com
Paragon Resources, Krista Sheets, 404/873-0099, www.ParagonResources.com
PSBtraining.com, Bob Payne, 609/601-8090, www.psbtraining.com
Quality of Business Training Programs, Matt Bolka, 800/472-3288
Referral Coach International, Bill Cates, 800/488-5464, www.referralcoach.com
The Consortium, Nancy Lininger, 805/987-6115, www.liftburden.com
The Oechsli Institute, Matt Oechsli, 800/883-6582, www.oechsli.com
TruQuest Corp., Leif Hartwig, 888/624-2468, www.truquest.com
NOTE: Registered Representative does not intend this list as a recommendation, nor does it represent a complete source of available coaches. Please conduct your own research before hiring a coach. Some coaches contract with firms only.