Beverly Flaxington is a practice management consultant. She answers questions from advisors facing human resource issues. To submit yours, email us here.
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Dear Bev,
The 8-Factor Sales Effectiveness Model
Is it possible for the average advisor to find new prospects? Most business comes from referrals, but that’s not what I am considering. Can I find prospects without cold calling or running an advertisement, both of which are time consuming and expensive? Are there areas and places where an advisor can find new prospects? I’m a younger advisor and am expected to do this, but I think it is an exercise in futility.
Kel P.
Dear Kel,
You are raising an issue we see frequently in the industry right now: new younger advisors are expected to just “find” new opportunities. You aren’t trained as a broker with a calling list, and the lead advisors you work with aren’t willing to share their contacts for referral purposes. You didn’t say these last two points, so I am conjecturing. But this is a story I hear a few times a week.
You are absolutely right – most new business for advisors comes from either client referrals or from relationships with centers-of-influence (COI). That said, I posit that the referrals from COIs are actually “new” business to you and to your firm. That’s the best area of focus for you.
However, you might raise an obvious question: what’s a seasoned COI going to need from a younger, less experienced advisor? There are challenges in pursuing this avenue, so I recommend a few things you will want to do before you launch an aggressive effort (and you will need to launch aggressively at some point):
- Be sure you are confident and comfortable describing what you do and what your firm offers. What stories can you tell? What markets do you best serve? How would you describe the process and the results?
- Work with your lead advisor, if possible, to identify COIs who might be “friends of the firm” already. Then, find the younger COIs on their staff. They might be professionals also looking to build their practice, so you could have common ground.
- Think about your target markets. Are there specific COIs who work with the kind of people you serve well? Navigate to connections that fit nicely with your existing market
- Think outside of the standard COI definition. It’s not just attorneys and accountants. Could you find a business consultant or M & A expert who might work with people who are in need of financial advice?
I believe the COI route will be your best opportunity, at least initially, to make connections for new prospects. The other area could increase your own public “brand” in the market. Do a few “free” sessions at local organizations or clubs to offer insights and information. The more you are known as an expert, the more you might draw people who hear you speak – especially the next generation for whom your style will resonate.
Dear Bev,
The market movements are creating some very nervous investors. I think our time should be devoted to ensuring that we are choosing the right portfolio allocations during these difficult times, but I am pulled in so many directions right now. I have clients emailing and calling me to schedule in-person meetings. I want to focus on the portfolios, but I realize that ignoring these requests will only make the problem worse. What’s the right way to prioritize in these conditions? I think we are in for a bumpy few months at best, so I don’t expect the problem to go away quickly.
Tom N.
Dear Tom,
This is an inherent problem in running a high-touch firm where your “offering” is also high-touch! You have to do an excellent job of delivering the investment service and results, but if you don’t give attention to the people you are serving, they’ll lose confidence in you! There are only so many hours in the day and clearly both of these things are important, so I can’t recommend prioritizing one over the other. That said, there are things you can do to be more efficient and cover more ground:
- Be proactive in your communication. It’s not enough to just email an update. Consider recording yourself on audio or video and distributing that to clients. Or having a recorded section on your website where clients can visit and get updates at their timing. Consider doing a webinar for clients and ask them to submit questions in advance. This way you control more of the timing on communication.
- While it’s hard to add another thing to the list, consider stepping back and reviewing your investment approach. Are you maximizing efficiency in your approach? If you have a heavy research orientation and you are doing the research, it might not be the most practical option. Or consider whether you can add to staff in an investment support capacity.
- Proactively schedule meetings with clients for fourth quarter now. If they know they are meeting with you they might hold on their questions until they can see you in person.
Right now things are out of your control; the market will do what it will, and clients will call when they want. Take some of your control back and see how you can respond in a more efficient and effective way.
Beverly Flaxington co-founded The Collaborative, a consulting firm devoted to business building for the financial services industry in 1995. In 2008, she co-founded Advisors Trusted Advisor to offer dedicated practice management resources to advisors, planners and wealth managers. She is currently an adjunct professor at Suffolk University teaching undergraduate students Leadership & Social Responsibility. Beverly is a Certified Professional Behavioral Analyst (CPBA) and Certified Professional Values Analyst (CPVA).
She has spent over 25 years in the investment industry and has been featured in Selling Power Magazine and quoted in hundreds of media outlets, including the Wall Street Journal, MSNBC.com, Investment News and Solutions Magazine for the FPA. She speaks frequently at investment industry conferences and is a speaker for the CFA Institute.
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Beverly Flaxington is a practice management consultant. She answers questions from advisors facing human resource issues. To submit yours, email us here. 
