Being able to persuade people to do what you really believe is in their best interests is very important
Most financial advisers are deluding themselves. They think they can singlehandedly follow the markets, build customized portfolios for clients, handle compliance, prospect for new customers and develop talent on their teams.
It's way too much for one adviser to master, and that shows in the service they deliver. In reality, many clients are paying them a fee to guess about what is going on.
Advisers may not want to hear that, but many know I'm right about this. When I give talks around the country, I ask them, “If your clients knew how you spend your time — versus how they perceive you spend your time — how many of you would be embarrassed?” Typically 80% or 90% of the hands shoot up in the air.
But they continue doing what they're doing.
It doesn't surprise me to see advisers fall into this trap. I started my career thinking I had to know everything and do everything for my clients — and I worked around the clock to do that. It took me years to realize I could better serve my clients by being a librarian and not a library.
My company now coaches more than 1,100 financial advisory firms in the U.S. The very best advisers among them have figured out the secret to building their businesses and delivering true value to their customers. These advisers realize the highest and best use of their time is in being a salesperson. They cultivate that talent.
A NOBLE PROFESSION
Selling has negative connotations in our society, but I believe selling is a noble profession. Being able to persuade people to do what you really believe is in their best interests is very important. It is different than manipulating them into taking an action where you will be the beneficiary, such as buying an overpriced service or one that they don't need.
Years ago, I tried to persuade someone from my community to let us manage his portfolio. He had most of his assets in Enron stock, and I knew he should diversify. He resisted my advice. Years later, when Enron had imploded and his holdings were worthless, he told me, “Ron, every time I see you, I wish I had taken your advice.” What I thought was, "I wish I had been a better salesperson.'
I've made sure that I am now.
When you've got a strong value proposition behind you, you need to know how to tell your story in a way that persuades people to let you protect and take care of their wealth. You can't create value for clients if you are not able to do that.
But you also need to deliver the value. It is hard to find both talents in one person.
I recently had a prospect come to our office. The prospect was evaluating our firm versus another that promised a customized portfolio.
“When you say customized, what do you mean?” I asked.
“They will buy securities for us based on our needs,” the prospect told me.
“Do they do this for everybody?” I asked.
“Yes, they do this for all of their clients,” the prospect told me.
“Well, how big is their research department?” I asked.
It turned out they didn't have a research department. It was a single-person advisory firm.
I have a research department of 30 people. They spend day in and day out following the positions we have. I don't have the bandwidth to build customized portfolios. So how can a single adviser do that successfully?
The best financial advisory firms deliver both sizzle and substance to serve clients well. The salespeople who bring in clients usually are not the best researchers in a firm. Brilliant research directors generally are not great salespeople. Together, they make an unbeatable team.
CREATE A TEAM
If you're the rainmaker in your firm, own that gift and use it to attract clients you are in a position to help. Find a way to team up with others who have talents in areas where you are not as strong — either by hiring them or by joining a professional alliance. That way, you can truly deliver service that is worth the fees you're charging.
Ron Carson is the founder of Carson Wealth Management Group and Carson Institutional Alliance.
