Let's not bother to rehash the difficulties our industry has experienced over the last few months. It's been a roller-coaster ride — and not a fun one at that. Advisers are frustrated, stressed-out and very tired of taking calls from unhappy clients. So what's good about it? Do we need to put on the rose-colored glasses and find the silver lining — or any other happy metaphor one can assign to a difficult situation?
No, the reality is that these times are causing pain and difficulty for many advisers, and they are creating opportunities and boom times for others.
Right now, there are two distinctly different types of firms — those seemingly drowning in the woes of the market, and those growing by leaps and bounds, and bringing new clients in on a regular basis. Yes, the second group exists and is enjoying the growth opportunities that this market presents to them.
What are those firms doing right in the difficult market environment?
• They aren't relying solely on the standard forms of communication such as the packaged newsletter and the weekly or monthly update e-mail. Instead, they provide more personalized ways to communicate their own perspective on the market environment, and what they are doing to manage through it.
Clients gain confidence by hearing a message that is specifically geared to them by their adviser, and that tells them what their adviser is doing to manage through the difficult times. Clients hate canned communications; they want a thoughtful, customized plan.
• They make it easy for their existing clients to refer others by offering to solve a problem, or meet a need, for a friend or colleague of the client. Most important, they are clearly communicating the types of people they can best support, and the types of problems they solve. Their clients can easily identify others who could benefit from their help.
• They are providing education. They provide information about the market, its historical trends and how it compares to other periods of volatility. They don't appear aloof to clients, but rather are accessible and willing to share their own experience and observations in meetings, seminars, webinars and audio recordings.
• They have a plan. They might be making mistakes just like every other investor, but they do have an investment strategy and a rationale for the decisions they are making. They are evaluating their process and determining what mid-course corrections they need to make. In addition, they are communicating any changes to their clients.
• They manage their own stress. This one is crucially important. Clients need to sense from their adviser that he or she is in control. It's human nature to look to the expert to see if he or she are worried. If we sense panic, we allow our own imaginations and worst fears to run away with us.
The adviser who is managing his or her own stress — outside of the office — and appears calm and in control, is the one clients will gravitate to every time.
• They remain optimistic. Here is where the rose-colored glasses will be a benefit. Let's face it — no one knows where this market or this set of economic conditions will lead.
In neurolinguistic programming, there is a process called "reframing."
Reframing says that every situation can be interpreted in a number of different ways, and putting a different frame around a situation allows you to change how you experience it. One person might look at something and say, "That's great." Another person would say, "That's terrible." Same situation, different interpretation.
Therefore, advisers who can remain optimistic and identify opportunities that will serve their clients well over the longer term will be much better received than those who are negative or downbeat.
• They keep on selling — and stay focused on business-building activities. They don't take the attitude of many in this market, "Well, clients are scared. We shouldn't expect many new clients, and even our existing ones are at risk." No. The advisers doing well right now say, "There are a lot of people out there who now, more than ever, need our help. We need a plan and a set of action steps to find them."
Many fortunes and businesses were built when the competition decided to ratchet back and lie low until the good times returned. Others were busy experiencing the good times at the competition's expense.
Beverly D. Flaxington is a principal of The Collaborative, a Medfield, Mass., firm that helps clients improve business practices.
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