by Bob Simpson, Synchronicity Performance Consultants
In February 2013, I published an article entitled “Twelve Steps to Make Your Business Fun Again”. It was posted on www.advisoranalyst.com and they reported to me that it was one of the most read articles ever posted on their website.
The overall message resonated with financial advisors. The financial services industry is still relatively immature and changes have been and will continue to be constant.
Wealth management has provided thousands of individuals the opportunity to build personal wealth through helping clients to achieve their financial goals and dreams. It has been a huge, personally fulfilling, entrepreneurial opportunity to develop a vision, identify a finite group of clients who share that vision and work collaboratively to convert dreams into reality.
In the mid-1980s, the firm for which I was one of the top AUM and revenue advisors (Nesbitt Thomson) was acquired by Bank of Montreal. This marked a major change in the direction of the industry. Banks provide many benefits to advisors and their clients, such as safety and stability but the added bureaucracy and controls make it difficult for entrepreneurial advisors to pursue their visions and build their businesses on their terms.
Additionally, new programs such as CRM2 and increased risk of litigation have increased advisor stress levels.
Since writing “Twelve Steps to Make Your Business Fun Again” in 2013, there have been a lot of changes but many of the factors I discussed in that article remain intact. Regardless, it is a good time to update the list.
Over the next few weeks, I will focus on a number of ways that you can “Make Your Financial Advisor Practice More Fun Again.”
Make Your Business Fun Again – Tip # 1 – Only Work with Clients You Enjoy
Often, we get caught up with account size. Sure, you make more money working with big clients but you have to weigh the money you make from some larger accounts with the pain you must endure in servicing those clients. The most successful advisors only accept clients who pass the “Three Ps Test” (profitable, pleasant to work with and those who can be promoters for their businesses).
Client segmentation can do a good job of reducing the number of unprofitable clients but it is also a good idea to make a list of your top 100 clients and rank them into three categories (Pleasant, Acceptable and Unpleasant). Analyze your list of Unpleasant Clients and if you aren’t 100% convinced that these clients are worth the pain for the profit, disengage immediately.