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,
I’ve been in the investment advisory business for a long time. I’ve been through a number of significant market ups and downs and have always managed to work with my clients in a way that shows them what I am doing, gives them confidence and helps them approach any changes with calm.
Lately, with the 2016 and 2018 elections, combined with the erratic movements in the market, my clients are much less at ease and don’t have a problem letting me know. I’m being asked about everything from our position on climate change when we invest, to my political beliefs and that of my colleagues.
I don’t mind having conversations with clients. We can agree to disagree. But I’m finding the tenor of these discussions lately to be caustic in nature. I’m starting to think it is time for me to retire (I’m 64-years old) because these conversations and the pushback is exhausting.
How can I find a successor to work with my clients and take my business over as I move out? I have a team of 11, but there is no one who is prepared to be my successor. I’m not sure where to start or what to do.
M.S.
Dear M.S.,
You threw me a curve ball with the way you ended this inquiry! I was prepared to give some advice on communicating with clients during tumultuous times, or on handling political discussions with clients. Then you transitioned to a discussion on succession. If this is your decision, and you believe the timing is right for you, and there isn’t another option for you to keep going and deal with what’s happening right now in a different way, yes there are a few things you can do to ensure a smooth transition. It isn’t going to happen right away however, especially if you haven’t identified anyone to fill your shoes. So think about your conversations with your current clients and find ways to be more calm and confident in these interesting times.
For succession – a few considerations:
- If you have decided you have no one in your current firm who could fill your shoes, be sure to create a clear position description for someone incoming to the firm about what exactly this role will entail and how you expect to transition the leadership. I don’t know enough about your existing team from your inquiry, but likely your staff will have concerns when they find out you are retiring and someone unknown to them is coming in to run the firm. Be sure to involve them in the discussions about the role, and the process and be crystal clear what you need the new person to do, when you want to make the transition and how they will interact with your existing staff members.
- To find a good candidate, network instead of just publishing a job description broadly. Do you have relationships with COIs such as lawyers or accountants? Do any of your vendors (technology, investment, etc.) know advisors they interact with they could recommend? Could your custodian be helpful in making an introduction to a like-minded advisor? Start talking with people you trust about your objectives and see if you can find someone who is known to those you already know and trust.
- Consider a merger or working with an asset gatherer. The fastest way for you to retire would be to align your firm with a larger entity interested in buying firms and client assets. There are more buyers than sellers, so you could be in an advantageous position to generate a good offer. This would also help you, because likely the acquiring firm would have a process for communicating with your existing clients and transitioning the accounts. It might provide you with a roadmap.
Dear Bev,
We spent a great deal of money two years ago on revising our website. The firm we used to do this work claimed to be a marketing firm that could help us with our story too. We recently hired a firm to help us with business development and they have been very harsh about our website. They claim we cannot market very effectively with what we have – we need new language and new look.
As the sole owner of the firm, every expense comes from my personal pocket. I don’t see the advantage to spending good money on top of bad. When does a website sell anything in this business? How is it possible we can’t just do a better job of telling our story and let our website speak for itself? I don’t understand how cost upon cost is going to find us new ultra-high-net worth clients.
Y.W.
Dear Y.W.,
Are the people involved in business development confident telling the story of your firm? Are you using your website for anything more than a calling card? For example, are you engaging in activities to drive traffic to your site? Is your target market young and sophisticated, whereby they might check a website before agreeing to talk to someone? Does your website have enough about what you do, but just doesn’t do a great job of illustrating it?
Diagnose your current situation: What you are trying to accomplish with the site, and how much of a transition you would need to undergo to move from current to desired outcome? In many cases, if the site looks good, you could hire someone at a reasonable rate to make changes to the copy. This is not a big undertaking and could be done very quickly. If your target market doesn’t spend much time on your website, or doesn’t care much about your online presence you may be fine with what you have now, and working on helping team members tell the story more effectively verbally.
It all depends on the traffic you have on your site and what you want your site to do for you. Advisors often underestimate the importance of an online presence, however. You don’t know all of the people who come to learn about you and then don’t end up engaging because the site itself is not interesting enough to them.
There are many good resources to help you without having to invest a great deal. For example, try a local college – often web or marketing courses are looking for real-world situations for the students to use. You might be able to get a student or intern who just wants to get some experience. There are websites such as elance.com, guru.com or fiverr.com where talented individuals and firms shop their expertise. You have to do more oversight with sites like this and usually give them more support and direction but the investment of money could be lower.
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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