Failing to plan is planning to fail. —Alan Lakein
If you don’t know where you are going, you might wind up someplace else. —Yogi Berra
Your business plan defines where you want to go and how to get there. You can use the plan to monitor your progress, hold yourself accountable, and control your business’s fate. A written business plan forces you to review everything at once: your value proposition, marketing assumptions and plans, operations plan, financial plan, and staffing plan. A well-executed plan can deliver the results you promise yourself. Developing a business plan is an imperative!
The structuring of a wealth management team and business presents both challenges and opportunities. A well-run team will be efficient, achieve optimal workload and flow, fully understand the value of their time, and have a plan for long-term growth and sustainability. Over the years, we have met many teams and had a chance to study their practices. Generally speaking, teams fall into one of two categories. The first is managed chaos, where there just aren’t enough hours in the day to get everything done. These teams have lots of meetings and lots of administrative work, the team leader is frequently traveling or in new client meetings, there is little scale in asset management, there is lots of trading and customization, and the feeling one gets is just overload.
The other type of team is calm. A calm team has a quieter buzz in the office. Tasks and meetings are done much more deliberately because they are planned, efficient, and effective. These teams make time for strategizing, the quality of work is high, they have a proactive service model, clients are engaged, and each team member has a defined role, to name some key traits.
What does your practice look like? Is it managed chaos or calm and effective? The key question is why are the calmer, effective teams able to manage their time more effectively and efficiently? The answer lies in the planning that these teams do in advance. These teams have a very deliberate business plan. They have decided who they want to work with and how many clients they can serve effectively, and they have a clear service definition for exactly what they are going to provide for each client. They have a set of goals, strategies, tactics, and action plans. The calm, effective teams have decided they can’t run a practice without having a business plan and without planning their time well. Controlling the key variables of their desired target market(s), the number of clients, and their service commitments is critical. These teams do not have too many clients, they do not need to be overreactive, disrupting their plans, and they don’t try to be all things to all clients. They plan to avoid these things.
To illustrate, let’s examine this from another business’s perspective. A business that can help its clients and deals well with time management is one we are all familiar with: a dental practice. Over the years we have worked with a number of dental practices, and some are managed chaos while others are very calming, efficient, and effective offices. We would all prefer to work with a dental practice that is calm, efficient, and effective. You set an appointment then receive several friendly reminders via text and phone so you are prepared for your visit. Once you arrive for your appointment, you are checked in, seated in a comfortable area where you can watch TV, read the newspaper, have something to drink, and relax for a few minutes. The staff knows all of their patients well and what they are there for, and they have a warm and friendly culture. Once your procedure is over, you are walked back to the main reception area where you can review your bill and insurance and make your next appointment. As a result, the process is professional, comfortable, and personal, which is what you want. You and the professional’s time are effectively and efficiently used.
By comparison, we have known dentists who weren’t quite as calm and professional. This is a different kind of practice. The furniture is old and outdated, there is no TV, no refreshments, the staff always seems too busy, and you have to wait while the receptionist is handling lots of calls, has piles of paperwork around, has a hard time fitting you into their future schedule, and seems to know you primarily through a manila folder of which there are thousands. The dentist rushes in and rushes out and always seems to be behind schedule. It’s a very different environment and feeling. The chaotic practice simply has too many clients because over time it became a “volume” practice instead of a “higher end, higher touch” practice.
If you were a several million-dollar prospective financial services client, you would want to work with a professional who is always prepared and has a very well organized group. That’s what this book is about, and when examining how to attract more ideal clients, the firm needs to be built and in position to properly market to and service those clients.
There are other lessons we can learn from dentists. One is that the dentist is the expert and in charge. He or she may consult with you, but ultimately you will be given a recommendation that you will most likely take. You do not see a patient suggesting that they would like a root canal when the dentist has suggested you fill a cavity and focus on proper maintenance and hygiene. Similarly, your clients look to you the same way, as the expert. Dentists are in the prevention and pain management business. A dentist will give you a plan to keep your mouth healthy and at the same time prevent pain that may arise occasionally. Your clients also look to you to keep their financial plan and portfolio healthy and to avoid as much pain as possible. We also learn that reaffirmation is important. When the dentist says “Everything looks good; see you in six months,” that’s a good feeling. Your clients look to you for the same assurances.
All of this illustrates that in our daily lives we get a chance to see many businesses as well as advisory practices. Pay attention to these experiences. You will notice that some businesses are very efficient and focused; some deal with a select clientele while others serve the masses; and some provide an exceptional client experience. Within your practice you can define who and how you want to provide service. Ultimately the clearer that is, the more time you will have. The more time you have, the more energy and manpower can be focused on growing the practice and other high value uses of your and your team’s time.
All of this begins with the business planning process. A planned and well-run practice should be growing at 15 percent per year as measured by new clients, new assets, and new revenue. A normal practice will leak about 5 percent per year, with clients and assets leaving, so bringing in 15 percent per year of new business will help ensure that your practice is growing at 10 percent net per year. Using the rule of 72, the business should then double in size in seven years, assuming flat capital market returns. In order to achieve this level of growth a practice should have 20 percent of manpower focused on growth. Naturally you can establish a higher growth goal for your business, which will impact your plans and your resource requirements.
A business plan is a tool for understanding how your business is put together and how to take it from where it currently is to where you want it to be in the next X years and how you plan to accomplish that. You can use the plan to monitor progress, hold yourself accountable, and control your business’s fate. Writing your business plan forces you to review everything at once. A well-executed plan can deliver the results you promise yourself. For our purposes we will think of a business plan as a 12-month plan, though plans can be put in place for two, three, and five years just as well. Having said that, the longer the plan looks out into the future, the less reliable it will likely be in a dynamic world. Therefore, longer-term plans should be more generalized and goals based with larger potential steps and alternatives rather than detailed tactics. Longer-term plans are meant to be directional in nature. Business plans for financial advisors that are any longer than five years don’t make a lot of sense other than as general statements about the sale of the business, for example, or succession planning, or intent to partner. Even then, they are not plans but intentions. (Companies with significant research and development or major build projects may well have longer-term plans.) The plans you make, however, including for the intermediate term, need to be updated annually, so you may be looking out five years, every year.
Business planning must be a frightening concept! If you Google “business plan,” you will get tens of millions of hits. Yet no matter how much extolling of the virtues of and necessity for a business plan, it seems a minority of advisors have one, at least a good one. And, if they do, they rarely seem to review the plan and see how they are doing against the things they “promise” themselves.
One of the points we make with advisors and planners is that a classic business plan is not required by advisors especially in cases where they are not a start-up or seeking external funding or doing a deep dive into the competitive marketplace. A “business plan” for most advisors and planners is more about setting growth goals and developing an effective marketing and sales strategy for reaching of those growth goals. An effective marketing and sales strategy is about the approaches you are going to take to acquire new clients and gather new assets from both existing and new clients (e.g., introductions from clients).
While it’s of value to have a handle on revenues and expenses, if you are not a start-up, it’s not that difficult. In fact, for some brokerdealer advisors, there are relatively few expenses per se, and they can be estimated fairly easily by looking at last year’s expenses and projecting an increase in proportion to that year’s expenses and your growth goals. For example, if you pay your assistant 1 percent of gross as a bonus and last year you grossed $500,000, you rewarded him or her with a $5,000 bonus. If you are projecting a gross of $600,000 this year, you would budget $6,000 for a bonus. If you budgeted 4 percent1 for marketing last year and hit your expense target of $20,000, this year you might budget $24,000 and make adjustments as you prefer and/or as a function of last year’s overspending or underspending. If your plan calls for additional marketing campaigns not in last year’s budget (e.g., monthly client intimate dinners), then increase your budget by an estimated amount for that campaign.
If you are an independent advisor with your own overhead, you know what you spent last year for personnel, equipment, rent, heat, light, power, etc., and you would use last year’s numbers adjusted for any known or anticipated increases and use a similar approach for bonuses and marketing expenses. Your biggest variable may be in increased personnel costs required to grow your gross by 20 percent. This is something you should be able to determine by evaluating whether your staff seems already overloaded or at capacity. Even if they are neither overloaded nor working at capacity, you may bring in staffing in different forms and over time, such as virtual employees, interns, part-timers, or full-timers. You will also have to determine any space requirements for additional staffing.
We trust that this portion of your analysis is well within the range of your capabilities as an FA. It’s easier than the marketing and sales portion of your business plan. In any case, it’s best to establish your marketing and sales budget after you have completed the rest of your plan.
For many, if not most, FAs and planners, we suggest a base business plan should include the following sections:
1. A Review of Last Year (for perspective)
2. Your Business Foundations (i.e., value proposition; ideal client profile, if unique; and target or niche markets)
3. Goals (including any special or emphasis areas such as financial planning, insurance, etc.)
4. Focus Areas
a. Marketing and Sales Strategies and Tactics
b. Service Strategies and Tactics
c. Operational
5. Model Week/Time Blocking
6. Marketing Calendar
7. A 90-Day Action Plan
Examples of these sections will be illustrated in the next sections. You can put together your marketing and sales portion of your business plan in one or two weekends—yes, two to four days is enough to get a base plan in place with some limited detail. My suggestion is to put your plan together starting early November and completing it by the end of that month. If you are part of a team, you should work together using a common approach. Parts of the plan can be done together (e.g., Last Year’s Review, Business Foundations and Goals, Marketing Calendar, and the 90-Day Action Plan) after a couple of hours in a planning session working with a sample plan and format. Parts of the plan can be done independently and reviewed as a team (e.g., the focus areas such as Marketing and Sales Strategies and Tactics, Service Strategies and Tactics, Operations, and Model Week/Time Blocking).
When complete, your entire team should read the plan and discuss it for a couple of hours, asking and answering questions and making any needed changes. The plan should be read by your manager, if you have one, for feedback of value. Your plan is also a document that can be used by potential new employees whose feedback will also be of value.
There are, however, other views on business plans that go beyond the base plan we are recommending. In her article “Why Goals Are Secondary in Business Planning,” Julie Littlechild says a goal may be “growth or income. Having that kind of goal, however, is very different from having a vision of the business and life that you want to live. I’d suggest you need both.”2 Littlechild goes on to say that a vision might include the kind of clients with whom you want to work, the kind of work you want to do, the environment in which you want to work, and the people with whom you want to work, among other items. We wouldn’t argue the point of using “your vision as a filter,” and as she goes on to say, “By all means, set goals, just . . . to decide if they are the right goals.” For this book, we will stay focused on the elements of a marketing and sales plan based on growth goals. Establishing a practice vision would be an important component of your three- and five-year plan.
There is no question that without a plan for your business the odds are high that you will wind up somewhere, but it’s less likely that it will be where you had hoped. In the many years we have planned and seen plans, we observe two kinds of plans:
• One written for management that essentially says what they want you to say so they can rationalize their growth projections. Once written, these plans sit on a shelf. They are rarely if ever pulled out and reviewed or used to see where you are versus where you planned to be and/or modified based on your current reality. They are essentially ineffective as a tool for growing your business.
• One written for yourself and your team. These plans are done to guide your day-to-day efforts to get you to your desired end-state. They outline the roles and responsibilities of yourself and your team. Your action plans need to be reviewed weekly or monthly at most, and the overall plan reviewed with your team at least quarterly.
Our planning approach is essentially a marketing and sales plan. How do we get from where we are to where we want to be? We can estimate costs, but our focus in this plan is on asset growth. We start the plan with several base questions in the review of last year:
• What went well (this current year)? What were your successes and how did you accomplish them? Can and should they be repeated?
• What could have gone better (this current year)? What were your greatest concerns/hurdles? Can you overcome them in the coming year and how?
• What would your clients say about you if asked?
Figure 7-1 is a tool/questionnaire you can use to create your value proposition and better answer that last question: “What would your clients say about you if asked?”
In addition to developing your Unique Value Proposition (UVP) with material discussed in Chapter 1, you may also want to ask selected clients the following questions to help you refine your value proposition based on client input. These questions are most effective when asked in person, but it can also be done over the phone. When you speak with clients, ask them if they would be open to spending a little time answering some questions that will help you and your team become more focused so you can offer better client service. Your best clients will be willing to help.
Figure 7-1 | Section 1 Business Plan: Review of Last Year.
20XX Business Plan For:
__________________________________________
Review of Last Year
What went well?
1— Revenues up 15%
2— Fee based business up 6 points to 63%
3— Net new assets increased by $9 MM to $72 MM
4— Net new households increased by 5
5— Received 7 unsolicited referrals; closed 4
6— Segmented book of business
What could have gone better? What were your greatest concerns/hurdles?
1— Prospecting, i.e., use of LinkedIn, consistency in asking for introductions
2— More consistency in client contact
3— Developing relationships with COIs
4— Using structured review and planning meetings with A and B clients (agenda and after-meeting letter)
5— Use of Client Service Model/Promise
6— Time management
What would your clients say about you if you asked?
1— Works in my best interests
2— Trusts my recommendations
3— Easily accessible
4— Proactive on contacts and determining my needs and interests
5— Has integrity
Questions to Develop Value Proposition
1. What do you think are my and my team’s greatest strengths?
2. How would you describe the service experience you have with my team?
3. How would you describe your investment experience with me and my team?
4. When you decide on a service provider, whether it’s financial services, tax services, or medical, for example, what are the characteristics you look for?
5. Do we communicate with you enough, the right amount, or too much?
6. If you were to describe the exceptional client experience, what would be the most important components?
7. How would you describe the value I and my team bring to you?
8. If a friend asks you about us, how would you describe what we do for you?
9. If a friend or relative asked you why you chose us to manage your financial goals, what would you say the reasons are?
10. Name three things we can do to strengthen our relationship with you.
Take excellent notes during these conversations. They will be the foundation of your value proposition.
While not statistically accurate, we suggest having such a discussion with 10 to 15 clients and looking for common themes. We would focus on A tier clients and some B tier clients. In your A and B tier interviews you will also be seeking improvement opportunities to consider. Separately, you may want to interview some C tier clients as well to get a sense of where you stand with that group and the service model you are delivering. Some improvement opportunities may also exist.
When you are done, ask yourself and your team these three questions:
1. Did we hear anything that surprised us?
2. Can we add clear and powerful content to our UVP from what we heard?
3. Are there areas we need to improve to create an exceptional client experience going forward?
To define business foundations, state a short version of your value proposition: Why should or why does a client do business with you as opposed to the 285,000 other choices? Defining a short value proposition is not easy. Glean ideas from Chapter 1; also consider financial life planning pioneer Mitch Anthony,3 who, according to blogger Michael Kitces, put forth terminology for “articulating the true client-centric value proposition of financial planning.” Framing the goal in the context of improving a client’s “Return on Life” (ROL, as opposed to the traditional approach of trying to improve the client’s portfolio ROI), Anthony suggested six key value propositions of financial planning:4
Organization. We help bring order to your financial life by assisting in getting your financial house in order (at both the “macro” level of investments, insurance, estate, taxes, etc., and also the “micro” level of household cash flow).
Accountability. We help you follow through on financial commitments by working with you to prioritize your goals, show you the steps you need to take, and regularly review your progress toward achieving them.
Objectivity. We bring insight from the outside to help you avoid emotionally driven decisions in important money matters, by being available to consult with you at key moments of decision-making, doing the research necessary to ensure you have all the information, and managing and disclosing any of our own potential conflicts of interest.
Proactivity. We work with you to anticipate your life transitions, and to be financially prepared for them, by regularly assessing any potential life transitions that might be coming and creating the action plan necessary to address and manage them ahead of time.
Education. We explore what specific knowledge will be needed to succeed in your situation by first thoroughly understanding your situation then providing the necessary resources to facilitate your decisions and explaining the options and risks associated with each choice.
Partnership. We attempt to help you achieve the best life possible but will work in concert with you, not just for you, to make this possible by taking the time to clearly understand your background, philosophy, needs, and objectives; work collaboratively with you and on your behalf (with your permission); and offer transparency around our own costs and compensation.
As Michael Kitces says, “While the words themselves are not necessarily new and unique, Anthony’s use of them, along with explanations of exactly what the advisor provides, and how . . . paint a remarkably clear picture of what the intangible service of financial planning [based practice] is meant to provide. . . .”5
It doesn’t help you to define an ideal client profile as affluent, nice people who take your advice, are in their 50s or 60s or older, and are willing to accept a fee-based approach. This definition gives you no specific target. You need to be targeting areas where you can focus your attention and get attention. We will discuss niches further in Chapter 9. We suggest your ideal client profile, your target market, and your niches can be synonymous. Niches are narrowly defined (e.g., not doctors, but anesthesiologists or gastroenterologists or radiologists). Individuals in narrowly defined fields tend to have a common culture and a natural affinity. They likely read the same professional journals and magazines, attend the same meetings or conference, and have more of a tendency to know others in their sphere.
Women, for example, are not a target market; retirees and pre-retirees are not a target market; airline pilots are not a target market. While there are similarities, there is no single common culture, no common way to access them, and limited shared affinity. If you narrow the focus to women executives in your geography, or working at IBM, or IBM employees retiring from New York City or Austin, Texas, you have a target market as well as a niche. Pre-retirees or retiring Exxon employees in Houston or Baton Rouge could be a niche. American Airlines or Delta Airlines pilots could be a niche. See Figure 7-2.
Figure 7-2 | Section 2 Business Plan: Business Foundations.
Business Foundations
Value Proposition/Mission Statement
We work individually with clients to understand what is important and unique to them and their families. Working with our clients we personalize plans for them that connect their current situation, values, goals, and wants and needs, with their wealth. Our goal is to translate the family’s vision and dreams into a plan with a purpose. As part of this plan we focus on wealth creation, asset management protection, and identification of any risks that will mitigate their plans and ability to maintain or enhance their lifestyle and future.
Ideal Client Profile (Profession, Liquid Net Worth, etc.)—There Can Be Multiple Profiles
Professions include health care professionals, attorneys, CPAs, small-business owners, and corporate executives and managers both pre-retirees and retirees.
Investable NW = $250K minimum
Our community of clients appreciates and is willing to follow the advice of an expert. All of our clients realize that achieving their goals requires both money and planning. Our clients enjoy the simplicity, freedom, and peace of mind that comes from having all of their financial assets under the watchful eye of a single, trusted advisor. Our clients appreciate our advice and guidance. Due to the high level of client interaction and attention, our services make sense for families with over $250,000 of investable assets. Our community delegates financial matters so they can focus their valuable time and energy on the things in their life that are most important to them. Our clients want to hear the truth from us regarding their financial situation . . . no matter what.
Target Markets to Focus On:
1.
2.
3.
4.
5.
Your next step is to commit to a new asset goal that will come from a combination of current and new households. You don’t really need a new revenue goal as it’s calculated as a function of your assets and your current or projected return on assets (ROA). You can set a goal of improving your overall ROA, though it will most likely be within 5 to 10 BPS at most of your current ROA. You can target additional revenue products like financial planning fees, annuities, insurance, or banking, if offered. For every $10,000 you project in such revenues you can lower your asset goal by about $1 million, assuming 100 BPS.
The primary questions are:
• How many new assets will come from existing clients? This will be based in part on what you accomplished in the last 12 months and your efforts in the coming months. There are some questions you need to ask that can impact this area:
• Are your clients appropriately segmented?
• How well do you know your clients?
• Are you aware of any impending money in motion transactions?
• Is your service model written and committed and highly satisfactory to your clients?
• Have you developed a financial plan with the client?
• Did you uncover assets away?
• Are your service processes as efficient as they need to be?
If the answer to any of these questions is no, you have work to do here—and opportunities.
• How many new assets will come from new client acquisition? This will only in part be what you accomplished in the last 12 months. The real growth will come from the new effort you put in.
• What did you accomplish in the last 12 months and the 12 months before that?
• How much time do you spend on new client acquisition?
• How much time do you need to spend on new client acquisition to hit your goal?
• Where is that time going to come from?
• How serious are you about your goal? On a scale of 1 to 10, with 10 being 100 percent committed, anything less than a 10 won’t make it happen.
You need to commit to time blocking. After building a standard Model Week and a Marketing Calendar, you commit to and then develop a 90-Day Action Plan. See Figure 7-3.
Your next and most important steps are to define the “strategies” and “tactics” you will use to both grow assets from existing clients and new clients and improve your service strategy and operations if needed.
There are at least 20 different marketing and sales strategies that can be used to acquire new client households and their assets. Which three or four will you use? This of course may be based on your will and skill as well as your past successes and any past failures that you can successfully overcome. About two-thirds of your new client acquisition will come from introductions from existing clients and centers of influence. LinkedIn is essentially a tactic for gathering introductions usually from existing clients. Networking, both personal and corporate, which would include “intimate events,” is another strategy. If you haven’t considered your “Book of Life,” who you know and how you know them, it may be worth considering. While general seminars are a focus of the past, “roundtables” or “lunch and learns” inside of small businesses can be effective. Finally, “niche marketing” can be a very important strategy. For each strategy you select, you will also develop a set of tactics or steps in the process and the time frames to accomplish them, and assign who has the responsibilities for executing that strategy and set of tactics.
A critical part of the planning process is review and modification of the plan. Whether you are on a team or not, it is an imperative to take a half-day to a full day to review your progress against the plan. (We will discuss a set of weekly metrics you can use to determine progress.) Note what’s working and not working, make modifications and adjustments and major changes as needed, and put together your next 90-Day Action Plan. Your business plan and quarterly reviews will help ensure that you are paying attention to the broad strategies, tactics, and goals of your business as well as any details such as budgets.
Figure 7-3 | Section 3 Business Plan: Goal Planning.
Goal Planning
Additional Focus Areas: |
|
Financial Planning |
Will complete financial plans using XYZ software for 36 prospects and clients |
Insurance |
Identify all A and B clients and all prospects for opportunities |
Managed Accounts |
Recommend as appropriate |
Centers of Influence |
Identify CPAs and Trust and Estate Attorneys of top 20 clients and vet them with client |
Your business plan is mandatory to develop and communicate a course of action for yourself and your team. Remember, however, as Peter Drucker said, “Plans are only good intentions unless they immediately degenerate into hard work.”6
Similar sections are completed for the other aspects of your plan within the “Focus Areas—Marketing and Sales Strategies and Tactics” section. (See Figure 7-4.) In the sample plan, they include:
• Subsection 1: Organic Marketing (client based). Within this section (see Figure 7-5), we suggest identifying:
• Top 5 clients to acquire additional assets from
• Top 10 LinkedIn contacts to approach for introductions
• Subsection 2: New Client Acquisition Marketing (prospecting), shown in Figure 7-6, which should or might include:
• Meeting with prospects who were introduced by clients either as a result of client meetings or the LinkedIn process
• Top 5 pipeline prospects to close
• Five former clients or inherited accounts that you will commit to call on
• Using networking approaches
• Using intimate events and/or targeted seminars
• Subsection 3: Center of Influence Marketing, which includes identifying CPAs and Trust and Estate attorneys from your Top 20 clients and using the COI Marketing Strategy (discussed in Chapter 9) to vet them with clients. See Figure 7-7.
Figure 7-4 | Section 4a Business Plan: Focus Area—Marketing and Sales Strategies and Tactics/Current Clients.
Focus Areas—Marketing and Sales Strategies and Tactics
Identify Focus Areas
1. High-Level Opportunities Within Existing Practice
1. Gather assets away by conducting financial plans for all A and B clients who have not had an update plan prepared within the last 18 months
2. Conduct 3 client face-to-face meetings a week; 3 telephone meetings a week; 11 check-in calls a week based on 35 A clients, 40 B clients, and 25 C clients introducing new Client Service Promise
3. Insurance—Conduct an insurance review in context of an Estate Planning Review for all annual meetings
4. See introductions—Complete “Client Wisdom” profile seeking ways to ask for introductions
5. Use LinkedIn, connect to all clients who are on LinkedIn, update profile, use LinkedIn process to identify prospects with 24 clients
6. Gather COI information from top 20 clients and vet those COIs to identify 10 potential partners
2. Organic Marketing (Client Based) |
|
Gather assets away |
Tactics |
1. Identify clients who have not had a financial plan within last 18 months |
|
2. Determine which clients are ready for annual meeting and schedule, preparing them to conduct financial planning meeting |
|
3. Identify assets away based on financial plan |
|
4. Develop plan to acquire assets based on portfolios |
|
Ensure that estate planning is addressed and insurance needs are met |
Tactics |
1. Conduct insurance reviews for all appropriate clients during annual or follow-up meeting |
|
2. Meet with insurance rep/solutions provider to evaluate case and address needs |
|
3. Prepare case with assistance from insurance rep/solutions provider |
|
4. Call and meet with client to present case |
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Seek introductions |
Tactics |
1. Complete “Client Wisdom” profile for all clients, identifying ways to seek introductions |
|
2. Identify and fill information shortfalls |
|
3. Determine approaches to seek introductions |
|
4. Script introductions requests to use at annual meetings |
|
Use LinkedIn for prospecting |
Tactics |
1. Link to all possible clients, prospects, and COIs as well as unrelated business contacts |
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2. Follow LinkedIn script to get introductions |
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3. Follow up with introductions |
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Figure 7-5 | Section 4a Business Plan—Subsection—Key Current Client Opportunities.
Top 5 Clients to Acquire Additional Assets From:
1.
2.
3.
4.
5.
Top 10 LinkedIn Contacts to Approach for Introductions:
1.
2.
3.
4.
5.
6.
7.
8.
9.
10.
Figure 7-6 | Section 4a Business Plan—Subsection—New Client Acquisition Marketing.
Figure 7-7 | Section 4a Business Plan—Subsection—Center of Influence Marketing.
Figure 7-8 | Section 4b Business Plan: Focus Area—Service Strategies and Tactics.
This section outlines the segments you have created as a result of your work from Chapters 2 and 3. See Figure 7-8.
This section outlines your plans for improvements in areas such as time management, delegation, meetings, roles and responsibilities, and perhaps a new on-boarding process. See Figure 7-9.
We made some points on time management in Chapter 4 when talking about the cost of loyalty. One of the points we made was that FAs have the following key activities that need to be addressed on a regular basis:
Figure 7-9 | Sample Client Annual Progress Summary (CAPS) letter.
• Client and Book Asset and Portfolio Management
• Client Service/Relationship Management (including client planning and review meetings and calls, among a host of other services and deliverables)
• Marketing/Business Development (in a number of forms)
• Team Management
• Business Planning and Tracking
It is necessary for advisors to estimate the amount of time they spend weekly on Portfolio Management and schedule that on the calendar. In the following example, we label time as “Portfolio Improvement Planning.” (In Chapter 4, we calculated an estimate of the amount of time Client Service/Relationship Management might take.)
We suggest handling inbound calls as shown in Figure 7-10 and a sample calendar, shown in Figure 7-11, for this segment of the business plan.
Looking at the sample calendar you can see there are slots allotted to Marketing/Business Development and some open time slots that can be used for Team Management and Business Planning and Tracking, neither of which should be excessive.
Note that on the calendar in Figure 7-11, we have scheduled two hours a day for Callbacks and Email. First of all, this is an excessive amount of time to have to spend on these activities; 25 percent of a 40-hour week would be a prohibitive commitment. These time slots are intended to address internal corporate requests, some team management and problem resolution, as well as callbacks and email handling. Having said that, the more important point we really want to make is that advisors, for the most part, should not be responding to emails and calls as they come in. It is incredibly inefficient, so we strongly suggest taking two time slots a day and getting done what’s necessary at those times: emails, callbacks, critical and time-dependent issues, etc.
The next section of the plan is a Marketing Calendar, shown in Figure 7-12, which can include any number of activities such as:
Figure 7-10 | Assistant script for answering telephone.
CA Should Answer All Incoming Calls to Set Your “Importance”
• If you are in a client meeting and you get a call, CA says:
• Sally (FA) is in a client meeting (in the office, in Connecticut, in “town name,” or just in a meeting).
• I expect her to be free at (next callback time, either 11:30 a.m. or 4:30 p.m.).
• Can I have her call you back then or can I help you now?
This is designed to show you meet with clients anywhere.
Note that we suggest setting 2 time blocks a day for callbacks, e.g., 11:30 a.m. to Noon and 4:30 p.m. to 5:00 p.m.
• If you are NOT in a client meeting and an A CLIENT calls:
• Sally (FA) is in a client meeting.
• I expect her to be free at (next callback time, either 11:30 a.m. or 4:30 p.m.).
• Let me interrupt her, or can I have her call you back then, or can I help you now?
Saying you will interrupt her also states that client is important.
• If you are NOT in a client meeting and a NON-A CLIENT calls, CA says:
• Sally (FA) is in a client meeting, I expect her to be free at (next callback time, either 11:30 a.m. or 4:30 p.m.).
• Can I have her call you back then or can I help you now?
Figure 7-11 | Section 5 Business Plan: Model Week/Time Blocking.
Figure 7-12 | Section 6 Business Plan: Marketing Calendar.
• Roundtables/Targeted Seminars
• Advisory Boards (client based and professional based)
• Networking Events (personal and corporate)
• Dinner Events/Intimate Dinners
• Client Appreciation Events
• Seminars
• Public Forums (organizations to which you do or could belong)
The final piece of your business plan is your 90-Day Action Plan, shown in Figure 7-13, which can include additional details about responsible parties, support requirements, target due dates, and completion dates.
Figure 7-13 | Section 7 Business Plan: 90-Day Action Plan.
To develop your business plan:
• Call out the three to five marketing and sales approaches you will use as part of your client acquisition strategy.
• Detail how you will use the approaches; who will be responsible for each approach; when each approach will be started, completed, and measured; and the steps that will be taken to execute the plan.
• Define if and how you can expand the relationship with existing clients with additional solutions like banking and insurance, as well as gathering assets away.
• Know that while marketing and sales are the core of your growth goals, you must concurrently retain your current clients with a focus on your high value clients.
• Remember that a business plan is much more than a set of goals. Goals are the “What” and “How Many.” For example:
• What do I want my 20XX AUM to be?
• What do I want my 20XX production to be?
• How many new clients do I want to acquire?
• A business plan lays out the “How,” the “When,” and the “Who.”
• In addition to the business plan outlining where you are and where you want to be, it defines the strategies and tactics for how to get there. For example:
• I will establish two strategic CPA relationships and one strategic Estate Attorney relationship by March 31. This includes identifying 10 quality CPAs of my top 20 clients and 10 quality Estate Attorneys of my top 20 clients.
• I will acquire N new clients by seeking introductions from two CPAs and one Estate Attorney with whom I develop a strategic relationship (following the methodology in Chapter 9 of this book).
• I will employ the LinkedIn process (discussed in Chapter 9 of this book) with 10 of my top 30 clients with whom I am connected on LinkedIn. I will complete this project by June 30.