Practice Management – The secrets behind success

What makes Australia’s top planners so successful? The answer, as Gerard Doherty discovered, lies partly in successful client management.

In a recent series of face-to-face meetings with Australia's ten most successful advisers Perpetual Investments discovered that a number of common factors lead advisers to the top of the profession and moved their businesses to the next level.

Putting the lifetime work of ten leaders into a few hundred words is a daunting task and a great deal of the detail and essential ingredients must be omitted, but basically what Australia's top advisers have done is structure their businesses effectively and efficiently.

The key step these successful planners took was to change their thinking from being a financial planner to being the chief executive of a business that does financial planning.

There were five common themes in this approach:

Client relevance

All ten people interviewed had no doubts about the business they were in. They weren't looking for new explanations, new activities, or additional services outside their basic financial planning business. As one planner put it very succinctly "You need to maintain your relevance to your clients and the relevance of the service that you provide."

This twin approach of client relevance and service relevance sums up the philosophy of success.

Client management

All the successful financial planners we spoke to talked in terms of having a systematic approach to client management. The focus here is to look after the needs and wants of individual clients and exceed their service expectations. It was not about giving clients "what we want them to have" but understanding what the client wanted, and being in a position to provide it. The critical step in doing this efficiently is systems that allow a tailor-made customised approach externally, supported by standard internal controls.

A common theme was two way client communication to find out exactly what clients wanted in ways such as reporting, face-to-face reviews, newsletters, seminars and other services and contact.

All those surveyed believed in the need for client services to be triggered automatically rather than depending on individuals (as individuals can, and do, leave). In other words, to create in a client's mind a feeling of being a client of a business rather than a person.

Getting the team right

Being client obsessed for the top financial planners didn't mean that they believed in being personally available all the time. What it meant for them was having the right balance of support available, and structuring the business so that complementary skills were accessible by clients.

It also meant understanding clients' needs and categorising clients so that they could access, and be allocated, appropriate service levels. As a simple example of the need for complementary skills, one adviser talked in terms of having "hunters" who were able to win and convert new clients, and "gatherers" - those who can mind the clients and provide meaningful ongoing service.

Each successful adviser believed the team approach must run through all staff, including receptionists and administration support. All agreed it was a mistake to rely solely on individual skill levels to provide superior service. Client relationships need to be institutionalised within the organization so that things will happen automatically and to the same standard.

Delegation

As a result of the approaches outlined here the financial planner is able to make running the business a major responsibility and not something that they do after hours. It gives them the power to delegate with confidence. As one put it, "Frank Sinatra didn't move pianos".

The ethos expressed was to be in a position to delegate everything you can find someone else can do as well as you, or better. The advisers found that doing so encouraged business expansion and team development.

A dedication to building a business.

While client service and management were fundamental to the planners' success, all of these themes were platforms for an overriding desire to build a stand-alone business that was not totally dependent on the skills of the principal. This involved employing a mix of people with complementary skills, being able to delegate, being able to allocate clients to other people confident they will get the same level of service, and undertaking a systematic approach to client servicing and business development.

It was a common view with all the financial planners we interviewed that it was this fundamental change in operating that allowed them to dramatically increase the scope and revenue generating ability of their business.

<I>Gerard Doherty is general manager retail business for Perpetual Investments.