Practice Management: The Loyalty Equation

">Block out time to concentrate on the clients you want
to keep and replicate.  Schedule it on your calendar
A client-centric approach inspires loyalty. Whenand keep those “appointments.”  And if you are
financial advisors build a business model that supportsdistracted by the hustle and bustle of your office, work
their clients’ needs, they spend less timeelsewhere — at home, for example.
scrambling to keep clients or replace those they have1. Develop empathy.  Time in a relationship is
lost. Eve B. Rose discusses seven best practices toimportant.  However, making an emotional connection
help them win the loyalty of their best clients.may be even more crucial.  Like everyone else, your
The chicken or egg — which came first? clients think about you with their right brain as well as
That old saw (paraphrased, of course) applies equallywith their left.  The left side of their brain deals the
well to investment management consultants.  Whichfacts and figures.  It wants to know what you are
comes first?  The clients or the practice?doing with their money and why.  The right side of
Your immediate reflex may be to say . . . the clients. their brain has to do with their emotions, and the
And of course, if you don’t have clients, youemotional component is critical.  That’s why
don’t have a practice.  But without a well-runsuccessful advisors work hard to turn their best clients
practice, you may find yourself scrambling to keepinto friends.  That database you have is valuable, but
clients or replace those you’ve lost with newleverage it.  Don’t just send a birthday card to
ones.  Then again, if you are committed to “bestyour top clients.  Give ’em a call.  Take them
practices” in how you run your business, clients mustout to lunch.  Drop by to say hello. 
come first.  The clients and the practice are1. Keep your promises.  Do whatever you have to do
irretrievably entwined.to keep your commitments.  After all, we expect our
The right strategies will inspire loyalty in your clients. friends to keep their promises — especially
Loyalty as a client retention practice cannot succeedfriends who are taking care of our money.  So create
unless you manage your practice to accomplish it dayprinciples and standards by which you and your team
to day, month to month, year to year.will work.  Write them down.  Share them with your
Build a business model that supports yourclients.  Make sure your team participates in their
clients’ needs.  When you make adevelopment and understands the importance of
commitment to building an advisory business, it meansadhering to them.
you have decided to focus less on the daily1. Cater to your clients.  The key word here is
management of investment decisions and more on the“cater.”  Lip service is often given to the principle
relationships you have with your clients.  That meansof being attentive to client needs.  The word
your workday should change too. “cater” accurately describes the way you should
Answer these three questions:operate your business.  It goes beyond the idea of
- Are you spending hours on the phone talking toattentiveness into the realm of outstanding,
clients about their portfolios? single-minded service.  Give your clients what they
- Do you have 300+ client relationships? want from you.  Some, for example, want bimonthly
- Were you surprised to learn that your biggestcalls about their investment progress; others only want
client’s mother needs long-term care?to hear from you once a quarter. 
If you answered yes to these questions, then your1. Stay one step ahead.  “How extraordinary,”
business model is probably inadequate. your clients might say if you knew what they needed
A loyal person is someone who is “unswerving inbefore they did.  It’s not so hard — as
allegiance,” and to win and hold somebody’slong as you are as loyal to your clients as you want
unswerving allegiance, you need to deliver advice andthem to be to you.  Think about the challenges your
service to a client, the way that client wants itclients are facing.  Not just the investment challenges
delivered. but also those related to who they are as individuals,
Here are some ideas on how you can manage yourtheir stage of life, the businesses they’re in, and
practice to inspire loyalty in your best clients.the families they have.  You and your team should
1. Less is more.  When you have fewer households inalways be looking for ways in which to help them in
your client base, you can concentrate on your bestevery area of their lives.  Do this for a while and it will
clients, devoting the time and attention to them thatbecome second nature, as natural to how you run
they deserve — and probably expect. your business as anything else you do.
Determine how many clients you can support the way1. Show up.  In the end, you need to “be there.” 
you want.  Calculate the assets a client must haveLoyal clients can sustain dips in the value of their
for you to give them the right level of attention withoutportfolio, but they have to see that you are part of
worrying if you’re making a profit. their lives and that is more than being just a phone call
1. Allocate time.  It takes years to really get to know aaway.  Structure your routine so that you can meet
client.  Your first meeting is a greatwith your best clients on their own turf.  Socialize with
“get-to-know-you” session, and it does help youthem and get to know their families.  Pay visits to
lay the proper foundation for a strong relationship, buttheir homes, and make a point of being there for the
the longer you know clients, the better you understandimportant occasions in their lives — the good
them.  Over time, you can learn what’s reallytimes and the bad.
important to them and what they need from you.