Annuities

The Question that Raised the Hair on My Neck … and Can Raise Your Business Standards


Annuities

Early on in my career, I participated in training for wholesalers that emphasized the need to create a business plan with each of my top advisors. 

 

The plan was not complicated. In fact, it was bare bones, simple and to the point. It established a commitment between me (the wholesaler) and the retail representative, outlining how each expected certain activities from the other to make the relationship mutually beneficial. It was never more than a single page.

 

Sounds easy, right? Well, it required me to ask the advisor a new question. Changing habits can be hard … but I knew I had to try. 

 

Taking the First Step

After the training, I went out into the field. I had doubts about the value of making a quarterly business plan with every one of my top producers. However, as a new wholesaler with the company that sponsored the training, I felt compelled, even obligated, to try it. 

 

When I arrived at my next meeting, I took nothing other than my pad of paper. The advisor and I talked about her business for about 45 minutes. I learned a lot by asking the right thought-provoking questions, and I gave her some ideas that I thought she might use, based on her business and clientele. This advisor sat in a bank and during my time at her desk, I discovered she did millions of dollars of business with a competitor. 

 

As we wrapped things up, it was time for me to ask her for the next appointment and for us to sit down and do a business plan together. A “yes” meant that she liked the interaction with me, and my company, and had interest in our products for her clients. A “no” meant that I destroyed the relationship before it got off the ground. 

 

In the past, I would have asked for the next appointment but with no specific purpose. Or, I would have relied on my internal partner to follow up with the advisor and set another follow-up appointment. But, I had made a commitment to myself to change the way I sold – times were changing and advisors were looking for better partners.

 

So I gathered my confidence up and asked for the next meeting in three weeks, when I would be back in the area. And, I asked that we set aside 90 minutes so we could jointly create a business plan that would help keep both of us accountable to reaching some of the goals she had outlined.

 

There was dead silence for what seemed like an extended period of time … like eternity. I could feel the hairs on the back of my neck standing up, and it felt like I was about to break out in a cold sweat. 

 

Her response? She was happy to do it. In fact, she said she didn’t move forward with a wholesaler before making a formal business plan with the company’s representatives. I was floored. It was as if it was set up by the training school. 

 

Planning for Success

This advisor went on to become a multi-million dollar producer for me. In our business plan, we agreed to set out the very next quarter to host a client event, where she would have 50 clients and prospects in attendance. In the following quarters, I would provide training to her staff and mailers to use with existing clients, and I would host a networking event for centers of influence around town. For those commitments, she said she anticipated placing a portion of her business with me and my company. 

 

I encourage all financial professionals to have this same requirement of their partners and distributors. As we move deeper into the fiduciary world, it’s more important to surround yourself with firms, wholesalers, and other advisors whom you can trust with your clients. 

 

Business planning comes in many forms. But, planning with your partners might be the most crucial aspect for the ongoing support you need in this complicated financial services world. 

 

Winning Strategy

Create a business plan with each of your vendors. Those who complete the exercise with you should be considered partners. That’s what you are looking for in today’s complex distribution. You need partners who understand you business and can help it grow. 

 

About the Author

Mike McGlothlin is a tireless advocate for the retirement planning industry. As executive vice president of retirement at Ash Brokerage, he heads a team providing income planning solutions focused on longevity and efficiency. He’s also a thought leader who provides guidance and assistance for advisors and broker-dealers navigating marketplace and regulatory changes. You can find a collection of his blog posts in his book, “Above the Clouds … Winning Strategies from 30,000 Feet.”

Financial Planning Business Planning Practice Enhancement

How to Deliver Value and Better Your Business


Annuities

As you read this, the financial services world is changing. Regulatory pressure accelerated a shift over the past 12 months; however, the current state of fiduciary status was inevitable. Our clients were beginning to demand it, and today, we have to deliver it to even stay in the game.

 

The challenge, and the main reason to really think about your business in 2018, is to remain relevant with your clients and prospects through the fiduciary standard. The firms that grow will be the ones that not only adapt to the fiduciary rule, but also find ways to differentiate themselves from the rest of the fiduciaries in the marketplace. 

 

Discovering Your True Value

Your value in the market place will never be defined by your broker-dealer or regulation. Value is determined by how much you deliver above the cost of your services. That’s not to say that the U.S. Department of Labor’s rule won’t likely affect how broker-dealers form your commission schedules. But, your level of commission doesn’t determine your value. It’s how much you deliver to your clients. 

 

Value is about the client experience. How you deliver your expertise may be more meaningful than the information itself. Clients want to have information now. It must be accurate. It has to be timely. And, it must be easy to understand and digest. 

 

Value is also delivered by those items that clients truly value. Asset allocation is becoming – or has been for some time – a commodity. It has been outsourced by third-party money managers, computerized, and easy to access via the Internet. In order to drive value above your current pricing, you need to find other topics that are important to your clients. 

 

Retirement income is a nearly irrevocable decision. You only get one chance to get it correctly. If your client begins running out of money, it’s usually too late to correct the path. Income planning requires expertise, tools, and understanding of the emotional impacts of a variety of external factors. Robo advisers are not equipped to handle this in-depth conversation and complex problem. 

 

Bettering Your Business

This is where you need to plan for 2018 and beyond – by reshaping your business for maximum success in the future. It’s no longer OK to simply bring on new clients, apply an asset allocation model, and monitor the assets. You have to think about the demographic shift happening in the United States and the impact on your planning in order to stay ahead. 

 

If you are going to drive value – the ability to give more than you receive from your clients – you have to offer more. That doesn’t mean several more services. Instead, it means identifying what’s important to your clients and delivering with the highest client experience possible. 

 

You need to evaluate the technology, products, services, and processes that will guide you and your clients through the discovery and planning process. Look at the talent level in your office to deliver on the changing needs of your clients, and find partners who can assist in delivering new solutions. Taking a step back and looking at your office in the fourth quarter can make a huge difference for many years to come. 

 

Winning Strategy

When setting goals and planning for next year, take a deeper look. Evaluate the process, the talent level, technology, and the client experience. Make sure you are making a difference that adds value to your clients’ overall client experience with you. 

 

About the Author

Mike McGlothlin is a tireless advocate for the retirement planning industry. As executive vice president of retirement at Ash Brokerage, he heads a team providing income planning solutions focused on longevity and efficiency. He’s also a thought leader who provides guidance and assistance for advisors and broker-dealers navigating marketplace and regulatory changes. You can find a collection of his blog posts in his book, “Above the Clouds … Winning Strategies from 30,000 Feet.”

Financial Planning Retirement Practice Enhancement Business Planning

Why You Must Prepare to Win in 2018


Annuities

It’s hard to believe we are already in the fourth quarter of 2017. It may seem like you’re still trying to wrap your arms around this year, but it’s already time to look at your plans for 2018. Your first step should be to create goals and direction for your practice. We have a full 90 days to prepare for 2018, so there’s no excuse for not having a great year. 

 

Being around Coach Bob Knight for four years taught me a lot about planning for success. Many said that if you gave Coach Knight a week to prepare for a team, he would likely win the game. I encourage you to consider the things that he did to plan, and apply them to your business. 

 

Set reasonable but high goals for the season. As an owner of your financial services business, you need to have overarching goals for the year. Where do you want your business to be at the end of 2018, and how does that fit into your long-term strategy? 

 

At Indiana University, we had three goals for the season: 

  • Go undefeated in the pre-conference season
  • Win the conference, 
  • Go as far as we could in the NCAA tournament

 

Each step built on the next. No goal was unreasonable. And, if successful, the year added to the history of Indiana basketball and gave our fans great enjoyment. Notice that our goals were to win every game. Conference season is difficult, but it is not unreasonable to think that we can win the conference. And, we didn’t set out to win the NCAA tournament every year. However, we wanted to survive and advance as far as our team possibly could. 

 

Assess your strengths and weaknesses – honestly. Coach would consult with many of his mentors to ask how to use certain players. Some players were not good handling the ball; others were lightning quick. Using the players to their strengths was critical to game day and the season’s goal attainment. 

 

You need to take a hard look at your personnel and the strengths and weaknesses, even if you are a sole practitioner. My business coach helps me conduct a 360-degree review of both my direct reports and direct superiors. It’s uncomfortable to hear confidential and anonymous feedback, but it helps me adjust my leadership to the team – where I need to improve or what they like from me. 

 

You might ask yourself some questions like: 

  • What do I need to improve on in order to hit my 2018 goal? 
  • How do I need to re-shape my products or services in order to grow my business to my goal? 
  • Do the same for your support and sales staff – are they the right people and skill sets to take you to the next level? 
  • How do you need to reinvest in your people to ensure that you reach your goals in 2018 and beyond? 

 

Take serious stock in yourself, your people, and what they need from you to grow. 

 

Plan with discipline. After taking stock of what players could do well and not so well, we would play to our strengths and avoid our weakness. For each game, Coach determined the other team’s strengths and how our players could best neutralize those strengths. We then worked for the entire week on those plays and rules that gave us the best chance to win. 

 

Sometimes, players were put in uncomfortable positions, but not out of their skill level. Learning how to play a slightly new role requires repetition. So, we repeated those key factors to winning throughout the week in many different scenarios. Practice was intended to be harder than the actual game. 

 

Similarly, you need to plan your client marketing and interactions with the same discipline. Too often, we think placing products and talking with clients is “selling or marketing.” I argue that we have to set aside time and dedicate resources to disciplined marketing to our intended audience. You have to schedule time to network, work on scripts for advertisements, complete video shoots, rehearse radio shows, and plan for client events on a regular basis. 

 

Once engaged with a specific client, we have to utilize a disciplined, repeatable, and consistent review process to make the best interest recommendations. Just like planning for a new team the next weekend, you have to plan the same way for the next client. Solutions and how make recommendations will be specific to the client, just like playing against a different team requires different tactics. 

 

Prepare to Win. Winning 30 games during the 1987 season requires a lot more detail than this blog allows. However, I think that Coach followed a similar process every year. I’ve tried to follow a similar process in business as well. I set high and realistic goals, know my strengths and weaknesses for those goals and where I have to improve, and execute a consistent game plan that works toward my goals, knowing each situation is different. 

 

Winning Strategy

My favorite quote is sports is, “Everyone has a will to win; few have a will to prepare to win.” I always took this lesson to heart from my time with Coach Knight. Apply it to business to have success in 2018. 

 

About the Author

Mike McGlothlin is a tireless advocate for the retirement planning industry. As executive vice president of retirement at Ash Brokerage, he heads a team providing income planning solutions focused on longevity and efficiency. He’s also a thought leader who provides guidance and assistance for advisors and broker-dealers navigating marketplace and regulatory changes. You can find a collection of his blog posts in his book, “Above the Clouds … Winning Strategies from 30,000 Feet.”

Financial Planning Business Planning Fiduciary