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Be Indispensable, Not a Commodity

By Crucial Clips     September 2, 2014
The following text is a transcript of a portion of a speaker's presentation made at an industry conference or during an interview. This transcript solely represents the view of the individual who spoke, and not the view of Financial Advisor IQ or any other group.
Source: FA-IQ, Aug. 27, 2014 

CHRIS LATHAM, REPORTER, FINANCIAL ADVISOR IQ: This is Chris Latham with Financial Advisor IQ. I’m here with Michael Silver, a cofounder of Focus Partners, an advisor consultancy based in Paramus, New Jersey. Michael spent 13 years as an advisor before cofounding the consultancy.

Hi, Michael. How are you doing?

MICHAEL SILVER, COFOUNDER, FOCUS PARTNERS: Good. Thanks for having us in today. I appreciate the opportunity to come back in.

CHRIS LATHAM: You’re welcome. Now, Michael, you deal with advisors across the spectrum and in all channels. How can an advisor make sure that they are not a commodity in a sea of thousands of other advisors?

MICHAEL SILVER: If you’re going out there and telling these people things they’ve heard before, you’re putting yourself right in that commodity box — and you’re no different from anybody else. But when you’re going out there and you can tell these people — clients and prospects in particular — things they haven’t heard before, something different, a way to really differentiate yourself, that’s how you can decommoditize yourself.

And advisors need to realize that just going out and trying to say, hey, let me see your statements, let’s manage the money — you’re a commodity. But when you build a much more holistic practice, show your value as an advisor — and we like to elevate the term “advisor” and call them relationship managers, because it’s not just about finance — but as you get to know people personally also, that’s when you really differentiate and can separate yourself, because, again, there’s a relationship. You’re not just managing the bond portfolio or managing investments. It’s a much broader approach, in my experience.

CHRIS LATHAM: All right, so now let’s take it a step further, even. How can an advisor make sure that they are indispensable — that they’ve created the indispensable advisor-client relationship?

MICHAEL SILVER: I like that. We call that the “can’t live without you” approach. First of all, you want to offer — especially, we see this a lot in the wirehouse world, where you’re part of a global organization with vast resources — but you want to offer a family-office feel or more of a boutique feel for your high-end clients in a much broader spectrum of a larger firm. But you want to be one-stop shopping for your clients.

Every day at Focus Partners, we are coaching advisors and teams and firms on how to build these types of relationships. If you go outside of, again, just the investment-management silo and are offering estate planning, and retirement planning, and investment management, and insurance, and lending and all these different things, you are becoming indispensable. And you own that relationship.

Aside from that, the whole other side of the coin is getting to know your clients personally. When you have a relationship outside of just being their advisor, you’re indispensable.

You want your clients to pick up the phone and call you to say

“Hey, I’m at the car dealership. Right now, I’m standing here with a salesperson. Should I rent, should I lease, or should I buy?”

“You know what? We’re on vacation in Florida. We found this amazing home. We might buy it. Can we afford it?”

Or “Hey, I think I’m going to sell a home.”

Then you own that relationship. That’s when you’re indispensable, when your clients come to you for anything.

CHRIS LATHAM: Michael, thank you very much for being here.

MICHAEL SILVER: My pleasure. I always appreciate the opportunity. And enjoy the rest of your summer. Thanks.