How one advisor tripled AUM in a decade

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Some advisors tell me they have a difficult time talking to prospects. These advisors say they’re frustrated because their marketing and sales techniques just aren’t working.

So, what does work?

For one, it takes time.

Top performers in fields such as medicine, athletics and science put 10,000 to 15,000 hours into perfecting their skills, author Geoff Colvin showed in his best-selling book Talent is Overrated. And even after reaching the top rung of achievement, these superstars remained immersed in their work, day in and day out.

Chuck Yeager, the first pilot to break the sound barrier, in his autobiography attributed his skills to years and years of practice. As a test pilot, he flew unproven and often very dangerous experimental aircraft. He engaged in air combat. He chose duty stations requiring daily flights. All that added up to more than 20,000 very difficult hours of flying over almost 30 years.

Stop and ask yourself how many hours of formal training you’ve received on prospecting and conversing with potential clients. Is it more than 2,000 hours?

In the past 10 years, how much time have you spent actually talking with clients and prospects, either on the phone or face-to-face? Is it more than 10,000 hours?

When you rigorously track your hours and appointments, you’ll see how much work you’ve done perfecting communications with others. More importantly, you’ll know the results of those efforts. If you don’t have explicit and continuous records, you probably aren’t happy with the results. Worse yet, you don’t know why things aren’t working.

I recently reviewed my calendar to see how many client or prospect meetings I’d had in the first four months of the year. Here’s what I found:
Surprise! The calendar I was reviewing was from 1998. At that point, I’d been an advisor for 15 years and a CFP for 11 years. I also owned my own firm, which had $170 million in AUM.

Assuming those meetings averaged two hours each, I calculate that I spent about 1,500 hours meeting with prospects and clients that year. In other words, about 50% of my work time was devoted to client relations and relationship building.

About 50% of my work time was devoted to client relations and relationship building.

Tracking has served me well in my professional life. My business nearly tripled in size over the next decade, reaching $500 million in AUM by 2008. I continue to rely on this analysis: At my firm today, every advisor has his or her goals reviewed regularly by a supervisor. Monthly performance numbers are published for every staffer to see.

I began this practice of tracking client activity and revenue generation in 1985, shortly after I started in the financial planning business. In three short years, I had a significant amount of data, and I could see the business generated by my regular training and my meetings with prospects.

Additionally, I could see when my activity was going to pay off — that is, how long it would take to get me from the first meeting to cash flow, and what each meeting’s probability of success would be. Initially, I found, it took eight to 12 weeks to start making money, because I was mostly selling commissioned products. (This was the 80s, before the fee-only business really took hold).

As my revenue increased, I saw I needed support. By 1989, I was a boss with accountability to other people in the firm, including employees who expected a steady flow of revenue and work. Sharing with the staff how I tracked my hours and my success in winning new business became a natural extension of my self-accounting.

Those numbers became a powerful motivator.

I wasn’t asking staffers to hold me accountable. Rather, I wanted them to know I was accounting for my actions. I also wanted them to know that whatever they could do to move prospects to clients, and then serve their needs effectively, was important because I paid attention to those numbers. They did too. Those numbers became a powerful motivator.

I recommend you start tracking your client/prospect-facing activities, along with your training in that area. Keep very detailed records. If you’re already collecting this information, expand your data set and figure out precisely what your activities are doing for you. If you can’t, get help from a coach or experienced advisor who knows how to keep score. Then share your activity with everyone who can help you move your business forward.

Many years ago, a 31-year-old self-made millionaire told me, “The commitment to continuity builds emotional stability.” Put another way, being held accountable for your work is the cornerstone to a productive and emotionally stable life.

Napoleon Hill, in his classic book Keys to Success: The 17 Principles of Personal Achievement, stated one of these keys was to employ self-discipline. “Self-discipline is the process that ties all efforts together for you,” he wrote. “The power of the will trained by self-discipline is an irresistible force.”

All of this is well and good, but how do you know you’re doing enough of the right things? Think of your career as like taking a long-distance road trip. One tank of gas won’t be enough to get you to your destination. You must stop, refill your tank and make sure you’re on the right road.

In a similar fashion, for the success of your decades-long professional career, you must get repeated training in both business development and the technical skills necessary to serve clients. That’s refilling the tank. You also must regularly review your work efforts and resulting outcomes to make sure you’re hitting your goals. That’s making sure you’re on the right road.

Simply reviewing your numbers and doing nothing about them isn’t holding yourself accountable. Imagine you’re in your car: That would be like knowing you’ve made a wrong turn but doing nothing about it. That wouldn’t make sense, would it?

Simply reviewing your numbers and doing nothing about them isn’t holding yourself accountable.

Persistent and consistent accountability is a fundamental requirement for success at every level of your career and your life. You ask for it from your clients every day. It’s time you demand it from yourself. You’ll be amazed at the results.

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