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Lost a great client? How to respond like a pro

In the course of one's practice, every advisor will find themselves in a tough spot. Even the best laid business plans can be disrupted by the sudden loss of a major client. For any advisor caught in trying circumstances, it's natural to feel upset. But there's a more constructive way to respond to challenges.

Sometimes we’ve sighed relief when a client decides to cut ties, as they’re not our ideal client. But when others leave, it feels as though we’re saying goodbye to a family member. As we’re in the helping profession, these situations can feel like we’ve not done our job to the best of our ability. When a client says, “I don’t need your help," it causes us to reel back and ask, “Why not?” We believe our services are designed in the best interest of our clients, so when a client doesn’t think the same way, the first instinct is to feel offended. But instead, consider how their departure makes room for another client who has been searching for our exact services among the plethora of financial advisors?

For advisors who solely focus on financial planning, the relationship can come to a natural conclusion. The pain point with which the prospective client came into the office has been addressed. They have paid for our services and feel equipped to navigate their financial life by themselves. This decision is a powerful reflection on our skills as planners: we’ve educated and empowered an individual (or partners) to a point where they feel confident to go it on their own. For situations like this, we should be acting like a mother bird — let’s encourage our young children to fly, because if they don’t leave the nest we won’t have room for more.

But the dynamic can change when this departure is a staff member. This person worked alongside you to guide clients and now feel they should work somewhere else. As a business owner or manager, it’s easy to take this personally and subscribe to the notion of, “It’s not me, it’s them.” But let’s be honest, it takes two to break up a relationship.

There’s a famous saying, “Employees don’t leave companies, they leave bosses." While this is only partly true, relationships play a big part in why employees choose to stay with a company or find somewhere else. I’ve left two planning companies before starting my own — both with very different departures. One held a pompous sendoff, but the well wishes felt empty and forced and cutting words were said in private. The key relationships had broken down. Another company could not have been more supportive and sent me with best wishes into my next opportunity. I still look back at that firm as one of my favorite places to work.

Overall, the nation's wealthy are expected to add to their growing fortunes in the years ahead.
June 15

View your company as a living entity. At various times, it’s going to need certain skillsets and professional abilities. But when that time passes, these employees will move on to where they are needed, leaving room to bring in an individual who possesses skills needed for the next phase. It's best for all involved; why would you want to retain an employee or colleague who is not completely committed to the company’s vision? Before they leave, it's also an opportunity to evaluate if that skillset is still needed — can the workload be shared among other staff members, and who is the ideal person who can be added to the firm? A colleague leaving forces a period of self-reflection that is hard to come by in our fast-paced business. When a team member leaves, it should always be viewed as the progression of the business.

These scenarios aren’t always driven by people. For example, if the market declines significantly, AUM-based advisors are confronted with additional work educating and consoling clients but for less income. No one is at fault in this situation, and it’s not something that can be fixed — only time and improving economic conditions can resolve it. While income may have declined, there still are so many positives in this situation.

If the client relationship has gone through a dry patch, it is the perfect time to rekindle the flame and show them how much you understand and are working for them. Bringing a sense of stability to a client relationship in a troubling time can cement it for years to come. You can educate clients about the workings of your team and introduce them to other members who work for them. It’s also a time to get to know clients and their personal situation. By uncovering what’s important to them, you can deliver a more meaningful financial plan in future meetings. (An added benefit: they may also tell you about friends and family members who are looking for financial guidance at this time.)

This time is also an opportunity to show less experienced team members how client service can be done under trying circumstances and also how technical analysis can be carried out when short-term investment returns might interfere with the success of clients’ financial plans. A market downturn is part of a normal economic cycle and keeps advisors from coming complacent.

It's obviously difficult to find the silver lining in a tragic situation or during personal hardship. As people, it is almost impossible to compartmentalize and achieve peak performance in our professional lives while suffering trauma in another. Our work will suffer and our relationships will be tested. We should be reaching out others to help carry our burdens at that time. This is where a positive outlook can help. By leaning on others, we realize the generous nature of those we work with and who support us in our personal lives. By going through something traumatic, it forces us to not be an emotional island and use the gifts of those around us.

The experience can also help us to better understand clients going through their own difficulties. When we are forced to prioritize our life, placing what matters most at the forefront, we can understand that while clients pay us for guidance, they are also human and may want to help in ways that goes beyond the professional relationship. We should embrace human nature at this point and not be constrained by a professional relationship — and in doing so, find that the professional relationship is strengthened for years going forward.

We will experience unfortunate circumstances throughout our lives and we can choose to let them dominate our thoughts and actions. But by deliberately looking for the silver lining in every situation, we can take the power over the moment and choose how it affects our lives.

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