Principle 25: I’d Rather Say Whoa! than Go!

Lessons in Bird Hunting

I have two beautiful bird dogs, Sage and Cash. Sage is a white Setter, and Cash is a tri-color Brittany with big liver-colored spots. During the off season they lay around the house, lazily propping their chins on each other’s hind quarters, occasionally yawning or grunting in domestic bliss. You’d never know these dogs love to hunt. Each October at the beginning of bird season, we do a little hunting near Columbus, Texas, about 90 minutes west of Houston. Needless to say, the weather is still warm in southeast Texas at that time of year. After an hour or so of running full out in the field, the dogs begin to melt under the hot sun. They get thirsty and fatigued and need frequent breaks for water and rest. By the end of the second hour, their noses stop working, and they lose interest altogether. During the first hour, they range 20 yards in front of me, criss-crossing back and forth in a graceful ballet, greedily covering the terrain before them. By the second hour, they no longer work as a synchronized team and slow to a labored saunter, just under my feet. “Hunt ’em up! Bird in here!” I call. No response. All I can do is watch them with their sorry heads hung low, paunches swaying back and forth as they shuffle along, eyes bloodshot, tongues drooping. I nudge Cash with one of my boots and he just collapses on the ground. Sage follows suit. It’s pretty sad. The hunt is over. They have nothing left, and it is only mid morning.

What happened to those maniacal ornithophiles from the end of last season, when the temperature in north central Kansas was a cool 20 degrees, and they were hunting birds like heat-sinking missiles? They were so into their work that I had to constantly give the “Whoa” command to keep them from breaking their points and flushing birds, or even catching birds outright. Now, under the hot Texas sun, I can’t get them to respond.  As we say in Texas, “That dog won’t hunt.” Trying to get them to do anything at this point would be like pushing a wet noodle up hill. It can be pretty frustrating trying to get someone to do something that just isn’t in them. The problem is that, for early season bird hunting in southeast Texas, I should not be using a Setter and a Brittany. Instead, I should be using a couple of Pointers. Pointers are built for the hot weather with their lean, short-haired bodies and all-day stamina. I am simply working with the wrong staff. I prefer to work with a team that I have to reign in rather than push. In other words, I’d rather say “Whoa” than “Go.”

Admiring Your Staff

If you don’t admire them, you have the wrong staff. If you can’t honestly boast about their abilities, temperament, and accomplishments, you need to make some changes, right now. Staff fall into several categories. You have the hapless and inept, who don’t know how bad they are. You have the brown-noser do-nothings, who do know how bad they are, but think you don’t. You have the mumbling martyrs, who aren’t as good as they think they are, and who  constantly break the rules, but are sure they’re always doing you a favor in the process. You have the competent plodders, who don’t know how good they could be if they just had a little drive and ambition. And then, you have the smooth operators. These are the people who know how good they are. They’ve got moxie. They understand the system and make it work for them and your practice. Think “Radar,” from M*A*S*H. They anticipate all your moves, solve problems before you know they exist, keep you informed and on task, never make excuses, own their mistakes, and have your back. You need an office full of these people. Sit down right now and draw up a list of your staff members. Assign each of them one of the above categories.  Any staffer that doesn’t rate smooth operator, or can’t become one in a couple of months, has to go.

As I learned a long time ago, it’s hard to soar with eagles when you work with turkeys. Solution: work with eagles. They are out there in every compensation, experience, and education strata. You just have to be willing to take a stand against mediocrity. I can hear you whining right now. “I can’t afford better staff.” Yes you can. Better staff will make you more profitable and able to pay them. “I don’t have time to train a new person.” Baloney. You trained the ones you have now, and if you had better people, they’d be training the new staffers. “I can’t let anyone go or the office will collapse.” Nonsense. If you don’t bite the bullet and make changes right away, you won’t get any better. Hire and train an eagle, then decide who to let go. Then, keep on hiring and training eagles and replacing your turkeys until all the turkeys are extinct.




Principle 24: It’s the Relationship, Stupid! (Part III)

We are Proud of our Best Relationships

Jesus warned us not to brag on ourselves, and He, of course, was right. But, it is perfectly acceptable to brag on others. We all brag on our kids, and especially our grandkids (I have only observed this truism with grandkids since I don’t have any grandkids of my own, yet.). We do this because we are simply crazy about them. We love to spend time with them. We love to watch them play sports, achieve things, and graduate from anything. It is not just because they are cute and sweet (they may not be).  It isn’t even necessarily because they are our blood relations. Lot’s of families have adopted kids and grandkids. We enjoy the time we spend with them because they are our kids. We have built great relationships with them, and being with them is just fun. We have cheered their triumphs, and we have walked with them through tough times. We’ve been there when they’ve needed us (and sometimes the other way round).

The kid next door could be smarter, prettier, handsomer, funnier, whatever. But, we don’t have the relationship with him. He has never crawled up in our laps for the sheer joy of just being in our presence. He has never wanted our opinions on anything. He has never tackled us around the legs when we’ve walked in the door. He has never, well…you fill in the blank. The point here is, we brag on those with whom we have great relationships. We’re proud of them and we want others to know it. Your objective is to build relationships of such quality that your clients are crazy about you and proud of you. So crazy about you that they can’t wait to see you. So proud of you that they can’t wait to tell their friends and family about you.

The Cocktail Party: Field of Prey or Hunting Ground?

Now, I don’t attend cocktail parties, but a lot of my clients do. Some of them have weekly golf outings with their favorite foursome, or play bridge with their best girlfriends. Some have other regular get togethers with family and friends. In these intimate affairs, people let their hair down. They complain about their spouses, their golf game, their taxes, and their neighbor’s dog. What you don’t want them complaining about is you.

When my clients are in those intimate social settings, I am not worried that their dissatisfaction with me will be aroused, even if there is a pretty good reason. I am not concerned that their friends or colleagues will woo them away to another advisor. I am confident that my clients will proudly boast of their relationship with me because I have built substantive and lasting relationships with them by investing extra personal time with them, in every meeting, EVERY SINGLE TIME! When they attend that gathering and investments come up, I am not concerned that my clients are walking into a dangerous field of prey with wolves lurking about, but rather a fertile hunting ground where they will bag my next referral.

Certainly, relationships aren’t the only reason clients stay with you. But, they are the main reason they stay with you long term and send you great referrals. The longevity of your client relationships and the frequency and quality of the referrals they send you are in direct proportion to the quality of the relationships you build with them. Of course, you need to give good advice, produce a reasonable return, run a well-staffed operation, and so on. But, a healthy, growing, and sustainable practice will require your very best work in the relationship department.

Principle 24: It’s the Relationship, Stupid! (Part II)

Clients Aren’t Cattle

And, if you treat them like cattle, they’ll treat you like a cattle prod or an electrified fence. They will simply avoid you. They will not want to come in for reviews. They won’t call you when they receive an inheritance or need to rollover their 401k. They’ll second guess you and resist your advice. They won’t send you referrals. You’ll be reduced to product selling, peddling your wares like a door-to-door salesman. Wait. Maybe product selling is what you do now, and you feel like you’re on a runaway train: you can’t jump off or you’ll surely die, so you hang on and hope for a miracle. I am here to tell you that you can escape the certain disaster of mediocrity. You can turn it around and develop the practice you’ve always dreamed of, if you will just start to focus on the relationships.

The problem with too many advisors is they are in a hurry. They are in a hurry to see the next client and they are in a hurry to make the next sale.  The clients don’t really matter so much. It’s their money that advisor is after. Some advisors run up to 40 appointments a week and skip lunches (no kidding, I know some). This is madness. You can out produce these folks with a fourth of the appointments, and you’ll sleep better at night. You’ll get all the client’s assets. You’ll have a happier staff. And, you’ll have more free time than you’ll know what to do with.

A Little Experiment

Try this: the next time an existing client comes in for a review (You do those, right?), schedule it for 90 minutes. Spend the first 45 minutes with their file out of site, and your notepad, calculator, and pen still in the credenza drawer. Have your staff bring in some hot coffee or an icy cold beverage and something sweet to munch on, say, some fresh baked cookies (get a toaster oven). Once the client sits down and is served, clasp your hands on top of your head, lean back in your chair, smile broadly, and say, “It’s really great to see you. Tell me what’s new in your life.” Then just listen. Ask more questions. Keep the conversation going. Tell a related story or two. Show genuine interest in the client’s personal life. Laugh a lot. Share a little of your own story (remember, intimacy is spelled in-to-me-see). Make friends. And, keep doing it every time you see them. Soon, they’ll start to look forward to the visits. They will enjoy themselves in your company. They will leave your office with a sense of satisfaction and contentment, and they will start to care about you (this stuff really works). It’s called love. Spend it lavishly on others and it comes back to you in spades.

There IS a Silver Bullet

Clients won’t hire you, or if they do, they won’t stay long, if they don’t like you, trust you, and find you competent. But, even if you are hitting on all these cylinders, if there’s no relationship, you’ll eventually be toast. Why do people go to class reunions, keep seeing the same doctors, stick by their friends through thick and thin, frequent the same restaurants (even if the food isn’t that good), and stay in difficult marriages? Relationships. Sure, you need to be good at your work, produce reasonable returns, throw a good party, have a nice bedside manner, and all the rest of it. But, what truly builds the business and gives it longevity is your ability to make friends with your clients and build strong relationships with them. There’s your silver bullet. It’s the relationship, stupid!

Principle 24: It’s the Relationship, Stupid! (Part I)

Why Do Clients Come Back?

The reason surely isn’t the investment returns you bust your can to produce. It isn’t your spiffy college education, your crazy wow-factor master’s degree, or your prestigious alma mater.  It isn’t your over-the-top, no-holds-barred, insanely expensive annual client appreciation event. It isn’t your penetrating insight into the financial markets or your utterly remarkable financial planning expertise. It isn’t your crack administrative staff. It’s not even your extensive list of licenses, professional designations, or other industry credentials (Sorry, I know you’re proud of all those.). Public speaking skills? Office location?  Cool business card logo? Nope, nope, nope! (drum roll, please) It’s the relationships you’ve built.

Eating at Fred’s

I have been dining at Fred’s Italian Corner for 25 years. I live in the Houston suburbs, and Fred’s is 40 minutes one-way across town through the busiest 3 miles of Texas interstate, deep in the famed Houston Medical Center. My family eats there once or twice a week. I first started eating at Fred’s in the 1990s when my cousin, Eddie, had leukemia and needed regular blood transfusions at nearby M. D. Anderson Cancer Center. I’d donate some blood, then stop in at Fred’s for a hot plate of steaming Sicilian spaghetti and meatballs. I grew to love Fred, the slender, quirky, Sicilian owner of Armenian extract, who’d sit behind the register, taking orders with his skinny, and ridiculously tall chef’s hat, chatting up the customers and barking orders over his shoulder to his kitchen staff, who, in his opinion, were imbeciles, and never seemed to get anything right. He always had a big smile and wanted to know what was going on with you. After 10 years, he died of cancer. I was stressed. Not only had a lost a friend, but I feared for the restaurant’s future. The place had become my own personal kitchen. Everything was just so, and nothing ever changed.

His son, Andy,  took over for a while, but I was worried it would fail. I resented his son’s presumption to take over “my” restaurant. Andy knew I was uneasy about his taking over, but he persevered. He’d come by our table and make small talk every time we came in. I got to where I’d call down to the restaurant on the way there, and he’d take the family’s whole order over the phone. When we arrived, our table was ready and the food was promptly delivered. When Andy was thinking up a new dish for the menu (he liked to tinker with the sauces and this annoyed me beyond reason), he would whip one up for us on the house, and then ask for our honest opinions. He eventually won us over.

One day, we came into the restaurant and saw some new faces behind the counter. Andy explained that he had decided to sell the business, and to foreigners at that! I was miffed. Not only were they not Sicilians, or even Italians, they were Iranians. The first thing they did was install a TV in the restaurant. Can you believe that? I was disgusted. For several months I was leery and very stand-offish with the new owners, not giving them the time of day. I would ask for my favorite (pre-ownership change) waitress and just ignore the new owners. But, they kept coming to the table, visit after visit, always smiling goofily and lavishing upon my family a gross amount of warm, personal attention (A gross amount, I tell you!). They kept piling on, first one family member, and then another. We got to know all their names, and they finally pierced my armor. I call the old man “Papa” now. His son, Amir, recognizes my voice when I call ahead with my order, and he doesn’t even ask if it’s me. He just says “Hey, buddy! What would you like tonight?” To tell you the truth, the food isn’t even that good anymore. But, where else can I go and feel like I am in my own kitchen and among my own friends, EVERY SINGLE TIME?

The Morals of the Story

It should be obvious from my experiences at Fred’s over the years that building good relationships is essential to building good businesses. But, I’d like to draw out two additional morals from these experiences. The success of both Andy and Amir in working hard at winning my friendship ensured that I’d be a longtime customer of the restaurant, even through ownership changes, a decline in the food quality, and a host of other things got under my skin.

Moral #1: If you decide to pass along some of your B and C clients to an associate advisor, the associate advisor’s top priority will be to focus on building a quality personal relationship with each client before trying to do any significant business. This is the best way to ensure the relationship stays in the house, so to speak. People usually hate change. A change in advisor can be devastating for a client. The only thing the new advisor should be in a hurry about is making friends.

Moral #2: Relationships trump everything else. Great relationships will endure poor service, long lobby wait times, and lousy investment performance because they are rooted in love. We all need this reminder: “Love is patient, love is kind and is not jealous; love does not brag and is not arrogant, does not act unbecomingly; it does not seek its own, is not provoked, does not take into account a wrong suffered, does not rejoice in unrighteousness, but rejoices with the truth; bears all things, believes all things, hopes all things, endures all things. Love never fails.” – 1 Corinthians 13:4-8 Build great relationships on the foundation of love and they will endure the test of time.