Years into the economic crisis, the business environment remains a challenging one. U.S. home price deflation, which precipitated the crisis, has clocked more than 57 consecutive months. The unemployment rate is frightening. The stock market boom has not changed the economics or reversed the psychology needed to thaw chilled investors.
And so pressure remains on advisors to somehow scale up, bring on new clients and increase revenues. Our cover story addresses this challenge, noting that serving clients effectively requires tremendous expenditure of time, effort and money.
It was not so long ago, after the dot-com crash, that the newspapers were filled with stories of high-flying advisors whose businesses, careers and even lives lived in freedom (some went to jail) came crashing down in flames. In the booming ’90s, attracting clients and making a very good living seemed to be less challenging. Yet many of those businesses we now know were built on very flimsy foundations. Putting all your clients’ money on scotchtape.com proved not to be a good long-term strategy.
It is through this perspective that we can appreciate the common wisdom that it is during recessions that great fortunes are made. So the good news is that anyone still engaged as a financial advisor in this environment grasps something firmer and more enduring than the fluffy air businesses prevalent a little over a decade ago. The better news is that this remains a uniquely good time for expansion.
A celebrated top producer, asked what the secret to his success was, once remarked that he was willing to invest in marketing and his competitors were not. He “owned” his market, he said. Yet even advisors who lack the material resources to market aggressively can nevertheless muster a generosity of spirit. At a time of glum inaction on the part of investors, you’d be surprised at how far an upbeat attitude and willingness to give of one’s time and advice, caring and concern, can go.
When the miserly Scrooge first encounters Jacob Marley’s ghost in Dickens’ classic A Christmas Carol — a book that can be mined for its riches of business wisdom — he says: “But you were always a good man of business, Jacob.”
Scrooge’s former business partner, now regretful of his Scroogelike behavior in life, declares:
“Mankind was my business. The common welfare was my business; charity, mercy, forbearance, and benevolence, were, all, my business. The dealings of my trade were but a drop of water in the comprehensive ocean of my business!”
And so it is with financial advisors. Most of what you do is care for your clients — the technical aspects of the job being just a small portion of your daily activities. What advisors need is to keep a bit of that Christmas spirit throughout the year.
By improving conditions for Bob Cratchit and looking after Tiny Tim, Scrooge may have lost a bit of revenue but the improved attitude probably brought in lots of new business.