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Self-Leadership – Marketing by Example

Self-Leadership – Marketing by Example

00:00 01 January in In the News

by John Melchinger and featured in Broker World Magazine
January, 2007:

As the new year dawns, I’ve been thinking about a situation that has become worse for many advisors in the past few years and, unfortunately, shows no sign of abating. Advisors are faced with so many urgent situations that the urgent messes with the important. As advisors wade through the quagmires of minutia and immediacy, more important issues are placed on the “back burner.”

The logic observable in this reality is compelling. It reminds me of the observation coined when efficiency experts were running procedures and staff into death webs of efficiency ennui: “Efficiency is doing the right things the right way. Effectiveness is doing the right things the right way.” If you set clear priorities and concentrate on effectiveness, efficiency simply follows along.

The key to self-leadership unlocks the door to successful business ownership: Set and keep clear priorities, working down from the most important to the least important. Look around you at the most successful owners you know. They all establish clear priorities and discipline themselves to work from the top (most important) of the list down. There is reason in that behavior – it pays off in success.

Plan from the Beginning

No matter where you start, plan as if you were at the beginning. Jackie Robinson observes that “Life is not important except for the impact it has on other lives.” This is a reminder that everything we do, starting with our choice of business, works only when we do it for someone else. Someone else is the customer. If the customer is not satisfied, business becomes lonely for those who remain in it and the business dies.

Business is a balancing act. We are in business to make our lives better, yet we often sacrifice the other parts of our lives to concentrate on making our business successful. It’s a bad rut. When we question a business owner as part of our own business process, we ask questions we would avoid asking ourselves:

  • Are you in business to make your life better, or in life to make your business better? If, as an outside observer, I were to examine the last 12 months of your life would I draw the same conclusion?
  • We both know what you’ve done to be successful, but what are you doing to be significant?

Tough questions – but good ones – for anyone.

How ever do we manage to achieve and maintain our own balance? We advise, but are we better at giving our advice than taking it?

Important Resources

Safety in Numbers. Lone Rangers in financial services are fast dwindling. The true independents are too often retiring or melding into larger groups. The income is better, the expenses less, and the camaraderie improved. At least these are the major promises. Sometimes the magic works and sometimes it doesn’t.

The better the intelligence you gather before a change, the better the change is likely to turn out. “Larger” may come with restrictions you cannot tolerate, and it may come at the price of having to move again and explain it to your clients. What seems a good move the first time may seem like bad judgment if it happens again.

Help with change.

If you are independent and seek a broker/dealer whose values better match you and your needs, will you do the intelligence gathering about possible opportunities yourself, or seek guidance from a pro? If you do this without help, you will miss many opportunities.

I work with independent advisors who often seek matches with independent broker/dealers. I have come to know Jon Henschen of Henschen & Associates ( who is a straightforward professional matching advisors with appropriate broker/dealers. This is the kind of help you want if you are in the waning days of a relationship going sour with your present broker/dealer. It is one example of seeking qualified help.

Help with Sales.

If you are alone in your operations, with no one to bounce ideas off when you are working a case, a point-of-sale professional partner can be a boon. They can help you find a solution, a product, an alternative, the right words and a fresh way to present and explain something. They distribute products from various companies, help you build sales presentations, meet with you and your clients whenever needed and can guide you through unfamiliar territory you have not mastered yourself. I know this well. I have coached brokerage managers to success over the years, and my wife, Jayne Alford, CFP, CLU, ChFC, is a multiple-carrier brokerage manager with a national distribution network and works point-of-sale with most of her clients.

You may be of the mind to have several brokerage managers vying for your business. You may like the attention, but it may turn to inattention if you cannot feed them enough business. As most advisors think of “brokerage managers” as representing one company, you should be aware that times have changed.

Companies (carriers or manufacturers of product) have allowed independent middlemen – “wholesalers” to join their distribution system. These are independent agencies called brokerage general agencies, marketing organizations and producer groups, all of which promise multiple carriers some volume of business in return for a better compensation arrangement.

In these electronic days, headquarters need not be near to you as long as they have a local rep when you need face-to-face help. As “high” tech tends to overcome “high touch,” don’t forget to consider this and keep “high touch” in you business mix with a good relationship.

Out Front Back Offices.

Almost everything still comes down to relationships. You may like a distribution system but not like or trust the local rep. You decide not to allow this person in front of your clients. You may decide to seek an alternative if the local rep does not meet your standards. A large firm can change staff and solve a problem, but you must outsource much of what you do. Thus, changes like this are more alarming, especially if the poor distribution system has access to product and commission schedules more favorable to you than others you may tap.

Think Outside the Box.

Is there someone you can partner with on certain types of cases? If carriers can look for alternative distribution systems, why can’t you? Maybe you work with a marketing network, but a producer group will better meet your needs (or vice versa). Perhaps you’ve been juggling several traditional brokerage relationships and now it’s time to centralize your access to several carriers by developing a relationship with an expert who has access to multiple carriers, local underwriting privileges, advanced sales knowledge, and different ideas and experiences from yours. This means that the relationship you develop with this expert is at least as important as any you might have with a carrier. Really.


Marketing and selling financial services is not a collegial as it once was. Companies and advisors play their cards close to the vest now, rather than sharing ideas under development. It seems everyone has learned that in marketing it is good to be first and good to be best – but it is definitely best to be first.

In marketing financial services at the carrier level, you can see the current trends yourself. Advertising is less effective than it once was because the abundance of hype numbs the consumer. Still, many ads devote their precious minutes to boosting their advisors. You’ve seen those ads. And the ones where celebrities tell you what you will be doing in retirement, then lead you to find a local advisor from that company. We all know that a San Diego consumer is not going to work with an advisor in Chicago. “High tough” relationships are not important, they are critical.

It defies logic that in this era of “bigger is better” thinking, individual relationships are critical, but that is how it is, especially with advisors in business for themselves. You cannot afford to staff up with all the expert help you need only when you need it, unless you find and develop professional relationships with someone like a “manufacturer’s rep” for multiple carriers whose best interest is to fit seamlessly into your process and firm as if they were your partner.

I believe that to remain truly independent, you must build this type of independence with experts or join a producer group and get what you need there. Producer groups, brokerage general agencies and marketing organizations give you advantages in compensation and should give you real advantage with experts you want to put in front of your clients. There is much more that goes into your success than money.

Your clients may think you are brilliant – and you may be – but no one believes that you do everything or know everything yourself. Financial clients expect you to have resources that respond to your directions and leadership, just as they do with you as their trusted advisor. Your clients may think of you as their financial general contractors, you assemble ad hoc teams of experts for each case whenever expertise is needed.  This is a main part of your clients’ trust in you and your leadership.

Back in the day, when everything was less complicated by a singularity of purpose (what need and type of insurance, rather than what type of insurance, investments, annuity, and online portfolio maintenance software should I be using?) these principles and relationships were already important. They remain as important today.

The dwindling number of financial advisors tells me not only that training for an opportunity in a financial services career is a problem still unsolved, but also that advisors who are poor business people leave their independence behind by quitting or allowing themselves to be absorbed by larger carriers and living under very strict supervision and control.

As an independent, your clients are you clients. Not so with the larger firms. The shelter you receive from membership in them comes at the price of signing non-compete agreements or other restrictions. I have moved several advisors from membership in large firms to independence, but it’s almost impossible to do today and keep your clients. In all attempts at escaping, exquisite care must be taken and you must not get cold feet in the process. Conversely, going the other way – into captivity – is easy.

Another New Year

So there you have my opening volley for 2007. If you enjoy your independence – or as many of us realize we are really unemployable by other than our own selves, so we are self-employed – you must nurture your independence or risk losing it by not being successful at it.

None of us wants to end up like Willie Loman in “The Death of a Salesman.” His failure to grow at the speed of change forced him into failure and depression that ended in felo-de-se.

Independence does not mean you are alone. We must bond with clients to the extent that they trust us and the advice we give them, and we must learn to trust others and the advice and help they offer us.

If you have no idea how your back office is arranged and you go about processing cases only on the basis of what you yourself know, cut if out. You are missing the boat. If you have a loose idea of what your back office arrangements are, tighten them up and demand what you will of those you honor with your trust.

Determine to preserve your independence by running your own business and beware of corporate types who would tell you how. Running a small business is not like running a little big business.