Following a recent article on Adviser Lounge, and a bit of social media argy-bargy about the role of consultants, I decided to write a response:
“A consultant is someone who comes in to solve a problem and stays around long enough to become part of it.”
I started with a consulting joke, because it taps into a view that many people hold about consultants. As with any stereotype there is some truth in it, but like all stereotypes it doesn’t tell you the whole story. Just to be clear, in this post, I’m going to lump business consultants, coaches and mentors in the same boat. I’m sure this will cause each group to feel the need to fire off an email to me protesting that coaching is different to consulting or vice versa, but hear me out…I’m talking about anyone who is providing business development advice to financial advisers (and financial planners, life planners, wealth managers or whatever alternative title people choose to define the work they do). Of course, that’s my first point made right there. What someone is called provides you with very little insight into what they actually do and, more importantly, how well they do it. When I first arrived in the UK more than 10 years ago and decided I would start providing business consulting services to advisers, everyone without exception said I was mad. “Advisers won’t pay for consulting” I was told. I knew from my own experience as an adviser why they felt this way. It’s true, a very large proportion of the financial adviser population won’t pay for consulting support, however, I knew from personal experience that it was because the consulting services on offer were pretty ordinary. No one wants to pay a high price for an ordinary service (that’s just sensible behaviour). My job therefore, was to convince people that I actually knew something of value and could work with them to generate results in their business. So I began writing a lot of articles (and still do), to get that message across.
The consulting process
I was listening to an interview recently with Jared Tendler, author of “The Mental Game Of Poker” and coach to many professional poker players and professional golfers. He said that if you’ve tried hard to solve a problem utilising several different approaches but have not yet resolved the issue, it’s because it is complex. With complex problems, silver-bullet-single-approach solutions just don’t work. This is where good quality consulting support can really make a difference. The issues that advisory businesses are trying to resolve can’t be done with silver bullet solutions; the issues are messy and intertwined. Good quality consulting is not one-size-fits-all or consulting-by-numbers. However, there are good business principles that work across all businesses and all industries and sometimes these just can’t be avoided. Knowing your target market and their key concerns, or having the right people in the right roles within your business are good examples. So when you read articles about these common topics, it can come across as if a bunch of standard, off-the-shelf solutions is all a particular consultant has in their armoury. In my case that’s certainly not true. I operate on the philosophy that every job I choose to take has to be meaningful; in that the adviser/owner(s) of the business have to want something more for themselves and their business. If they don’t want something better there is no role for me to play. My job is not to simply create a profitable functioning business, it is to allow the business owners to fulfil their potential and to live the life they have always thought was possible after they build their great enterprise. That’s my mission.
I believe my job is to teach people to fish. When I leave, I want them to have the skills to continue to move forward. Good consultants pass on their knowledge and experience so their clients will continue to flourish long after they are gone. I love the work I do. If I couldn’t do this for money I’d do it for free in my spare time. Even if I won the lottery and didn’t need the money, I’d still work as I do today, helping good advisers build better businesses to fulfil their potential. Incidentally, I’d still charge for it, as anything free is never valued. The fee could be donated to charity, but the client would still have to pay, otherwise it wouldn’t work. It’s got to hurt a bit. In my view, financial advice ‘done well’ provides a life changing service to society. Every single family helped by an adviser providing sound advice and smart strategy can live fully and pass on their approach to others within their sphere of influence. This ripple effect provides significant societal benefits in the long run. In 50 years time I expect financial advisers to be the dominant profession on the planet. There may still be some jokes on Google about the bad ones, of course, but overall I expect our collective reputation to be better than that of any other profession because of the societal benefit we provide.
The criticismIn a recent article Chris Budd said:
“It’s an old marketing approach of course. Create the impression that others are better than you, then offer the product or service that can enable you to achieve such heights yourself. Since RDR there seem to have been a plethora of consultants and firms that have sprung up to tell advisory practice owners how to run their firms. ‘Just do it like I tell you’, they imply, ‘and you too can have a business which is as successful as all our other clients.’ There seem to be so many of them now, all with secret knowledge that will save us poor IFAs from ruin and transform our practices.”
I take Chris’ point. Not everyone marketing this way will be able to deliver on what they claim, so a certain amount of healthy scepticism is warranted when buying consulting services (or anything else for that matter). The counterpoint that I do feel able to make, is that the knowledge possessed by a decent consultant is not usually of the ‘secret’ variety. More often it’s of the tried and tested variety and yet so many small advisory firms are not making use of it. In these cases, simply accessing and using it can unlock the potential of your advisory business. The fact is, most advisory firms don’t make any profit after they’re paid the equivalent of a market salary. In fact many adviser/owner(s) are paid less than market rate by their business. I make no apology for saying that this is lunacy. I understand it’s not about the money for most of us. I understand there are deeper drivers within financial advisers; their desire to help people, the responsibility they feel for their clients (even the small or clearly unprofitable ones). However, it is possible to run a great business that is also fun, fulfilling and profitable without letting go of your deeply held values. ‘Good’ for the client doesn’t have to mean ‘bad’ for the adviser/owner(s) and their family. Yet, so often, it is the adviser/owner(s) and their families that pay the price in delivering ‘good’ to the firm’s clients. There are some excellent people providing valuable assistance to financial advisers. Here are a few I recommend (in alphabetical, not preferential order):
- Matt Anderson
- Paul Armson
- Phil Billingham
- Phil Calvert
- Mark Dennison
- Tim Hale
- Michelle Hoskin
- David Shelton
- Darren Shirlaw
- Jim Stackpool (Australia)
- Dan Sullivan
- Mark Tibergien (US)
- Tracey Underwood
I’m sure there are many I haven’t had the chance to get to know who are also great, so please don’t take this as a snub if you’re not mentioned here! There are others, of course, who I believe talk a good game, but wouldn’t be on my list of people to work with.
The untapped potential
I examine every small advisory firm and see the potential within it. Good financial advisers do the same with the clients arriving in their offices. Often these prospective clients are poorly structured and have limited knowledge of how to make things right. I see the same in my work and I won’t apologise for my desire to do something about it. I stand behind what I do and I will always work to the best of my ability to deliver tangible results (both hard and soft) for my clients. Financial advisers and consultants are on the same team. No one has all the answers and no one has a mortgage on good ideas.