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What Comes First—Changing the Tech or the Staff?

Firms are struggling with technology adoption because they believe their executives or staff can’t change or learn new methods of operating. So they stop implementing the tech (aka the change) and instead start interviewing potential hires to replace their current staff who appear unwilling to change and learn. This stoppage and hiring effort creates a dark cloud over the mood of the staff. It sends a message that the firm isn’t prepared to improve nor invest in change management. Rock star-quality staff take this stoppage as a sign and ultimately stop recommending improvements and cease their championing of change. If the stoppages happen often, your best staff might even start interviewing at other firms or start their own firm.

How do I know if my staff are able to learn new systems?
The easiest way to test the team’s ability to learn is to sell the change before implementing it. As the firm owner, you must believe in the change, know the benefits, and persistently encourage productive feedback. Remember that the administrative person might care about reducing data entry work, while the adviser will want this change to help them onboard a new client more efficiently. Staff that can’t adopt the change will stand out immediately. If they are your key team members, have your executive team talk with them and explore why they are resistant to the changes. Then, and only then, will you know if it is time to search through the resumes and start to recalibrate the staff with a new hire.

Do I lay off a loyal staff person when they can’t learn?
We all know it is very expensive (money, energy, time) to lay off and hire someone new. Any new hire requires you to use energy and time to train them on your firm’s method of operating, philosophy regarding client service and expectations. It is best to NOT lay off those who seemingly can’t embrace change and instead invest in training and change management first. Training can be in the form of scheduled weekly webinars, paying an outside expert or software provider to provide customized training, or having a staff person train his/her peer. Change management comes from the top. If you are not sure you are managing change properly, you can hire a coach to learn how to do this effectively now and in the future.

While you invest in training and management, you should also be scouring the earth for potential hires. A great employee, successor, or partner hire won’t fall into your lap the minute you decide you want to re-calibrate your team. It is never too soon to start networking and doing informational interviews and building your pipeline of candidates. If the training and change management does not produce the results you want, you know you can call upon a pool of qualified candidates.

Change isn’t easy—if it were, everyone would be doing it! Remember that any meaningful technology change—even implementing a new software program—takes more than 66 business days to adopt. Give your staff time to embrace the new tech and provide continuous training, positive reinforcement and examples of the long-term benefits. Most importantly, be sure to give yourself time to lead the troops with a positive attitude and realistic change management goals. Progress may be slow but as long as you’re seeing change transpire, rest well knowing your firm is on the right track.

Jennifer Goldman

 

Jennifer Goldman
Founder
My Virtual COO
Boston, MA

Editor’s Note: FPA members receive a $500 member discount on a My Virtual COO consulting engagement. You can find more information here


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Step Up Cybersecurity

As planners incorporate more technology into their offerings to clients, it’s imperative they stay on top of their cybersecurity measures.

“Cybersecurity is a major issue for financial planners in today’s highly technical, digital world,” writes Ben Lewis, FPA’s public relations team leader on an FPA Connect post calling for participants for a cybersecurity assessment that has since ended.

Anthony Stitch explains in the forthcoming August issue of the Journal of Financial Planning that planners who don’t provide the technology clients want these days may lose those clients to firms they like less but that offer the technology they prefer. This, he writes, is called digital attrition. Members, you’ll get to read the full article when it comes out. And if you’re not yet a member, maybe now is the time. Learn more here.

“As you incorporate more technology into the running of your firm, it’s important that you stay educated on best practices for cybersecurity,” Blane Warren, an industry leader in financial services marketing, compliance, and technology, writes on XY Planning Network’s website.

But planners this move toward providing more technology options means planners need to step up their cybersecurity game in order to keep their clients and themselves safe. Something they’re not currently doing very well, according to a report from External IT titled “Financial Services Firms Face Further Scrutiny of Their Cybersecurity Practices: Is Your Frim Ready?”

InvestmentNews reports that that report found three key areas were lacking in terms of financial cybersecurity: security policy, firms failing to audit their IT security; accountability when moving data, moving data to personal and home devices without tracking measures; and disaster recovery, not having emergency business continuity plans.

This isn’t to say that planners don’t want to address cybersecurity issues, rather they don’t know where to go to get their information, Brian Edelman, chief executive of Financial Computer Services told InvestmentNews.

Edelman recommends using a cybersecurity firm that understands financial services.

In a recent article, ThinkAdvisor recommended planners check out the following resources: National Institute of Standards and Technology (nist.gov) and the Financial Services Information Sharing and Analysis Center (fsisac.com).

AnaHeadshot

 

Ana Trujillo
Associate Editor
Journal of Financial Planning
Denver, Colo.


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Financial Advisers Are on Board with Social Media, but Questions Still Linger

The findings of the Putnam Investments 2015 Social Advisor Study, which surveyed more than 800 U.S. financial advisers, point to the fact that social media continues to become an increasingly essential tool for advisers to communicate with their clients and build their book of business. Here are some of the study results:

  • 81 percent of advisers currently use social media for business, up from 75 percent in 2014
  • 40 percent of advisers (vs. 25 percent in 2014) use four or more social networks for business
  • 69 percent of advisers report social media is a significant component of their overall marketing effort—up from 56 percent in 2014
  • 79 percent of advisers report acquiring new clients through social media (up from 66 percent in 2014) with average annual asset gain from such clients standing at $4.6 million

These numbers appear to provide tangible proof that social media has grown to be the most direct path for advisers to reach out and influence their key audiences. However, despite this success, some degree of skepticism among advisers continues to linger. Below, I’ve listed the three most recurring questions financial advisers pose to our firm about social media.

Does Social Media Really Matter?
When confronted with this question, we consistently reply that the answer is debatable. What works for a financial planning practice may not work for a wealth management firm. And, in some cases, social media may not be a choice at all. However, before rejecting it, there are some key factors to be considered:

  • Unlike meeting a prospect face-to-face, or attending a live marketing event, social media interaction does not require travel and the costs associated with it
  • It allows advisers to exhibit knowledge and expertise to an audience beyond her or his established database of contacts and leads
  • It empowers advisers to create a sizable virtual network to develop new business
  • It helps foster conversations about an adviser’s brand
  • It establishes a bridge between an adviser’s website and her or his target audience—a good social media page will drive traffic to the adviser website
  • It enables advisers to position themselves as an expert sources at a negligible cost

How and Where Do I Begin?
Traditionally, the answer to this question has to do with what the adviser is seeking to achieve. Before engaging in social media activities, we recommend that our clients familiarize themselves with what other advisers, journalists and bloggers are doing—for example, the type of topics they cover, the frequency of their posts, the volume and quality of response they receive. This preliminary exercise will enable them to gauge whether or not social media is an effort they “really” want to pursue.

The second step is getting acquainted with a couple of platforms like LinkedIn and Twitter. After joining them and establishing suitable profiles, the next action is to create engaging content—topics of compelling interest to the adviser’s core audiences—that includes tips, guidelines and actionable ideas. Then post such content on the adviser’s website and concurrently proceed to “push” it via established social media accounts. Ultimately, your social media engagement should seek to achieve two key strategic goals: 1) engage your audience prompting it to share your expertise and guidance; and 2) direct traffic to your website.

How Can I Handle Compliance?
Traditionally, compliance is advisers’ major deterrent to social media. Often, this is due mainly to their lack of understanding on how to meet social media compliance requirements. Prior to launching into social media interaction, it is crucial that an adviser attains a good understanding of FINRA’s rules governing communication and specifically how they regulate social media activities. FINRA’s guidance, articles, podcasts and videos on this topic abound and are easily found on the Internet. To shield themselves and their firms from legal consequence arising from bad social media interaction, advisers must establish a social media policy—that includes archiving procedures and guidelines—and if needed, seek appropriate legal counsel.

With social media, like with any other type of marketing communication effort, advisers must pay utmost attention that any post, comment, tweet is FINRA compliant. For example, a post or tweet in which an adviser may support a specific stock or bond could represents a “recommendation.” As such, it could be consequently treated as a breach of FINRA’s suitability rule and bear legal consequences for both the adviser and her firm.

Claudio PannunzioClaudio O. Pannunzio
President and Founder
i-Impact Group
Greenwich, Conn.

 

Editor’s Note: Other FPA social media-related content that may be of interest to you include:


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Social Media Strategies of High-Growth Firms

Your clients don’t want to have to rely on you for everything—they want information to make educated choices. And the way to engage them and other prospective clients is through content development and social media, found a recent study.

The study, titled “Communication Evolution: Financial Professionals and the Future of Thought Leadership and Social Media,” was conducted by the Financial Planning Association and LinkedIn was conducted by If Not Now Research, found that was the case.

The study found that clients crave more knowledge and many high-growth advisory firms are satisfying that craving by curating content and sending it out to current and would-be clients via social media, which is termed in the report as “thought leadership.” And it’s paying off.

“The study draws an important connection between the drivers of client engagement and communications strategies that will help advisers stand out from the crowd,” said Julie Littlechild, President of If Not Now Research.

“This report aims to help financial advisers of all business models understand how their peers are engaging in social media and thought leadership, the connection between business growth and these communication tactics ,” writes Lauren Schadle, CEO and executive director of the Financial Planning Association.

Some of the study’s biggest takeaways include the following:

Clients are engaged online. All age groups surveyed engage in online searches, but different age groups do so differently. While younger clients (ages 18-44) are more likely to search prior to meeting an adviser, older clients (ages 55-64 and those over 65), are more likely to look up an adviser to validate their impression of them.

Clients are engaged in social media and they expect you to be too. The age range of those most engaged in social media is 18-44 with 62 percent of respondents active on LinkedIn, 86 percent active on Facebook, and 55 percent active on Twitter. LinkedIn is the primary site advisers are using—76 percent of those surveyed—which is a good thing because the clients surveyed said they expect their advisers to at least be on LinkedIn.

Clients want education. They sought you out because they want professional help, but they also want to be educated on the issues so they can make their own informed decisions.

Firms that curate and push out educational content grow. Firms that wrote blogs, newsletters and other informational content and pushed it out via social networking sites and email saw growth over those who didn’t. The study found that 67 percent of high-growth firms said they added new clients as a direct result of using multiple professional and social sites, including Facebook, Twitter, and LinkedIn.

“Today we have a choice: to watch how the change plays out or to take action and be part of the change,” the report notes. “The data suggests that the leaders are the high-growth firms that are reaping the rewards of driving the change.”

You can find the full study here.


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Email Prospecting: 4 Tips to Make the Most of 2.7 Seconds

email-on-ipadOne of the biggest challenges for advisers when prospecting is to secure that initial meeting. Often the preliminary outreach to a prospect may take place via email and in that case getting a positive response—or a response at all—can be an arduous mission to accomplish.

According to The Radicati Group, a technology research firm, 1.9 billion non-spam emails are sent every day. To stand a chance to be acknowledged, email messages must be smartly crafted to grab recipients’ attention and motivate them to respond. Other consumer studies also revealed that it takes only 2.7 seconds for an average person to decide if they want to read, delete or reply to an email. This is in part courtesy of our increased use of handheld devices, which currently represent a preponderant portion of all email interactions.

A couple of industry statistics will help you gauge the impressive growth and usage of email on mobile devices:

  • 53 percent of total email opens occurred on a mobile phone or tablet in Q3 2014, from 48 percent in Q2 2014.
    (Experian, “Quarterly email benchmark report,” Q3 2014)
  • Mobile email opens up 180 percent in three years, from 15 percent, Q1 2011 to 42 percent in Q1 2014.
    (Campaign Monitor, “Email interaction across mobile and desktop, Q1 2014)

What are some of the key factors that prompt prospects to delete emails? Key culprits traditionally include convoluted language, use of industry jargon and failure to make a strong case for value—are you worth your prospect’s time? Will you be for her or him a valuable source?

Ultimately, it is not the service or product that you are pitching that will prompt your prospects to take action. Rather, your capacity to convince them that you understand their challenges and that you can help them achieve their goals will be the deciding factor. This is what will persuade them that getting additional information or requesting to meet with you will be a good investment of their time.

Here are some of the crucial factors you must bear in mind when crafting an email:

  1. Grabbing Subject Line: Use concise language. Do not exceed 50 characters. Be clear, consistent, use action words to inspire and, when possible, consider adding the recipient’s first name
    Length: The statistics above make a compelling case for prospects reading emails on mobile devices. Consequently, keep your emails short—preferably under 100 words
  2. Personalize: According to HubSpot Science of Email research, personalizing an email increase click through rates by 14 percent. So, conduct some specific research that can help address the recipient’s challenges and openly quote it in the text.
  3. Credibility: Do not shy away from name-dropping. If the prospect was referred to you by a third party, mentioning that individual’s name may significantly increase the odds of a response
    Value: The first couple of sentences should unequivocally state what you are offering and why it is valuable. To accomplish this goal, clearly state your value proposition. Also, go the extra mile by sharing any educational material you may have on the topic and clearly enunciate to the reader the benefits she will derive from reading such material.
  4. Closing: In closing your email, remember that your goal is to establish an ongoing conversation. Include a call-to-action and word it in a personal and engaging manner, be it a meeting request or a telephone call.

Claudio PannunzioClaudio O. Pannunzio
President and Founder
i-Impact Group
Greenwich, Conn.


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Diamonds and Your Social Presence are Forever

The internet was once regarded as an “other” space that existed beyond the reaches of “the real world.” What happened on the Internet wasn’t to be taken seriously–it wasn’t real. This rather strange concept of the Internet is now changing, due in large part to the rise of social media.

While some continue to miss the Tweet, there is a growing consensus that what is said or done online has a direct and measurable impact on the physical, tangible world.

And all of this mass communicating we’re doing, every think-piece, Tweet, status update, and picture we post, is being cataloged–it’s been said that history is now recorded faster than it’s actually taking place. The Internet is one large encyclopedia of the human experience, and unlike the hardcover collection on our shelves in the basement, it cannot be destroyed by flood nor fire.

Diamonds and your social presence are forever.

In other words, navigating an online presence is hard, and two social media sites in particular get people into the most trouble.

Facebook
On Facebook, keeping your personal and professional self separated is a must. For many of us, even before we considered our future careers, Facebook was around to make sure we wouldn’t have one. Depending on how long you’ve been active on the site, Facebook tends to be a place of old college buddies, new babies of those old college buddies, and beer. Probably of you consuming it. With your old college buddies.

Instead of mixing business and pleasure on your profile, create a business page for your firm. This way you can guarantee that what you post is professional and in keeping with your business brand. Most of your clients aren’t interested in seeing you in your college glory days. In that same vein, restrict access to your profile to only include friends–they’re less likely to tattle on you if you make a blunder.

Twitter
Twitter’s an odd bird. If you’re a professional, it likes a mix of business speak; unrelated yet interesting articles from around the web; and the odd pithy personal update. Unless you have something akin to an obsession with declaring the veracity of unicorns, it’s not imperative to maintain a personal Twitter account as well as a professional one. If you do have said passion, create a cleverly disguised pseudonym and Tweet to your heart’s content–just remember which account you’re logged into.

While the readership of Twitter is generally accepting of a variety of posts, the deceptively open and on-the-fly nature of it makes it prime real estate for gaffs. You may be Tweeting from the comfort of your own home, but your Tweet is out roaming the world. And once it’s out, it’s almost impossible to stuff that bird back in the cage.

The big takeaway?
While it’s true there’s a potential landmine waiting to explode with every social media post, it’s also true that how we conduct ourselves online shouldn’t be any different than how we conduct ourselves in person. Unless what you have to say qualifies for the Whistleblower Protection Act, if you wouldn’t say it out loud, don’t say it online.

Absolutely speak to your audience, but also give thought to the possible reaction outside of it. And before you wade into whichever moral issue is up for debate, do a quick cost-benefit analysis to determine whether your opinion is worth the potential loss.

Oh, and don’t forget to have fun!

Kellie GibsonKellie Gibson
Marketing Writer
Advisor Websites


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Tapping Technology for Review Meetings

Many advisers have replaced at least some in-person review meetings with technology-supported meetings (e.g. via Skype) This practice is becoming more popular for several reasons:

  • Clients want to save time or may prefer the comfort of their own home or office instead of driving to the adviser’s office.
  • Advisers may prefer the efficiency of review meetings aided by technology.
  • People in general are more technologically savvy and comfortable with the notion of technology-supported meetings.

On the other hand, it is unlikely that one would use a technology-supported meeting as a vehicle for developing or strengthening a client relationship.

Pros and Cons
Advisers who conduct technology-based review meetings report that these meetings set up win/win scenarios—they’re more efficient for the adviser and more convenient for the clients. Typically, there is less chitchat and a tendency to get down to business sooner, so review meetings end in half the time that in-person reviews take. Still, there are some differences and possible downsides to be aware of:

  • Less chitchat may be efficient, but it can rob the adviser of tidbits of information that enhance the client relationship or provide cues about a client’s understanding of, or comfort with, his or her financial status.
  • Most likely, the adviser’s staff isn’t involved in technology-supported meetings, resulting in less input for the adviser. In addition, some staff may miss having the opportunity to interact with clients, an experience that gives purpose to mundane tasks such as filling out paperwork.
  • Both clients and advisers need to assume the added responsibility of ensuring that personal information passes only via secure lines.
  • Although advisers may have trained both spouses to participate in in-person client meetings, it may be easier to tap only one spouse or partner when the move is made to technology-aided meetings, which could open the door to some miscommunication.

Change Happens
This isn’t the first major transition in client meetings. Many tenured advisers remember transitioning from appointments in their clients’ homes to meetings in their own offices. That shift happened approximately a decade ago, and no harm was done. Nevertheless, advisers may want to keep these tips in mind as this change unrolls.

  • Be sure that both spouses are involved in at least some technology-aided review meetings.
  • Prepare clients for the importance of cyber security. 
  • Practice video technology before using it. For example, depending on camera placement, looking directly into a client’s eyes on the screen can appear as if the adviser is looking elsewhere. Looking into the camera, however, though not intuitive, comes across as looking directly at the client.
  • Consider adding staff to some technology-aided meetings, depending on your staff’s relationship with a client.
  • Offer in-person meetings as an option. Even if clients don’t want to take advantage of this offer, giving them the opportunity for in-person interaction is advised.

Financial planners are relationship people. Efficiency is wonderful. But efficiency that takes precedence over relationships is dangerous.

Joni Youngwirth_2014 for webJoni Youngwirth
Managing Principal of Practice Management
Commonwealth Financial Network
Waltham, Mass.

 

Editor’s note: Read an article in the May 2015 issue of the Journal of Financial Planning that focuses on how to prevent identity theft here. Also, listen to an FPA webinar titled “Leveraging Cloud Technology to Overcome Cybersecurity & Compliance Risk” here. Another helpful webinar, titled “Mobile Security: Defending the Devices that Power Client Productivity” can be found here.

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