Osceola McCarty, a black washerwoman from Hattiesburg, Mississippi, singleHere at SunBridge we teach that there are three potential levels of service and relationship between financial advisors, estate planners, and philanthropic professionals and their clients and donors. The deficiency of Level One planning is that it reduces client and donor service to a transaction-based activity centered around money.
Such activity, while undeniably part of the “elephant,” is just one part. Money actually is not the most important form of a client’s wealth, but we professionals have trained clients and donors to believe it is, to the point that they don’t think of their wealth as something beyond money and property, and don’t even realize that they can and should be asking us questions of value and meaning that go well beyond this.
I think the traditional, linear form of client and donor service is like the Titanic headed straight for the iceberg. Financial advisors, estate planners, and philanthropic professionals who cling to this ship now find themselves dealing with a generation of consumers who have come of age, have more material wealth than ever before, and bring higher expectations than any preceding generation that the key advisors in their life will be men and women with insight, awareness, and compatible values.
As a result, advisors who still practice at Level One are coming to realize that they have to, as Lewis Carroll put it, “run twice as fast as they can just to stay in the same place” when it comes to marketing. They have to continually bring in new business, but as long as this new business focuses on quick-fixes and transactions, every sale or every donation essentially means they will have to start over tomorrow.
At Level One, it’s difficult even to imagine ways to add value, but without added value, the relationship with the client remains little more than an isolated, hit-and-run encounter. Further, the clients of Level-One financial advisors often put off long-term, whole-life planning, which leaves the advisor in the unenviable position of having to persuade the client to make a commitment to financial services he or she needs. And when the market declines sharply, as it has done several times in the last few years, there’s a lot of blame and finger-pointing, and eventually shuffling of accounts. With no reservoir of good will based on deep relationships, that’s not surprising.
For estate planners, it’s even worse, because the Level-One service they provide usually centers on death and disability — issues that people routinely put off until, for whatever reason, they can’t postpone them any longer. As a result, the Level-One estate planner is constantly working uphill. He or she has no context for answering the question, “What do you talk about with clients after you’ve covered taxes, death, and disability?” And what do you talk about in the first place when there are few tax issues to consider, as is the case for most clients today? Not surprisingly, a substantial number of estate plans are never signed, even by clients who have already paid for them.
In the case of philanthropic professionals, working at Level One is a shallow game of hide and seek, a frustrating chase that has become increasingly difficult in a world when every prospective donor can screen his or her calls, emails, and texts, and who ignores every direct-mail piece the nonprofit sends. There is a constantly growing need for more giving, and sharply increased pressure from the organization to raise more money, but a diminishing pool of contact-able donors to respond to the fund-raisers’ pleas.
Over time, even those few who do listen will tune out or die off. It can be a dreary prospect, pushing the philanthropic professional to move on to yet another nonprofit in search of greener pastures. Unfortunately, there is usually no more grass in the new place than there was in the old.
It is my view that continuing to perpetuate a Level One model of professional practice in today’s world is a recipe for personal and professional disaster. Beyond the consequences for the client or donor imposed by Level One service, there are serious side effects for the advisor — side effects that fairly compel us to ask new questions and, eventually, to move into a reality with options for greater depth. Some of the more serious effects for the advisor are:
1. The products and services that the advisor offers are largely indistinguishable from those offered by competitors (except perhaps on the basis of price), making positioning all but impossible. As a result, these products and services — and by association, the advisor himself — become commoditized. This drives down value and price, making it necessary for the advisor to offset shrinking profit margins by constantly increasing the number of sales just to maintain the same level of income, which creates a marketing reality of diminishing returns;
2. Because there really is no deep and engaging relationship with the client or donor, eventually, the advisor becomes bored with the repetitive, “cookie cutter” quality of the services he or she provides. No client or donor is going to be more enthusiastic about working with you than you are about working with them. This is why so many professionals experience burnout after even a relatively few number of years in practice;
3. The stability of the advisor’s practice remains highly susceptible to shifting economic, legislative, and market conditions. Because the practice is predicated on numbers alone, any changes in laws, regulations, national or world economic conditions, or other factors that affect the numbers, will directly — and often adversely — affect the practice. The unpredictability of such an arrangement fosters a sense of anxiety in the advisor about the future that aggravates the already unsettling marketing reality;
4. A schism develops b etween th Sharing and Saving a Lifetime of Stories e advisor’s work and personal life that greatly reduces his or her ability to be useful to clients and donors. While many things may have great relevance and meaning to the advisor personally, there exists no conduit for incorporating these into the professional practice. The sense of work as something fundamentally separate from life increases, with corresponding increases in tedium, indifference, and suspicions of irrelevance apart from dollar values alone. And ultimately, dollar values alone cannot provide any deep or lasting job satisfaction or feeling of usefulness and purpose.
Even financially successful advisors are starting to question the stress, tenuousness, and dearth of personal fulfillment inherent in perpetuating a practice limited to Level One client service. For example, Mark is an estate planner in a large southwestern city who has a steady stream of clients and a lucrative business, but he’s grown bored with the repetitive nature of his practice and alarmed about the effects of Congressional tampering with the estate tax laws and the threat that they’ll be eliminated altogether.
“Work just isn’t fun anymore,” he confided in me. “I didn’t get into this profession to become a mechanic, but that’s what it feels like a lot of the time.” Staying at Level One is a formula for boredom and burnout, one that leads to the advisor getting stuck on what we in SunBridge call “the marketing merry-go-round,” because the advisor has to keep pushing people into the pipeline as clients and donors move quickly in and out of the professional relationship.
I firmly believe that professional advisors who do not rise to the challenge of meeting the needs of their clients and donors as human beings, who do not shift beyond the old transaction-based approach to client and donor service, will have increasing difficulty succeeding and even surviving professionally in the years just ahead. They will be clinging tightly to a sinking ship.
At SunBridge, we are charting a new course to a truly client- or donor-centered model of practice, where the advisor meets the client or donor at whatever level the client or donor may be, and then invites the client or donor to move — at the client or donor’s pace — to increasingly more profound levels of advisor/client relationship.
Ultimately, at Level Three, the professional advisor serves clients or donors as an architect of sorts, helping them define and design a future of greater abundance, purpose, and significance, and then as a general contractor in turning their blueprint into reality. Those who are able to envision a future for themselves of working with their clients or donors in this way are enjoying greater abundance, purpose, and significance in their own lives, as they produce the same result for those they serve. We invite you to explore this brave new world with us.