by Kevin Rex
Over the past two years, huge numbers of Americans have seen their savings and investments ravaged by volatile markets and a suffering economy.
Desperate to keep their finances from disappearing completely, people are reaching out for professional guidance, more than ever ... soliciting CPAs, financial consultants, attorneys and other experts to help manage, maintain and grow their wealth.
These advisors typically work independently, focusing exclusively on their area of expertise, and with only a limited sense of each client’s complete financial picture. For clients with complex financial planning needs, however, this narrow approach is detrimental to their best interests. In fact, it hinders your ability to be most effective.
In today’s highly competitive marketplace, establishing and maintaining a successful long-term client relationship requires you to anticipate and serve the broadest possible spectrum of your clients’ advising needs.
The solution? Strategic business alliances.
Strength in numbers
The idea of collaboration might not agree immediately with your business instincts. But the most successful, comprehensive, long-term plans for a client’s financial growth and security are founded on an understanding of his or her complete financial profile. To be successful in this regard, you need to consider strategic business alliances - a formal network of top-quality advisors who coordinate their efforts on behalf of shared clients through a continuously updated exchange of information.
As a CPA, you will find that working in concert with your clients’ other financial advisors creates a cumulative "think tank" that allows you and your strategic business partners to pool knowledge and synchronize efforts to your and your clients’ advantage.
It allows you to determine which over-arching strategies offer the ideal balance of asset growth, management and protection for each client. When, for example, might a potential tax advantage be outweighed by an investment opportunity, and when might the opposite be the case?
Smoothly functioning strategic business alliances keep all parties -- advisors and clients, alike -- in a real-time and integrated communications loop. This collaborative effort will generate more accurate data and a more comprehensive understanding of your client’s financial profile, which, in turn, allows you to offer each client better and more informed guidance.
As a result, you gain increased client satisfaction and retention, plus referrals and a collegial network of professionals to consult when questions arise in your own work that might benefit from their expertise.
Building a network
If a client has other advisors already deployed on their behalf, you should consider engaging them. If not, you’ll need to forge relationships on your own. It should be understood, however, that an alliance is only as strong as its members.
So, do your homework. Invest the time to research potential strategic partners, and form alliances only with those financial advisors who demonstrate a truly skilled and professional attitude - advisors who, like you, are clearly dedicated to taking the best possible care of their clients. Look for your partners among those whom the advisors themselves consult for advice. Ask yourself if you would be willing to refer your most valued client to this advisor.
Four guiding principles
Once you have begun establishing strategic business alliances, it is important to keep these four key principles in mind:
1. Don’t become a competitor with your client’s other advisors. To be successful, strategic business alliances require a free exchange of information and, thus, demand a high degree of mutual trust and respect. You should think of your alliance partners more as colleagues than competitors. Therefore, never attempt to solicit business away from your client’s other advisors.
2. Educate your clients and their advisors, and keep everyone in the loop. Be generous with your knowledge and expertise. Help your clients and their other advisors to understand the issues, tax laws, potential benefits and possible drawbacks involved in a particular plan. Solicit input from your fellow advisors, as well. Affirm the value of your services by regularly updating clients and alliance partners on new laws or changes in existing laws that are relevant to their specific needs or interests.
And of course, always keep all parties abreast of significant changes or updates in your client’s profile.
3. Become an advisor to your client’s other advisors by helping them to understand your work. The more you understand the full range of factors involved in financial planning and management, the better an advisor you can be to all your clients. Seize any opportunity, therefore, to expand upon your knowledge of your fellow advisors’ work and to educate them about your own. Encourage your alliance partners to turn to you for advice when questions arise that fall in your area of expertise.
You may find, as I often have, that an alliance partner favorably impressed with your insights may soon become a client eager to employ your services.
4. When appropriate, generate referrals for your clients’ other advisors. Inevitably, you will find in your work occasions when a client seeks your advice on matters outside your own realm of expertise.
With strong strategic business alliances in place, you have a readily available network of professionals whose knowledge and integrity you can attest to with confidence. In offering these referrals, you can assure your clients of the unique advantages afforded them when they consult with an integrated advisor network.
One final point: Once they are established, these alliances should be treated as dynamic, ongoing, strategic relationships. When carefully formed with only the best advisors, they offer virtually limitless potential for your clients and for your practice.
Satisfied clients become referral sources, alliance partners become clients and your own knowledge base - and, therefore, your ability to ever more successfully advise your clients - continually expands, enhancing your reputation and drawing the most discerning clients to your practice.
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