Welcome back for the third episode of the Financial Advisor Success podcast!
This week, we’re changing it up a little bit – rather than speaking with a financial advisor, my guest is Julie Littlechild, a speaker, writer, and researcher focused on understanding and improving financial advisors’ engagement with their teams and their clients. She is now the founder of Absolute Engagement, a firm that is conducting ongoing research into personal, client, and team engagement in advisory firms, and has also done extensive research on generating client referrals.
In this episode, Julie shares what she’s learned from her real-world research about what works – and what doesn’t – for financial advisors, including why asking clients for referrals is generally a terrible way to actually get referrals, and how to reposition yourself to become more referable. Julie also shares her research on how advisors can get more energized and re-engaged in their practices, and how her own experience of building and then selling her coaching business gave her perspective on the challenge of staying engaged in the business you’ve built.
So whether you’re a financial advisor trying to generate more and better client referrals, or feel like you’ve hit a wall and need to get re-energized in your own business, I hope you enjoy this latest episode of the Financial Advisor Success podcast!
What You’ll Learn In This Podcast Episode
- How Julie got into practice management for financial advisors before it was widely acknowledged as a needed service [3:41]
- The business model at her coaching business, Advisor Impact, and how it informed her later entrepreneurial efforts [8:23]
- How conducting client satisfaction surveys really can help inform advisory firm owners to more effectively grow the business [11:02]
- How Julie started studying ways in which to help clients better communicate their advisors’ value to family and friends, and how advisors can increase the quality of those referrals [21:22]
- Why traditional referral strategies, like proactively asking for referrals, or explaining you get “paid” with referrals, might actually be working against you [29:20]
- Why she decided to sell and leave her business at Advisor Impact, and the sometimes-rocky transition to a new venture [47:40]
- Julie’s thoughts on whether and when you should sell your advising business entirely or simply fold into another firm [52:38]
- The goals of Julie’s business today at Absolute Engagement and how it’s starting new and necessary conversations with advisors [1:02:16]
- The three principles of the “absolutely engaged” – and absolutely successful – that Julie’s identified and built her business around [1:06:45]
Resources Featured In This Episode:
- Julie Littlechild – Absolute Engagement | Becoming Referable Podcast
- Absolute Engagement by Julie Littlechild
- NetPromoter Score
- Malcolm Gladwell – Are You A Connector?
- Caroline Adams Miller
- Stephen Wershing’s “Stop Asking For Referrals” book
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Full Transcript: How to Become a More Referable Advisor with Julie Littlechild
Michael: Welcome to the Financial Advisor Success Podcast. So far on the podcast we’ve talked to financial advisors who’ve shared their path to success and the challenges they faced. But today however, we’re going to do something a little bit different. I talked to Julie Littlechild, the founder of Advisor Impact, a company that does practice management research and client surveys for advisors, and now actually the owner of Absolute Engagement, a new practice management research business, studying how exactly we as advisors can find a better level of engagement and success in our own businesses. I was really excited to talk to Julie for the podcast since here we’re all about understanding how to be more successful as advisors, and the focus of Julie’s research is literally about how to be more engaged and successful in our businesses.
So we’ve talked to some advisors, and now we’re going to hear what the research has to say. And Julie really has a lot to share, not just on this topic, but as an entrepreneur herself who’s founded a business, built it, sold it, and is now building another one, and transitions that were all driven by her own changing desires and goals about how to enjoy your life in business and find her own work life balance. And we actually talked about a lot more as well. Julie’s research on getting more referrals, why asking for referrals usually isn’t helpful, why the infamous, “I get paid in two ways,” line is actually a worse way to get referrals, and what you actually need to do if you want to become more referable and drive more business. So with that, I hope you enjoy this episode of the Financial Advisor Success Podcast with Julie Littlechild. Welcome, Julie Littlechild to Financial Advisor Success Podcast.
Julie: I am so happy to be here, really excited. Thanks for having me.
Michael: Absolutely. I’m excited having you joining us, really for two reasons. That you’ve got an interesting business, or actually two businesses that you’ve had over the years around serving advisors, working with advisors, giving them advice about how to run their businesses together, and I want to make sure we talk about that for a while, but also that you’ve had your own interesting entrepreneurial journey as someone who made a business and grew it and now has moved on to that and is doing another business. So I’m actually very curious to hear your own perspective as an entrepreneur and business owner as well as the advice you can share to advisors around this.
Julie: Yeah. It’s so true. I think a lot of us get to the point where our businesses are kind of a reflection of our own journey and it’s almost hard to see the difference between the two.
Michael: Yeah, I think particularly when you get into our advisory world where so many of us are solo business owners and entrepreneurs or running at least a quasi-independent path, maybe an independent broker-dealer, but it’s nominally our business, where yeah, I mean the business is you, you are the business. We now know on the backend that means it’s really hard to sell because it’s kind of like selling a piece of yourself, but it also means for so many of us the business becomes a reflection of ourselves, and I find even one of the biggest challenges for a lot of advisors when they really want to build businesses is actually figuring out how do I make the business not about me but actually about the business? Because that’s a hard thing to do.
Julie: Yeah, absolutely.
How Julie Got Into Practice Management For Financial Advisors Before It Was Widely Acknowledged As A Needed Service [3:41]
Michael: So how did you get started in our financial services world? What brought you into this space in the first place?
Julie: Yeah, it’s one of those things where I’d like to say, from a young girl I knew exactly I was going to be here. Of course that wasn’t the case. Like a lot of things, there’s a lot of chance and luck in these things. I was in business school. So I had started my career in marketing and communications and then went back to do my MBA, and as I was coming out of business school where I studied finance I began to work with, I connected with a guy who was doing consulting primarily with advisors and mutual fund companies at the time. We’re going back about 20 years now. I connected with him and it was like I walked into this entrepreneurial business, he was in financial services, and that was one of those lucky connections that actually then propelled me to stay here for all these years.
Michael: And so the business, we’re talking mid-1990’s?
Michael: So mutual fund sales was kind of the reigning paradigm of the day and the internet hasn’t really changed our world yet.
Julie: Yeah. I remember very specifically the focus was so much on mutual funds and how they could market effectively, but we started doing some research, and this was probably, I don’t think I realized it at the time, how oriented I was toward evidence-based material, but we ended up going out and saying, “We really want to understand how top advisors tick,” and I think we interviewed, I don’t know, 250 advisors or something. I took on this project, and I think that’s what started in the back of my mind somewhere to really lead me down this path of, what really does make advisors successful and how can we look at that in a more quantitative way?
Michael: So you were doing this initially with someone, in someone else’s firm.
Michael: At some point you made a transition to start your own.
Julie: I did. So we were a small company when I was with this other firm, and I grew with the firm, we added a number of employees, and got to the point where quite literally there was nowhere to move, you know? It was a small company, there wasn’t anywhere else I could go, and I had this entrepreneurial buzz, wanted to get out and do something on my own, so did that initially in a collaborative way with the individual I was working with, and started Advisor Impact. So yeah, it took me a little while to figure out what I wanted to do, and it changed a little after I started doing it, but I did go out on my own at that point.
Michael: What pushed you to take that leap? Because I almost feel like there’s a parallel, like, a lot of advisors I know have had some very good entrepreneurial minded folks come up within their firms, and then lost them because the person went out on their own. So I almost feel like there’s a question, is there anything he could have done to keep you that, like, we can draw as a lesson here about how to keep your entrepreneurial minded team on your team rather than going out to do their own business?
Julie: Yeah, you know what, I think if it had been a situation where there was real partnership opportunity, and I don’t think that business could have sustained that, to be honest. I don’t think it would have been the right choice. But if I could have taken on a piece of that, I might have stayed, but the other thing was I found a real natural inclination around practice management at that time, and in a way it was a bit of a nascent area. People weren’t talking about it that much. But I was really drawn to it.
Michael: We were all just salespeople at that point.
Michael: There wasn’t a practice. There were just-
Julie: Just sell stuff. Get out there.
Michael: Right. I mean I’m not trying to totally bash our industry, but just, you know, in the 90’s training was, how do you sell more stuff or how do you learn more about the product that you were selling. Big advisors, “advisor” in air quotes, I guess, big advisors had a sales assistant, and you went and saw more clients and sold more stuff.
Julie: You did, and even when we started, a lot of what was of interest was, how do I grow the business? And then it almost felt like it followed this natural path where advisors were adding and adding and adding clients and assets and revenue, and then they hit a wall and couldn’t manage it, and were starting to feel the strain. So the work that we began to do, both individually and then on my own, was in response to that. It’s like, okay, you’ve grown it, but what are you going to do now? How are you actually going to manage it?
The Business Model At Her Coaching Business, Advisor Impact, And How It Informed Her Later Entrepreneurial Efforts [8:23]
Michael: So what was the original business model for you at Advisor Impact? Was it just getting hired by individual successful advisors who’ve hit a wall to help them get over this wall?
Julie: Yeah, it was a bit of an interesting start because my thought was, I’d been doing some coaching and my thought was that I would continue to build out a practice management coaching program that in essence dealt with the fundamentals. I think, again, you look back and you think this was pretty much practice management 101. How do I segment my clients, how do I communicate on the team, how do I ensure that I’ve got a service plan that’s profitable? And I thought, yeah, I’m going to go out there and I’m going to be a coach. I got a few clients and then I realized, A, I did not like coaching, and B, I wasn’t particularly good at it.
Michael: Well, that’s a good crossroads to hit.
Julie: Yeah, you’ve got to think, huh, what am I going to do now?
Michael: So at this point you were out on your own.
Michael: Running a business you don’t actually enjoy. Running a business that delivers a thing you don’t actually want to do.
Julie: That pretty much sums it up, and it was odd because people were paying me money, but you know when it’s just not…You can do it. What I realized was I was a pretty good subject matter expert, but I wasn’t a coach. I think coaching is an incredible skill, and I have an enormous amount of respect for people who have that skill. I just don’t consider it one of my own. I just needed to figure that out, and I did.
Michael: I mean, how do you make that kind of transition? Is it just one day you’ve got a coaching call coming up and you’re just dreading it and saying, “My god, I just have to do something different”?
Julie: Yeah, there were two things. One, I do think there’s an element of that. In fact, I kind of go with that feeling today sometimes as well, where I might take on work, and I don’t dread it in the sense of, you know, I know it will be pleasant, but somewhere in my gut I know if they called and said, “Can we postpone?” I’d be, “Yeah, you sure can,” you know?
Michael: Yes. I think we’ve all had those kinds of client calls. Like, “Oh, darn, we’re rescheduling.”
Julie: “Okay then.” So I do think there are signals, and I was getting some of those signals, but the other thing that I did know pretty early on is that I couldn’t scale it. For whatever reason, and I’m not sure why at that stage I knew it, I knew I didn’t want it to be just me. I knew I wanted to create some value in the business, and I couldn’t do that effectively with coaching.
How Conducting Client Satisfaction Surveys Really Can Help Inform Advisory Firm Owners To More Effectively Grow The Business [11:02]
Michael: So how did you start shifting it, then? Because that’s got to be scary from a business transition perspective and just from a personal income, like, “Great, I’m finally making some money. Let’s walk away from that.”
Julie: Well, that’s the thing, and I tell you what, you know, I’m your classic working class family, never had anything, started the business with literally zero dollars and went on revenue from day one. I’ve bootstrapped everything. So it wasn’t a choice for me to just change one day. So there was a transition period. Well, first I had to figure out what I was going to do, which I can talk about because it started to become apparent to me through the coaching, but also it took me quite a long time where I reduced the coaching I was doing and brought up the other side, but the one thing, and it wouldn’t have happened without the coaching. It’s interesting. I was going and I was talking to people about their business, and almost every time within the first conversation we’d start talking about their service model, for example, and I would ask some question like, “Well, what do your clients think?” And everybody looked at me like I had two heads, and it became apparent so quickly that we were just an industry that was operating with very little meaningful input from clients. So as part of client engagements I would say, “Let’s go out and survey your clients. I’ve got some skills in this area. We can develop something.” It was incredibly rudimentary, but that was actually the start of the real business, was going out and gathering feedback.
Michael: So I know for a lot of advisors there’s always this gut response, like, “I’m the business owner who’s making the thing, the product, the service, the widget, the whatever it is available. It’s my job to show them what they want.” The infamous Henry Ford, “If I asked them what they wanted, they would have said better buggy whips or something.” So what’s your response to that when advisors say, “Why would I survey my clients? They can’t articulate what they want. They don’t even know they want financial planning until I do it for them, and then they say they love it.”
Julie: Yeah, well, financial planning is definitely a tough one because it is one of those things that, until you’ve experienced it, it’s hard to know, but I think anybody who just said it out loud, like, “The client’s at the center of my business, but I have no quantitative information on what they feel, think, or believe,” and when you say it out loud, it sounds a bit silly that you wouldn’t ask your clients what they thought. So it was clear to me that if they were going to continue to build a business where it wasn’t just a good product and it wasn’t just good advice but was an experience that was really going to be deep and engaging, they needed to go a lot deeper with clients. It was also pretty clear to me that if they did it well they could uncover a ton of opportunity in their businesses, and that certainly turned out to be true. It’s interesting, you look back almost 20 years and it’s kind of obvious now that the way in which we deliver value has changed. At the time it was all kind of firm-centric value like you said, “Here’s what I offer. I hope you like it. I have it in black. That’s what you’re getting,” and it kind of morphed into a bit more client-centric, like having a segmented offer, for example, and I still think we’re moving down a new path for even deeper involvement going forward for the client.
Michael: Well, what are you surveying, then? I mean was this an early version of today’s net promoter score, how do you feel about our services, so I can just kind of take the temperature like, “Wow, my clients are really happy,” or, “Wow, they’re actually really unhappy. I probably need to change something.” Are these like take the temperature of the clients and what they’re thinking? Or is this like, I’m surveying my clients as I’m kind of trying to come up with the next three services I’m going to roll out?
Julie: Yeah. I would say that if you talked to advisors at the time they would have said it was the first. Every time we said, “Why are you gathering feedback?” I just want to know that I’m doing the right things, that my clients are happy. I consider that a very light metric. I don’t think it has a ton of depth. I think it’s important to know. If you’re doing a really bad job, the data will show that. It doesn’t show deep engagement however. I think you need to ask some more clever questions. What I really believe, and believed at the time though was, in addition to getting that benchmark for your business, which was probably the first time a lot of them had that, is that this kind of quantitative feedback was a prelude to a deeper discussion with your clients, and maybe the kind of engaging discussion that they’d never had. So if you can ask clients not just, “How am I doing?” That’s like saying, “How do you like me so far on a scale of one to 10.” It’s not that helpful, but if you go a little deeper and ask them about different parts of the service or where their challenges are or what kind of communications would be effective, and then talk to them about those results, not just gather the data, then I think we’re on to something that goes a little deeper.
Michael: So I know for a lot of advisors now, we’re just thinking like, wow that sounds time consuming. I mean how much time effort was it taking for firms to do this? I mean obviously you had a service that was helping them with it. So I guess we start with here, what did Advisor Impact do? What did the advisor do? What was the typical process?
Julie: So Advisor Impact really did two things. The core business was the client audit, which was the client feedback tool, and in addition to that we did ongoing investor research so that we would also have a robust benchmark as a point of comparison, and were able to speak intelligently, and add some value around what clients really wanted and how they could use the information. You know, yeah, you could go out, and you still could today and get Survey Monkey, you could figure out all the questions, you could send it out. It probably wouldn’t be great. It takes a lot of time, and I thought that if we could create a process that was customizable but relatively turnkey, that an advisor could go in and spend maybe an hour or two up front to make sure the questions made sense, it was executed on their behalf.
So we customized the questions, gave them the links to send out, analyzed the data, but the real value to me wasn’t all of that, because frankly a lot of people could figure that out. It was on the backend, how do you take the data and feed it back in a way that is helpful? So you take net promoter score, it’s not a bad metric to me. I find it has limited value in terms of being actionable. It’s a good measurement, if you know what I mean, but it doesn’t necessarily then say, “Okay, how am I going to use this information?” So we would ask things like, “Have you provided a referral in the last 12 months?” and then an advisor could get a list of everybody who had, and then we’d teach them how to have a conversation about that. So it was that kind of practical stuff that I thought might be missing.
Michael: And you found interesting stuff, I guess, when you started asking clients, “Have you provided a referral in the past 12 months?” because obviously for most of us , we build our businesses primarily for referrals, we’re basically taught and told the best practice is the best advisors get the majority of their new clients as referrals from existing clients. So what did you start finding when you began to gather this data about advisors trying to get referrals and how can I get more referrals?
Julie: When we first went out we were asking the same question everybody was asking, in a way, which was, “Are you comfortable providing referrals?” About 90% of clients on average will say, “Yes, I’m comfortable doing that,” which creates this form of frustration, I think, for advisors who are like, “If you’re comfortable, why don’t you do it?”
Michael: Why aren’t you doing more? Right.
Julie: Yeah, just go on ahead. I’m right here. Then I don’t know, suddenly one day we said, “Hang on, that’s actually not the right question, because that’s just a proxy for satisfaction.” But to ask, “Have you referred?” seemed more actionable, and what became really clear, and year after year we still see this, about a third of clients say they’ve referred. Advisors say they’ve met referrals from about 3-5% of clients. So we’ve got this gap. So it started to become really clear that, hang on, the problem actually isn’t getting more referrals. It’s that you’re not meeting most of the referrals you get. That has a very different feel to it.
Michael: So let me put this in numbers. So I’m an advisor that’s got 100 clients, just because it makes the math nice and round and easy. So typical advisor will say, “Yeah, I did prospect meetings with somewhere between three to five client referrals.” This was over the past six months or 12 months?
Julie: Twelve months, yeah.
Michael: “So I’ve got 100 clients. I did some meetings with three to five, I guess referrals. Maybe one client referred a whole bunch, but like three to five clients gave me referrals.” Then you went and surveyed, and 30+ of the clients said, “Yeah, I gave my advisor a referral in the past year.” So we’re off by like a 10X factor of client says, “I referred,” and 90% of them the advisor never met.
Julie: That’s exactly right, and it raises the question, what’s going on? I give people the benefit of the doubt. I assume the clients weren’t lying about these things, and especially since I’ve done this research probably eight or nine times over the years, and it’s always in the 25-35% range.
How Julie Started Studying Ways In Which To Help Clients Better Communicate Their Advisors’ Value To Family And Friends [21:22]
Michael: And to be clear, you’re doing these surveys kind of third party, I mean this isn’t like the advisor sitting down saying, “Did you refer me in the past 12 months?”
Julie: Yeah, that’s right. I didn’t even use the data from those surveys as our benchmarks, because it was skewed. The only people who used us to survey their clients were people who’ve generally felt they’d do pretty well, right? Nobody ever came to me, not once, and said, “I deliver horrific service. I’d like you to survey my clients and prove that point,” right?
Michael: So your one third number was, like you just did generalized consumer survey research? Do you have an advisor and if they say yes, you say, “Did you refer them in the past year?” and a third of those said yes?
Julie: Yeah, with some caveats around assets and whatnot. So it’s a representative sample, yeah.
Michael: Okay, wow. I mean that’s powerful. To be fair, there are a lot of stats that get thrown around our industry a lot that tend to have, to put it kindly, some sampling issues around where that data came from.
Michael: So that’s a big deal. How did you get your investor consumer data then? Who did you survey or how do you find objective, neutral third party people to ask these kinds of questions to?
Julie: Yeah, I mean getting consumer research is never easy. So we typically use panels. There are arguments pro and con on everything. Somebody could argue if anybody’s on a panel they’re biased, but as long as your sample’s big enough, you can eliminate some of that bias, but that’s basically what we’d gone out almost every year and done, just said, “Look, we want people who work with financial advisors, they either make or contribute to the financial decisions in the household,” and then we set some quotas around different asset levels so that we can speak to the different types of clients.
Michael: And how many people would you ultimately survey? Is this like you get dozens of people, you get hundreds of people?
Julie: A thousand.
Michael: Okay. That’s a very large sample.
Julie: Yeah. If you go over 1,000 you margin of error really doesn’t change very much.
Michael: All right. So big, broad based surveys year after year, and just continuing to find about a third of clients say, “I refer my advisor,” and then most of us really only have like a handful of clients. We say, “Yeah, Jim refers me a lot and Sheila does sometimes, and then a couple trickle in, and that’s about it.”
Julie: Well, yeah, and even more striking was that when we asked, “How many did you refer?” the average is two people. So we actually double-
Michael: So if I’ve got 100 clients, I should see 60 prospects based on what the clients say they’re referring, and instead I get like five to 10.
Julie: Yeah, and of course it’s never going to be 60, but there’s definitely a massive gap there.
Michael: All right. So then the natural question here, so where are 90% of our referrals going?
Julie: Yeah. Who’s taking those people?
Michael: Like, is there one person out there that’s just like grabbing all the clients and picking up everybody’s referrals? Where do they all go?
Julie: It’s the referral snatcher, Michael.
Michael: I know. First of all, I want to meet the referral snatcher and have him on the podcast.
Julie: Yeah, exactly.
Michael: So where did all of these referrals go?
Julie: I mean the simplest way to look at it is they were referrals, not introductions. So the reality is the advisors didn’t meet the vast majority of these people, and as we dug into the data a little further, where the leaks are is simply that clients aren’t referring particularly well. You know, they’re not articulating value particularly well, they’re not connecting. Very few of them are true introductions in the pure sense of the word. Now, all of this, there are things we can do about it.
Michael: Wait, let me pause there. So a little bit of this is kind of, we’ll call it loose use of the word referrals. So from the client’s perspective, I’m at my office cocktail party, because we’re coming off the holidays, and my coworker says, “I’m really aggravated about what the company’s doing with all the stock options,” and I say, “Oh, you should call Julie, my advisor. She’s great with this stuff.” I walk away saying, “I’m awesome. I helped Julie. I gave her a referral,” and my coworker goes home and probably doesn’t even remember the conversation or is like, “I think her name was Julia-
Julie: Barber something.
Michael: Yeah. So a lot of is that kind of loose referrals, is at least some of the gap here?
Julie: It is, and I think that example kind of highlights a missed opportunity, but also what really goes on is, so in one scenario you could say, if we could educate our clients to articulate our value a little more purposefully, which of course assumes we can do that, then instead of it being, “Yeah, you should call Julie, and can you hand me a cocktail wiener,” it’s, “No, you’ve got to call this person. Let me tell you a little bit about what they’ve done for us.” So I think that’s part of the issue. I think the bigger missed opportunity that we saw, though, had to do with the fact that a lot of referrals don’t come because somebody says, “I’m looking for a financial advisor.” I mean that’s kind of the low-hanging fruit. That’s the easy stuff. It’s more about when somebody’s really talking about a challenge in their life and your client can step in with a solution. So I’m out with my girlfriends and we’re talking about, you know, family, or I have a lot of friends who own small businesses. So all our money’s in the business. Is this the dumbest thing we’ve ever done? We don’t seem to be investing outside the business. Or I’ve got a parent who I need to care for. Whatever, people just talk about. Because I don’t know about you, I never actually talk about financial advisors other than with people in the industry. This may be surprising.
Michael: Yeah, I joke about this all the time. A lot of us are in the business of selling comprehensive financial planning advice as either our core value proposition or our key value add, and I’ve never actually met a person who woke up at 2:00 in the morning in a cold sweat going like, “Oh my god, I’ve got to find a comprehensive financial plan or I’m not going to be able to fall back asleep.”
Julie: That’s exactly it.
Michael: I mean, you know, I’m going to lose my house, I’ve got a debt problem, oh my god I’ve got two kids and no college savings. I’m starting to freak out one random night. Those are things I’ll wake up in the middle of the night and freak out about, but no one wakes up and is like, “Oh my god, I’ve got to find me a comprehensive financial plan or I’m not going to be able to fall back asleep.”
Julie: I know, it’s surprising.
Michael: No one’s searching for this, and yet it’s what we sell.
Julie: And yet, so exactly what you just said is the problem. So the more that we can help clients understand those problems that we solve, we want to help our friends, right? We’re just wired this way, unless you’re just nasty and mean. Most of us really want to help our friends. So if I’m talking to somebody about the fact that they’re stressed out about aging parents and money and they don’t have it in order, and I know my advisor deals with that, I want to make a referral. And frankly, it’s not for my advisor, and this was really the key finding of the research. I’m not referring to help my advisor. I’m referring to help the friend. Once we can get that framework in place, I think it helps us position for referrals more effectively.
Why Proactively Asking For Referrals Might Actually Be Working Against You [29:20]
Michael: That’s a powerful point to make, right? Because a lot of us have been in the industry and we’re all trained this way, and I know I still literally see this in some advisors’ email signatures, “We get paid two ways. The first way is that you do business with us and buy our products and invest with us, and the second way that we get paid is when you refer us to your friends and family.” So the conclusion of your research is basically that’s crap? Like we need to stop doing that because my clients don’t refer Michael because they want to help Michael. My clients refer Michael because they want to help their friends, and Michael’s the problem solver.
Julie: Well, yeah. They don’t not want to help, right? I mean it’s a happy byproduct if they really, because obviously they’re engaged with you to want to refer you, but yeah, it’s like we’re just not tapping into people’s motivations. We’ve got to understand what motivates somebody to refer if we’re going to increase referrals. So we’ve got to really start focusing on, what do they talk about. And I think your example is a good one because that is what people talk about, right? They talk about those problems, and that they woke up in the middle of the night screaming about, and they’re just looking for solutions.
Michael: And I wonder, that whole, we get paid two ways thing, I have to admit again, if we wind the clock back 10 or 20 years, most of us got paid with an indirect commission from the insurance company or mutual fund provider that the client never actually saw. So if I actually, I did a financial plan for the client and then I implemented them into a bunch of B share mutual funds, and I got a check and the client never saw it, it was actually a little bit legit that I went to the client and said, “Well, you know, I get paid two ways. The first way is that you invest with me and the second is through referrals,” because the client never actually saw the payment from the first time. So they probably felt a little bit indebted. Like, “Michael did a lot of financial planning work for me and I never wrote him a check. So I guess this is a way that I can give the reciprocal giveback for the service that he gave,” because he never saw the commission, but particularly now in a fee-based world, I have to admit I don’t know very many people who are like, “You know, I pay my advisor 1% a year, but I feel like she’s so underpaid that I really want to also-
Julie: Poor thing.
Michael: I need to also give her some referrals to true up the karmic balance between us. I mean it almost feels like a strategy that’s, that version not only does it not speak to the core motivation, but it kind of worked when they never saw the commission. It probably really doesn’t work when they see the advisory fee and they know what they’re paying us.
Julie: Well, also I don’t think of my friends and family as a form of currency, you know? I can’t go and buy milk with them. The guy at the store doesn’t say, “I’m giving you a discount on your milk, but make sure you send your mom here to buy it.” It’s almost like a veiled threat. I remember those versions, and it would get a little worse, where it was, “Unless you refer me, I’ll have to spend more time on marketing.”
Michael: Oh yeah, I won’t give you good service. Right, the implied threat. You won’t get good service.
Julie: Yeah, sorry.
Michael: Because I’ll have to go market instead of taking a phone call. So what’s the alternative? I’m going through my head now of all those things that I got trained in, starting out in the insurance world in my early years. There was the, “You get paid two ways,” thing which I guess now we’re really poo-pooing, but there was also the, “If you want good referrals from clients, you pull out the piece of paper and you ask them to write down three names of people that they know that would be a good fit for your services, and while frankly I could never bring myself to do that because it felt too awkward for me, I do at least get it. I know the introduction’s not going to slip through because I’ve got their name and I’m going to call them. Right? So there’s an assuredness that at least if I get the client to give me the name as opposed to having the client give my name to the referral that now at least the ball’s in my camp. So I can make sure an introduction happens. So do we still need to do some version of that, so we make sure that referrals become introductions because otherwise clients give wishy-washy referrals?
Julie: Yeah. Well, I think there are different levels of that. I think the core issue with that strategy is, I mean you could put a gun to my head right now and I don’t know who would be a good fit with my financial advisor. I mean, I don’t talk about this stuff with my friends, and it’s not that we wouldn’t. I just don’t know, even though I would refer him. So I think the first piece of it, which is just more, how can we focus on the challenges? So that would be something like, as an advisor, let me identify the two or three challenges that I hear most. Just like normal person type challenges. I’m worried about my kids making stupid financial decisions, my parents are aging and I’m not sure how to handle this, whatever those common issues are, I want to create a legacy of some sort, what does this all mean, then build something around that, because this is what they’re going to talk to people about.
So share content that supports that, and people will share it. I always use this really simple example of something like, you know, the Secret Millionaire’s Club, which is Warren Buffet’s online kids…I’m sure he’s not involved in it anymore, but you know, like sharing those kinds of links, that will get shared. That’s a form of introduction. The second piece though about introduction I think is right. So then it’s like, well what happens? Okay, I know you deal with families, and I’ve got a friend of mine who’s been talking about these challenges. Now I’m going to be worried you’re going to call them all the time. So we’ve either got to map out a process that says, “Look, if you would like me to call, here’s my promise to you. I’m going to call once, I’m going to send them some information. If they’re not interested, I’ll lose the number immediately. We will never follow up again,” or, “I’ve got this great video I’ve just recorded on financial literacy for kids,” or, “I’ve got this article I wrote. Would you mind passing it along?” You know, creating that kind of connection I think is more powerful.
Michael: Interesting. So two options there. Number one is just actually saying when you ask for referrals, “Hey, I just want to let you know really fast, if you give me someone’s name to reach out to, I’m just going to contact them once and let them know what I do and that you had given me the name, and I’m going to be very professional about it, and then that’s that. So you don’t have to worry that they’re going to come back to you and say, “You turned Michael onto me and now he won’t stop calling me.” So do you just literally verbalize that? Like you say to the client when you’re asking for the referral, “I just want to let you know how we handle these situations so you don’t have to worry about giving me a name”?
Julie: Yeah, I mean I think you can, and that could just be on the heels of…What we find is that you’ve got this friend you really want to help. I think we can probably help them, but things slip through the cracks. So what we’ve found is if you make an introduction then you can get out of the middle and let us follow us, and then kind of follow up from there.
Michael: And then the second option is like, or I make some neat content related thing and just say, “Hey, share this,” and have confidence that it’s going to be so awesome that the person is going to say, “Wow, that was really cool. Can I talk to you? Can you work with me?”
Julie: Yeah. And again it could be something that’s subscription based where you’re getting email addresses in order so you could put a video behind a wall so that you do get the names of people. I mean there are a lot of ways to do that now that are pretty easy.
Michael: But I feel like for most advisors, we’re going to get stuck at step one, which is like, “What do I talk about? Okay, make a video. Of what? What am I supposed to produce that gets people to give me the referrals?”
Julie: And that’s probably taking it down a path of somebody who really wants to think about this, but I think if you could, I mean it could be something as simple as this. What are the two or three issues you hear most about? I have young parents that are talking about financial literacy. Let’s just use that as an example. I’m going to go online right now and I’m going to find three extraordinary articles on that and then I’m going to create this campaign where I’m sending those out every couple of weeks. Something easy that can be done and can be shared. You know, all the bells and whistles and come later. It’s just a simple place to start.
Michael: Well, and certainly I can attest to a version of that through what I do on the blog, the Nerd’s Eye View activity. There’s no question, we’ve gotten referrals, we’ve gotten client inquiries that came directly off of person read article, thought it was, I was going to say cool, but I write giant technical articles. So that’s probably the wrong word. But thought it was sufficiently nerdy and interesting.
Julie: Yeah, high nerd factor.
Michael: That they sent it to someone else they knew who had a problem, and then that person contacts us usually with something like, “I read your article and that was a little beyond me, but you clearly know what you’re talking about, so how do we work together or can we work together?”
Julie: Exactly. And look, I won’t have the exact stat, but I think it’s important here. When we went out we asked, “Have you provided a referral?” So we have our 33% in the last study that said yes. So we still have a majority who said no, even though they’re satisfied, right? Most of these people are incredibly satisfied. So we went to that group and said, “Why didn’t you provide a referral?” About 65% of the people who didn’t refer said it’s because I don’t know who to refer.
Michael: Okay, so this is like my advisor’s got a $1 million minimum and I don’t know who has $1 million, and the last thing I want to do is refer my friend and then have them get rejected because they don’t have the $1 million. So I’m just not going to refer anyone, and that way I don’t have to worry about referring the wrong person.
Julie: Yeah, and also spotting a referral opportunity. People aren’t usually aren’t looking for an advisor. They’re looking for a solution to a problem, right? So I think we think about referrals as, yeah, if anybody asks me, I will refer my advisor. What we’re trying to teach clients to do is, when you hear about this problem, you should refer us, because we’re a solution to that.
Michael: Except I feel like the advisor, I’m a comprehensive financial planner. I got trained in 89 topics or however many on the CFP Board’s list. The answer to the client of what problems I solve is supposed to be all of them. Stop worrying so much. Just send them to me and I’ll let them know if I can help.
Julie: And this is the equivalent of not getting any referrals, right? I think this is the challenge. We’ve got advisors who are smart, who have a ton of knowledge, who know a lot about a lot of things, and really what I’m asking them to do is four referrals. Narrow that down to a few key challenges that a lot of people face and a lot of people talk about. And people find that hard to do because it’s like saying, “What about all the rest of that cool stuff I do?”
Michael: Like how many referrals am I going to lose out on if I only give my clients three suggestions and fail to cover the other 97?
Julie: Exactly, and the answer is none, because they’re not referring that much or you’re not meeting most of those people anyway.
Michael: I guess that kind of is the key point, right? Say you got three referrals last year. Clients said they gave you 60. You got three. So how many do you think you’re going to lose by trying to be more specific?
Julie: Not those three.
Michael: There’s not a lot of downside at this point.
Julie: There isn’t. I’m quite convinced that there is a natural level of referrals, that if you just do good work, you know it’s like Gladwell talks about connectors. There are people out there who just want to tell people about you, and they’re wonderful and we hope we have them, but there’s probably a limited number of those in your client base. So you could do nothing and still get referrals, or what we’re really talking about is what happens above and beyond that? What could I do in a more proactive way to bump that number up?
Michael: Well, and it reminds me. So I had a version of this that came up a couple months ago. I was speaking at an event with two other advisory firms. We were invited in by a third party group to talk about estate planning strategies and issues. It was kind of an income and estate tax planning seminar basically for some fairly high net worth folks that were getting gathered in the room. And I was the representative from our advisory firm and there were two other very large, very capable RIA’s that were there as well. So as it turned out I was third out of three in line as we were doing introductions.
So the first person stood up and said, “I’m Joe. I’m from so and so firm, and we’ve been here in the area for 27 years and we manage $2 billion and we do comprehensive financial planning and risk management and investment management and we also do a lot of sophisticated tax planning,” because of course that’s the topic of the day and that’s my background. I’m a CPA and a tax attorney. Then the second person stood up and said, “I’m Mark and our firm’s also been here in the area for about 30 years now. We actually manage about $4 billion from our combination of institutions and affluent individuals like a lot of you in the room and we do really advanced tax strategies and a lot of work in estate planning as well, and so I’m looking forward to talking to all of you about that today.” And so then I got up. I’m like, “Basically our firm does exactly-
Julie: Exactly the same thing.
Michael: -what the other two guys said, but we tend to skew toward retirees. Most of our clients are kind of within five years of retirement or in the first 10 years after retirement.” And so I stood up and said, “I’m Michael. I’m a Director of Research at Pinnacle Advisory Group. We’ve also been in the area for about 20-something years and have $1.5 billion in our management, but we work primarily with retirees. Most of our clients are within about five years of retirement or into the first five or 10 years of retirement. We actually help them with a combination of retirement income distribution strategies, so coordinating portfolios with the timing of when to start Social Security and when you get Medicare going. We tie a lot of income tax strategies into that, we work with partial Roth conversion strategies and similar. Then for our clients who are actually going to accumulate more than they even need for retirement we do a lot of estate planning about what happens with the assets they’re not going to spend down in retirement.”
So it was like a very retiree specific pitch. So there were about 50 people in the room. I would guesstimate probably half the room I basically disqualified on the spot because they either had not enough gray hair or far too much gray hair, anyone in that retirement minus five plus 10 year window, but I watched three or four people who were like directly attuned in when I was saying it because I could see they were 60-something, in my target window. I actually watched, when I made the comment about timing Social Security I literally watched one woman elbow her husband and point at me when I said it because it was clearly a particular problem they had.
Julie: They’d been talking about that.
Michael: And when we got to the end of the session, you know, we all did a fine job. I knew both the other panelists. They’re very good speakers and very smart folks, and they talked just fine on a panel, but we got to the end of the panel and the first gentleman got no business cards and the second gentleman got no business cards, and I got four business cards from people who were in their 60’s who needed help, including the couple with the elbowing wife.
Julie: The elbow woman.
Michael: Grabbed something and brought it up. I mean it was just that thing of, they were broad, I was specific, and as a result they were qualified to work with all 50 and got none. I was qualified to work with only 25 and I got almost a quarter of them.
Julie: First of all it strikes me that, yeah, A, you were the only one who didn’t talk about you. You talked about what you do for other people, you know what I mean? Which is key. But at the end of the day you want to work with someone who understands you, right? I’ve been talking a lot about this with you and others. I’m not alone in this view about target marketing, but when you do it well, people are drawn to it like a magnet, because you say, “Look, you just get me,” and absolutely it’s going to increase, but it’s a frightening concept for some, for many.
Michael: Yeah, I mean there’s really a mindset shift, right? To say I’m not going to worry about the fact that I’m going to disqualify myself from half the room. I just want to get a small fraction of the room I actually can connect with, because that’s still more than the zero everybody else is going to get by making the net so wide they don’t actually catch anyone.
Julie: Absolutely. And I mean we all deal with this. As you know, I just finished writing a book, and I was thinking at one point, you know, I should make this a bit more broad, and I talked to a guy who’d been in publishing for years, and he’s like, “Don’t do it.” I didn’t really want to. I knew where I wanted to write, but he’s like, “You’re going to dilute that message so much that it just won’t be effective,” and I think it’s true.
Why Julie Decided To Sell And Leaver Her Business, And The Rocky Transition To A New Venture [47:40]
Michael: So you built this business of doing client audits? I guess that was literally the survey product was called the Client Audit. I guess then you’re doing consumer research so you can pair it to it. So that seems to have been going well. I still, correct me if I’m wrong, I still don’t know anybody else that actually does that now.
Michael: So that ostensibly was going well. You’re not doing that now. So what happened? What changed?
Julie: A few things changed. I mean first of all, I had built a nice business. You know, it was doing reasonably well, and a couple of things happened. One was that I knew at some level, although I don’t think I had articulated it, that I wanted to do something more and different, that I had been down this path for long enough and it was time for me to do something different. But the real pivotal moment was nothing to do with work at all. It’s when I knew my son was being born. I can literally tell you that it was almost to the day that I began to look for someone to buy the business, because I looked forward and thought, okay, it’s time for me to get a little more…By the way, none of what I’m about to say happened. Lesson learned, but I wanted more time, I wanted more flexibility, and I didn’t want the stress. You know, I was 45 when my son was born. I waited a long time for that. So I was like, okay. So I started to look to sell the business.
Michael: So it was personal event driven just to say, “I’m not at this…I need a work life,” I guess as we call it, a work-life balance decision, my life has changed, and so I just don’t want to be the business owner driving this thing right now. I want to do something different that lets me spend different time with family?
Julie: Yeah, a lot of it was that. And truth be told, I think if I had been loving every minute of it, maybe I wouldn’t have made that decision in that moment.
Michael: But there were some…Well, I guess as with any business there are some downtimes to it as well.
Julie: Yeah, for sure.
Michael: So what did that process look like and is that, well, advisory industry I feel like, selling our business is kind of weird, because if you’ve got an at all good sized business these days, people are calling you even if you’re not looking to sell, just because they’re looking. If you actually publicly announce that you’re looking to sell you’ll get like 30-50 inquiries in a couple of days according to the FPA Transitions folks. So you had a more unique business, so what does that process look like? How do you go out there and say, “I’m for sale”? Who buys an advisor…I mean how do you even frame it? Were you an advisor practice management consulting firm? Were you an advisor survey data research firm?
Julie: Yeah, it was a bit in between. I think we were seen as a research and practice management firm. It could have been a technology play if I’d built it differently, but it was really that. Now, bear in mind that I was also about to sell after the worst downturn in history.
Michael: So when was your son born?
Julie: In 2009.
Michael: Okay, so you’re having like the epiphany, “I’m ready to sell the business,” at the worst possible time.
Julie: Worst time. Couldn’t have been worse.
Michael: Since you’d ever founded it that you would be trying to sell a business.
Julie: Absolutely. So I knew that I wouldn’t get the value that I could get if I hung on. It didn’t matter to me at that point. I just knew I had to do it. So yeah, I talked to larger firms in the industry who may want to add value to clients. I looked at companies who were other sort of consulting companies, and in the end what I found was a company that was a startup, but at the time a well-funded startup that wanted to build out a program that incorporated client feedback. So that’s ultimately what I did.
Michael: Okay, so the business gets sold and then what?
Julie: Then nothing changes, and so-
Michael: Well, you don’t have the job you used to go to. So like-
Julie: Well, I did though. That was the problem. They also wanted to keep me there. So what I ended up doing was continuing to run a business, and it’s a long, boring story. So I don’t want to get into it, but I should have just walked away at that moment. Lesson learned. We all have these big lessons. I didn’t, and continued to run it in a situation that made it very difficult to run.
Jule’s Thoughts On Whether And When You Should Sell Your Advising Business Entirely Or Simply Fold Into Another Firm [52:38]
Michael: Well, because now you’ve got other masters to answer to who are trying to fit your business line into their business strategy, which is different than when you were running your own business. I mean is that kind of a tip for advisors out there as well, right? Because sell your business versus tuck into a larger firm is a common discussion in our world as well. So is this like a cautionary note against tucking in?
Julie: It didn’t have to be. In this case it was, and in part because it’s really who I sold to, which was really people who’d raised a lot of money, but hadn’t really proven their own concept yet. So that was really the challenge there. Choose your purchaser wisely.
Michael: So how long did you stay with them and continue in that role?
Julie: I did that for the better part of four or five years.
Michael: Okay, so just relatively recently, in the past year or two, finally went down and said-
Julie: Yeah, last two years now. Yeah.
Michael: “I need something new and different.” So how do you formulate that transition? I mean had you been already thinking about what the next business was going to be and kind of plotting your transition while you were still in the old one? Or was there just some, like, moment of, “I can’t take it anymore,” and you said, “That’s that,” and you quit and then the next morning you went, “Oh, crap, I have to figure out what to do now”?
Julie: It was the toughest time I’ve probably been through, because I felt incredible responsibility to the team that was there, to clients. I felt like I just had to keep this thing together. You know, it was really, really difficult. So there was plotting after a while, but no, I was ready to just, I’m just going to keep doing this. Don’t think about anything else. Head down. The pieces that really triggered the change, there were a few. I mean one was quite simply that I had taken on a situation where it was literally impossible for me to succeed, just for various structural reasons. And it took a long time to get there because this was the baby that you’d created, and it was almost like tossing it out. I had to get to that point where I was comfortable saying, “This isn’t mine anymore, and there have been some issues here. So what’s the best thing?” The transition for me was when I got to the point of saying, “Okay, something has to change. So what’s the best way to do this to minimize any risk or damage and just think about what the next thing will be?” That took probably two years.
Michael: So you were thinking more about how to do the graceful exit even than what the next thing would necessarily be?
Julie: Yeah, a little bit. One of my sort of greatest problems is that I, you know, I’m often thinking about those things to the detriment of what I should have been doing, which was really plotting what the next thing will be. So the day that I established the company, I wasn’t entirely sure what it was going to be. I just knew it had to be different.
Michael: I don’t think that’s unique, right? I feel like that’s how we’re frankly wired as human beings, right? Thinking of a new thing that’s completely different is hard and scary, and all that stuff, but I’m unhappy now and feeling very unhappy in my job, that one I can identify pretty quickly and go like, “Okay, so this needs to change. I’m not quite sure what it’s going to be, but this needs to change.” So what did the transition look like? I mean, by the time you, I guess, quit the job where you were, did you know what the next thing was? I mean it sounds like not really. You just kind of quit and said, “I’ve got all these contacts and I know stuff. So let’s start figuring-
Julie: It was a little, yeah. There was-
Michael: I’ll have more time to think about it once I don’t have a job.
Julie: I’ll figure it out. But you know, bear in mind I had a young kid at the time, and you know, you’re the primary breadwinner and there’s pressure and all of that that goes with it, but to some extent one of the things that I did prior to having walked away was I started working with a coach who ended up being incredibly helpful in helping me really think about…Because I was feeling stuck. I literally did not know what to do. She helped me to articulate a different path forward and to begin to take action on that. So that was quite pivotal for me. I assumed I wanted to continue to do the research that I was doing. I did have, you know, luckily a lot of great contacts and ongoing clients that I could work with on the research side. I had an idea that I would build out this spotlight program, which I remember talking to you about, as a revenue generator. So what was kind of interesting to me is like, without even pausing, I just got to work. Right? Okay, I can do this, I can grow this. And it wasn’t until about a year later where I just have this distinct recollection of, and it’s where I’m sitting right now. I was in my office and I kind of pushed my chair back, and I was like, “What do I actually want to do?” and in this weird moment everything began to change, because then I rebranded, I changed the focus, I changed the structure, and that’s been over the last year where life is back to normal and all good.
Michael: And like in the meantime are you going through the stress of not driving the revenue or earning the salary that you were before? Was there at least, like the original sale of Advisor Impact gave enough cushion that you had some runway to figure this out before it got really financially stressful?
Julie: Not a lot. I mean I didn’t get paid everything on the deal. That was part of the problem. So in a way I was trying to make up, I was trying to be profitable from day one, and so yeah, I was. I’m feisty that way.
Michael: Well, I guess the good news of making the leap at that point, you do know a lot of people and have a lot of opportunities when it’s your second business after you’ve spent 15 years building the first one.
Julie: Absolutely. I mean it was very different, and you’re grateful for that, the way that it goes at that point because you do have options and choices. But it did take me a while to figure it out.
Michael: So I’ve got to ask really fast, then. Here’s our good referral opportunity. Do you have a coach that you can recommend that’s really helpful for people who are stuck in trying to figure out this what’s next transition?
Julie: So I worked with a woman named Caroline Adams Miller. She is part of the positive psychology movement. She was one of the original people who was trained my Marty Seligman, and I don’t know how much individual coaching she’s doing, now that I say that, because she’s got a new book coming out, she’s doing a ton of speaking. So it will be interesting to see, but yeah, she was for me the perfect person to work with.
Michael: Okay, and it was just like a self-discovery process?
Julie: It was a, start with what do you want to create, which is in some ways what I talk to advisors about now. Just going through some exercises of you know, you wake up five years from now, what does it look like? But she had a way of making it very tangible, going through exercises where you really were making it real, and all of that started to shift the thinking, because one of the things I’ve become convinced of in the work that I’m doing now is that what stops us from going forward is that we don’t always accept the possibility. We don’t accept that there is a possibility of something bigger and greater that we could be doing because it’s a frightening concept. So I think that’s what she helped me do.
Michael: So out of curiosity, what did you spend or invest in this process? Was this an expensive proposition?
Julie: For the coaching piece of it or the transition?
Michael: The coaching piece of it.
Julie: Yeah, gosh, what did I spend? I think I was doing coaching every other week, and it was probably investing about $600 a month in coaching.
Michael: And how long did that go on?
Julie: Oh I worked with her for a couple years.
Michael: So $7,000 a year.
Michael: I talk to a lot of advisors that kind of wonder about coaching and then balk or are concerned about the cost. I mean did the old firm pay for this? Did this just come out of your own pockets like, “I’m making this investment in myself”?
Julie: Well, I was paying for it out of the new business.
Michael: And it felt like a worthwhile investment for where you were. I guess looking back you’re still happy with it?
Julie: Absolutely, yeah. I don’t know that I would have become unstuck. I needed that. And look, it’s like finding an advisor. You’ve got to find that right person where it gels, but I just love the work that she was doing.
- The goals of Julie’s business today at Absolute Engagement and how it’s starting new and necessary conversations with advisors
The Goals Of Julie’s Business Today at Absolute Engagement And How It’s Starting New And Necessary Conversations With Advisors [1:02:16]
Michael: We’ll make sure we look up her information and have it in the show notes so if people want to follow up and go to the website, we’ll find whatever we can find to see if she’s still accepting clients or doing coaching. So talk about what you’re working on now, then. I mean what is the business today? What are you doing and who are you working with?
Julie: So the business is called Absolute Engagement and that’s also the concept that I’m looking at. So what I study and the business are essentially one. There are different ways to look at it. First of all, the context of where I got to. So I’ve spent years at this point studying client engagement, right? Between the feedback and the consumer research, that was really my wheelhouse, and as I began to observe people that I considered successful, and by that I mean they were not only financially successful larger advisors, but this group of people who just seemed more joyful, you know? They had momentum, they were happy, they were doing the right things, and I sort of pulled the camera back a little, because in the past I would have said, “It’s all about client engagement,” and then I said, “It’s not.” It’s really the interaction between personal client and team engagement. It’s about building a business that starts with a personal vision and then bending the client and team experience to support that, in a way. So overall that’s the concept that I’m really looking at, is how do you intentionally design a business that really supports the life that you want to live, and then how do you make sure your life is such that you have the capacity and the energy to do all of that? So yeah.
Michael: So what are you doing for people? I’m presuming you’re not going back down the one-to-one coaching road. Or maybe you are.
Julie: Clearly not. I was so bad at it.
Michael: Is this going to be a research driven effort? I mean do you want to study us as advisors and figure out what lets us get to these levels of higher engagement, and then we can look forward to research where you’ll share back to us what you’re learning as you dissect us? I don’t mean that in a bad way.
Julie: Yeah, you’re all in my laboratory, whether you know it or not. So that is part of the business. So everything that I do, it’s just me, it has to be evidence-based. So I continue to do research, quantitative and qualitative. I mean there may be revenue associated with it, although that’s not the business model. I’ll continue to do that, though. That’s part of just what I do. The business itself, the work that I do, was part of my own journey. So as I say to advisors, it’s about what’s your personal vision. When I sat back that day, what was really clear to me is what I love to do, in addition to the research, is speaking and writing, and I like the kind of course development side of things, like creating models out of the research. This was a tough thing for me, in a way. I’d always done speaking, I’d always done writing, but I had never had the courage to say, “This is what my business is going to be,” because it’s a whole different game. So it is speaking, it is writing, and then developing resources, whether that’s online courses or live events, to help advisors take action on these concepts.
Michael: Okay, so we can expect to see courses and more tools like that on Absolute Engagement going forward as you kind of produce these things in the coming years?
Julie: Yeah. For example, the books comes out, you know, it’s a great primer on Absolute Engagement, but what we’re developing is the first resource that will be for the advisors who read the book and say, “You know what? I want to do more with this. That’s all very nice to read about, but I want to take some action.” So we’re really starting to design courses around the personal engagement side as well as more advanced client engagement.
Michael: Okay, so these will be kind of tools and things that advisors can try to pick up and implement in their practices for themselves.
Michael: And when does the book itself come out?
Julie: So presales start early December, and it will be physically ready to ship January 17th.
The Three Principles Of The “Absolutely Engaged” That Julie Has Identified And Built Her Business Around [1:06:45]
Michael: Okay, fantastic. So just as we’re going live with this podcast. Just recording a little bit in advance. The book should actually be available in people’s hands. So we’ll make sure that’s in the show notes as well so people can find it. So I’m curious overall, then, as you’re talking about this in your own context as well as, if you’re going to, and I know you’ll appreciate this because you’re evidence-based and data driven, so if you want to study advisors who are successful, you have to define what success means, so you know which ones of us to put under the microscope.
Michael: So how do you define success?
Julie: Yeah, it’s an interesting challenge, and I think you said it right out of the gate. We could look at all the top advisor lists, but it’s not the success that I look at. I look at success now, and granted this has changed over the years. I think we have a luxury of age that does influence how we think about this, because of course it is about financial success. That gives us options and freedom and all sorts of wonderful things, but it’s largely about, for me personally, building a business that supports this personal vision that I’ve got for my life, so that I’m doing exactly the work that I want to be doing with the people I want to be working with and sort of structuring a life around that. From a quantitative perspective it was an interesting challenge, and essentially I had a hypothesis that I started with. The hypothesis was that there was a group of advisors who were incredibly intentional about how they’d built their business.
They’d defined their ideal client and they worked with those clients. They defined the kind of work they loved to do, and they did that kind of work, and as leaders they defined the role that they wanted to play. So when we went out we were able to ask some questions about this, and then backed out. So we created a segment which we call the absolutely engaged, who were higher on those things, on intentionality around clients, work, and role. Then we looked at the impact. So this is what I just found so extraordinary. So yes, they were making more money. I mean I wasn’t that surprised, but it’s important to say. But what was more compelling to me was that this segment, just based on doing those three things differently, reported lower stress, higher energy, better health, they focused on the right activities, they were more confident. So it was this extraordinary sense of not just financial success but wellbeing. That really reflects what I see success as being.
Michael: So this is actually, we’re not just talking about work-life balance here. I mean this is the context of advisors were either literally business owners or at least nominally owners of our client base and who we’re working with. So you’re talking about kind of a blended work/client/life balance? Like I’ve got to have the right balance between my life and my work but also between my life and my clients, and all three are trying to put them in harmony here?
Julie: Yeah, well harmony’s a good word, because I think it’s the alignment. So it’s where it starts. So the principles that we’ve identified is, with this group of people, is that A, it starts with your personal vision. What is it that you’re truly, what is it that you want to create? What do you want this business to look like? That’s got to start with the person. That’s all about awareness and having the courage to set different kinds of goals. That’s where client and team start to come in, because then they support that vision. Instead of thinking about it in isolation, for a simple example it’s not just what does good client experience look like, it’s what’s a good client experience if my passion is to work with professional athletes, for example. I mean that’s just kind of a simple one, but that’s where the client experience starts to bend to the personal vision. Then from a team perspective who do I need on the bus, what kind of development plan do I need in place, what skills do I need, all starting with that personal vision.
So that’s alignment, really. But the work life balance I think is an important part of this because the deeper I got into this, and I could see these businesses being structured in this very aligned way, it also became clear that when you’re absolutely or successful, you acknowledge that you’re also human, and you’re investing, you’re finding ways to hold yourself accountable, whether that’s in study groups or masterminds or what have you, you’re thinking about your health and sleep and all of those things that we need to do to be creative and to have the energy to keep going.
Michael: There’s a part missing. For a lot of people who are listening who probably have no idea what that vision is, what’s the vision-finding process? Like option one is call Caroline Miller. So maybe she’s still taking clients. So I guess there’s a coaching path to try to figure this out.
Julie: Yeah, you could work with a coach, you could work with a colleague, a mastermind group, you could do it yourself. What I really wanted to do, particularly with writing the book, and this is just me, I had to create a model. So seeing all of the data, observing what I’d observed, talking to people over the previous two years about these issues, I mapped out a model, and it does start with an awareness process and through setting some clear goals, through taking action and accountability and renewal. So there’s a level of just self-analysis, which can get some people all the way, and some people only partway.
They may need help with that, and I think a lot of people will. I tell you one thing, and I don’t know if you hear this, this has been the most interesting piece, and you and I were talking about success at one point, and I can’t remember what word you used, but it was almost like talking about the things that you don’t see, right? I think what I’ve realized over the last little while is since I’ve started talking about Absolute Engagement and giving presentations, I’m having completely different conversations with people. It’s very kind of open, it’s honest. I have people coming up to me going, “This is my problem. I’m stuck. I know I need to do something, I know I need to make changes,” and I’m fascinated because it’s like all of a sudden you’re having the conversations we all should have been having for years, which isn’t just about success. It’s about what did we give up in order to be successful, and it seems to be hitting a nerve. I think you’ve obviously sensed it just based on what you’re looking at in the podcast, and it’s rampant.
Michael: Is this the thing where we have to get to a certain place in our careers? Is there a like, “I’ve got to live it right or wrong for a while before I actually feel like I’m not happy with the path where I am”?
Julie: Yeah, and-
Michael: Is this like the advisor’s version of a midlife crisis?
Julie: It is a little bit. I do think there’s a connection to age. I tell you what, when I turned 50, this was like all connected to this, and I do hear that from a lot of people. You know, for some people, they go through the same thing in their 40’s and some people it’s their 60’s, but I think in general, it probably is true. Now, it doesn’t have to be that way, but you kind of look at, there are different scenarios we face. You have some people who get into the business and they just work, work, work. They have no clear vision of even why they’re doing it. Then one day they go, “Hang on, why am I doing this?” And you could be in your 30’s when you ask that. They just don’t have a vision, but for a lot of people, and I would put myself in this category, it’s just that things change. We had a vision, it was a good vision, we worked, we built, we grew a business, and then something started to change in terms of what we really wanted to do, and we’ve got to honor that by then making sure it’s reflected in the business.
Michael: And is this ultimately what you cover in the book? Like these themes, what you’ve learned so far? Is that the focus of the Absolute Engagement book?
Julie: Yeah. It’s a bit about what Absolute Engagement is, it’s about the research that we’ve done, and then it’s essentially a five step process and five key decisions that we need to make in life in order to move ourselves toward that.
Michael: So I guess for anyone who’s listening, your first option for trying to figure out how to go down this road is to go get Julie’s book, now available on Amazon, I’m sure. We’ll put a link in the show notes, and kind of read through it and just start doing this at least self-reflective process and then figure out can you get through the reflection on your own, do you need to bring this to your study group, do you need to find a coach? How do you keep moving that ball forward?
Julie: Yeah, I think you’re right. I think a lot of people need some sort of support in thinking this through, and it could be a spouse. It’s not everybody’s spouse though. So it’s got to be that person who can help you.
Michael: Well, I feel like that’s a really good place to finish, right there. I hope this has been a good, introspective thought process for everyone who’s listening around where is your balance between your work and your clients, between your work and your life? I have to admit I heard recently someone say we have to stop calling it work/life balance and start calling it work/life harmony, because that’s probably a better reflection of what’s going to happen. And I know I certainly live this. A lot of my work I do from home and then I travel at weird hours, and I do try to keep it in harmony. The good news of working from home is I work ridiculous hours, but I can also still take breaks and play with my kids for lunch if I want to.
Michael: It’s not fair to call it work/life balance, but work/life harmony is kind of what I’m living into, and thinking of that in the client dimension as well really resonates with me of trying to find that balance between the three.
Julie: Yeah, absolutely.
Michael: Well, thank you for joining us today, Julie. I hope this is helpful thought for everyone, but I’ve certainly enjoyed the conversation.
Julie: Absolutely. Thank you so much. I’m going to be listening to this podcast because I want to hear you talking to other people.
Michael: Absolutely. I hope so. And you’ve got a podcast that you’ve gotten underway as well now. Do you want to talk about that really fast before we wrap up?
Julie: Yeah, Steve Worshing and I launched something called Becoming Referable which really looks both at literally how do you become referable and then how you leverage that to increase referrals as well.
Michael: So other ways to fill that referral gap phenomenon that we talked about earlier. All right, fantastic. Thank you again for joining us, Julie.
Julie: Thanks so much.
Michael: Absolutely, take care.