The Trusted Advisor

RMA Journal, The, Feb, 2001 by Jeff Sucec

Hard at work to get products and services in place to capture a share of the growing private banking market, banks cannot overlook the people element. A trusted advisor is not the sales-driven professional banks hired at the onset of the economic boom. This article offers five characteristics of a trusted advisor.

A recent PricewaterhouseCoopers survey of private banking and wealth management in North America found that wealth management is at the onset of a three-year aggressive transformation. Key to future success is the transition of sales and services to be customer focused. While scrambling to put in place the products and services that will snare a share of the market, financial institutions cannot forget the crucial role of the trusted advisor.

There is a lot of buzz about trusted-advisor (TA) service. But what exactly is it, and, more important, how do you know if you have what it takes to provide it?

The TA provides the ultimate in customer-focused service. It means viewing customers as individuals with concerns, goals, and solvable problems--not as the next sale to close on the way to achieving a sales goal. Above all, it requires probing questions, active listening, and recommending solutions that are best for the client, not the bank.

Any service provider can play the role of TA, but the potential benefits rise dramatically in fields where competition is fierce and products are becoming a commodity. Banker TAs stand out among other financial service providers--in both good and less-than-favorable economic times--to be rewarded with a flow of referrals from satisfied customers.

A Quick Checklist

The successful TA has five characteristics. The following checklist can help an institution learn how its TAs stack up.

1. A plan versus winging it. Trusted advisors know that improvisation is good for comedy but not for building trust with potential clients. So they develop a plan that is used as a framework for every customer interaction. They plan what will happen, why and how it will happen, solutions they can present, and the next step in the process. By practicing their plans, TAs internalize the processes they have laid out, allowing them to focus entirely on active listening. In addition, they develop the flexibility to adjust the processes as customer interactions progress. The result is a smoothly flowing, customized, in-depth conversation that builds trust with the customer.

2. Keeping it simple. Trusted advisors have skills, knowledge, and competencies relative to the entire spectrum of financial services. They also realize most customers don't have the same depth of understanding. That's why the ability to keep it simple is so important. The most successful TAs give customers the information they need without drowning them in detail or, worse yet, talking down to them.

3. Asking good questions. TAs don't limit conversations with customers to details on a single transaction. They delve deeper. They ask questions that uncover individual, family, and financial goals to get a broad picture of the client's overall needs and desires.

With this information in hand, TAs create solutions based on the customer's needs. The solution that is right for the customer depends on the customer's goals and investment portfolio. And a TA can't suggest the proper solution without asking the right questions.

One of the best ways to develop this skill is by finding a mentor, a fellow banker whose behavior is worthy of emulating. By sitting in on calls, understanding the questions being asked, and internalizing the experiences they observe, TAs-in-training will learn to relate the same way to their customers.

4. Listening. The worst thing a banker can do is continue asking questions without stopping to listen to entire answers, which is the only way to learn more about the customer. Honesty is a must. And questions cannot be asked from a mental checklist; focusing on the next question means less than 100% focus on the customer--and it will show.

Listening fully to answers is perhaps the biggest challenge bankers face in their quest to become TAs. Development of this skill will be aided by asking good questions. Finding a solution to maximize an investment or purchase based on a client's long-term financial goals requires far more concentration during a conversation than simply matching a product with a need.

5. Thoroughness. Thoroughness results from developing "deep and wide" relationships with customers. TAs know their clients well enough to be able to identify, in advance, everything the client will need to complete the purchase of a product or service. They ask good questions and listen carefully to the client's answers. Then, when presenting a lending solution, the TA supports the recommendation with a complete list of everything the customer needs to provide before the transaction can be processed.

In addition to--or perhaps because of--these five characteristics, customers find it easy to relate to professionals who fulfill the role of a trusted advisor. Bankers who succeed in providing this premium level of service identify with customers through the use of thoughtful, relevant stories and examples. And the stories follow a familiar, proven formula. They introduce the satisfied client's situation and needs, explain the TA's solution, and present the end result. By developing a ready supply of well-rehearsed examples, the TA demonstrates his or her comprehension of the customer's concerns and ability to provide appropriate solutions.