Becoming an Irreplaceable Wholesaler with Penny Phillips

Your advisor clients and prospects are deluged with information.

Worse, it is information that often they can find online, unaided.

So how exactly are you going to become irreplaceable?

Penny Phillips has spent most of her career coaching and consulting financial advisors and institutions. She is the co-founder and President of Journey Strategic Wealth, a Registered Investment Adviser built for advisors seeking independence and hands-on practice management support.

Prior to founding Journey, Penny founded Thrivos Consulting, a practice management coaching company. She has worked in various leadership positions across the financial services industry and has authored multiple practice management training programs focused on helping financial advisors prepare for the next generation of wealth holder.

As an industry speaker and sought-after facilitator, she has spoken at financial services conferences across the US and Canada. She is a monthly contributor to Wealthmanagement.com and runs an advisor practice management community called The Study Group.

Penny was nominated for Thought Leader of the Year at the 2021 Wealth Management Industry Awards, and Innovator of the Year in 2022.

On a personal note, Penny is certified in Advanced Behavioral Analysis. She earned dual degrees in Economics and Corporate Finance from The Macaulay Honors College of New York. She was was born and raised in New York City, is of Greek descent and speaks fluent Greek.

Originally Recorded March 2018

The financial services industry is in the midst of great change and uncertainty.

As a result, advisor-business owners are faced with managing a unique set of challenges.

A changing client demographic

Approximately 30 trillion in assets will shift from a Silent Generation/Baby Boomer client to a female spouse and millennial heir over the next several decades. The majority of female spouses and millennials will leave their husbands’ or parents’ advisors at the moment of wealth transition. Advisors have a tremendous opportunity to capitalize off of this wealth shift, however most are unprepared to do so.

The future holder of wealth looks different than the traditional holder of wealth of the past; they think differently about their money, they seek advice differently, and they interact differently with advisors. Advisors must do a better job of connecting with the new wealth holder by building a team and structure that is more conducive to the way this future client thinks and acts.

Fee Compression

Advancements in artificial intelligence and technology prove that it is only a matter of time before digital providers begin to introduce “advisor-bots” that have the ability to emotionally interact with clients. Technology has commoditized virtually every aspect of the wealth management spectrum, causing fee and price compression like the industry has never seen before. Advisors have had to come up with new ways to generate revenue. Further, all sales professionals have had to redefine and clarify their own value and on a deeper level, they have been forced to face their own fears surrounding their worth in a new age of advice. 

Achieving operational efficiency

For many reasons – regulatory change, a shift from product to service to advice – it is becoming increasingly expensive/unprofitable to “run the business” the way its traditionally been run.  The successful advisors of the future will have learned to achieve operational efficiency by centralizing/outsourcing, pooling resources, and embracing new growth models.  Also, they will have learned to create capacity and scale in a way that contributes to the sustainability of the business. In other words: generate revenue from somewhere or someone other than them.

How can you help?

There is nothing you can tell advisors about a product that they can’t find out on their own. Our industry is over saturated with information.

In order to be of true value to an advisor today you must partner with them to turn industry challenge and change into opportunity that will ultimately impact their bottom line.

Help them strategically manage change.

Position yourself as partner

Be direct and tell them that you are committed to supporting them in a deeper way moving forward. Acknowledge the change that is occurring in the industry and how it is impacting folks in your profession.

Co-create a plan with them to achieve  (or at least) seriously address three strategic objectives this year relating to business growth and sustainability. Commit to serving as their accountability partner and consultant as they strive to achieve them. Set up one call a month for this purpose.

Add REAL value

Get deeper with them as it relates to practice management. Don’t just focus on the “surface” problems and solutions (asking for more referrals, prospecting, using LinkedIn). Help them be more strategic in order to grow:

• What initiatives are they focused on to help connect with the next gen client, or a different demographic or market segment of client? How are they utilizing team members, technology, or social media for this?

• How can they evolve their business model so that they have a wider range of service offerings or service packages to clients? How are they maintaining an offensive position against continued price compression in investment management?

• What is their plan for producing new or additional lines of revenue using either technology or other members of the team?

• How are they strategically hiring to ensure that other members of the team impact the bottom line by generating revenue?

Brush up your emotional intelligence skills 

Arguably, this is the most important point. 

Try this: commit to asking only open-ended, thought-evoking questions for the next ten meetings you have. Don’t ask “yes” or “no” questions. Ask only “what” or “how” questions.  Don’t ask any leading questions either. Truly practice the act of listening to the advisor for the sake of listening…and learning.

In an age of advancing technology and digital tools, the humans who will survive – and thrive – as sales people moving forward are those that possess the very highest levels of emotional intelligence.

Written by Penny Phillips