Four steps to help build a client-centric team

Since 1998, Russell has offered practice management guidance designed to help financial advisors build better businesses. One of our key insights has been that high-performing teams have a strong client-centric philosophy that is reflected throughout their segmentation, service models, workflow processes and team composition, which ultimately leads to successful business growth.. Below is an outline of the four steps that we believe are necessary to build a client-centric organization and maximize your team's effectiveness.

1. Establish strategic segmentation
In order to build an effective client-centric organization, the first step is to identify the unique client factors that drive segmentation. The book must be strategically segmented with two key factors in mind:
1. Which client groups have distinctive attributes that collectively provide a unique view on value? For example, 60-year old clients working in the medical field will likely have a different perspective on “value” than 40-year old clients working in technology. Such discrepancies in clients’ perception of value should encourage advisors to segment their client base into groups that will have different service models reflecting the group’s preferences.
2. How do the clients impact business profitability? The 80/20 rule– which suggests that 80% of the effects come from 20% of the causes – applies in advisory books, too: a majority of profit/revenue tends to come from a small number of clients. In order to effectively segment their book, an advisor must be mindful of the revenue the client is currently generating for the business – as well as the future revenue opportunity that client represents. For example, a 40-year old client and a 60-year old may both generate $6,000 in revenue today, but they will likely have very different revenue projections for the business in 10 years’ time given a number of factors including, but not limited to, accumulation versus decumulation of assets.

2. Create sustainable service models aligned with each segment

A second possible step to help create a client-centric organization is to design sustainable service models that align with each respective segment. Translating segmentation efforts into a proactive service model that not only aligns with the unique characteristics of each segment – but also is efficient and scalable to deliver – requires concerted effort and on-going diligence on the entire team’s part. For example, knowing that you have a unique client segment of 55-64  year old engineers from the same company with average revenue to your firm of $10,000 is good insight, but if the service model doesn't reflect the unique characteristics of the segment – such as a goals-based planning that emphasizes deep knowledge of the stock options plan within their company – an opportunity to deeply connect with the client has been missed.

3. Design dynamic workflow to help sustain the segmentation and service models

The transformative power of the client segmentation and service model creation efforts are only as good as the workflow that supports their on-going seamless coordination and maintenance. So it’s critical to design internal workflows that ensure that the business can adhere to the segmentation model and continuously make good on the promises of the service model. In addition, these workflows should be created with an eye toward agility: client needs and conditions change constantly, so the workflows need to be able to adapt accordingly.

4. Team optimization through role clarity

Formally documenting the workflow in an “operations manual” can provide transparency into the business’ resource requirements and reinforces the business’ focus on the key client segments and their corresponding service models. This documentation process can also provide important role clarity for team members by identifying which tasks need to be accomplished and to whom they are assigned. With clearly defined responsibilities, each team member is in a position to achieve mastery – and is also empowered to potentially expand their impact into greater client-centric value.