Everyone is answerable to someone. As an advisor you are answerable to higher ups in the firm (your manager) and clients. Both can fire you. Clients can leave, sue or lodge a complaint. Managers can dismiss you or change your role considerably. You want clients and managers as allies, not adversaries.
How to Get Fired by Clients
Clients don’t exactly fire you. They leave. Unlike work, there’s no probationary period.
1. Forget about them. It’s often been said the major reasons clients leave is lack of communication. They don’t hear from you, so they assume you don’t care.
Instead: Communicate regularly. You have tools to make this easy.
2. Don’t deliver. Clients can invest on their own. They choose to work with a professional because they think they will do better, justifying the extra cost. Sometimes, making money is not an option. In other circumstances, they don’t want to hear the market indices made great moves, yet they lagged far behind. You’ve seen those “Worst performing funds of 2020” reports online.
Instead: Set expectations, especially in volatile market conditions.
3. Be dismissive. You don’t ignore them, but you remind them they are a small account. You only keep handling it as a favor. Setting expectations, you explain they shouldn’t be expecting much attention. You have made them feel insignificant.
Instead: Everyone should feel like they are an important client.
4. Mislead on fees. Clients know you don’t work for free. Years ago, there was a mindset “It’s vulgar to talk about money.” Clients want to know. This is especially true with hidden fees. They will feel they have been deceived. This can lead to a formal complaint.
Instead: Go above and beyond to be transparent.
5. Don’t provide guidance. Your job title includes the word “advisor.” Clients expect advice and guidance, particularly when markets are volatile. If you don’t, they will question why they are paying higher fees and move elsewhere.
Instead: Offer qualified opinions based on certain things happening.
6. It’s my way or the highway. You want total control over the relationship. You tell clients to follow your instructions or you won’t work with them. Few people like this kind of arrangement. They have many alternatives. The highway starts looking better.
Instead: Build trust and confidence. You will still explain, but they should be agreeable.
How to Get Fired by the Firm
The firm looks out for both it’s own interests and those of clients. As an agent of the firm, the last thing they want is someone going “rogue” as they say in TV spy dramas.
1. Sign someone else’s name. It seems like such a small step. They might even give you verbal permission. “I sign my husband’s name all the time – go ahead.” This is forgery. It’s on file with the firm forever. The client likely gets a copy too. If they want to dispute something, they can truthfully claim “I never signed this document.”
Instead: Say no. Get people on the phone.
2. Placing orders without client consent. There are certain situations when it’s permitted. Those are discretionary accounts. Lots of paperwork is involved. If it isn’t on file, you can’t do it.
Instead: If they aren’t reachable or don’t want to be involved, talk about indexes or introduce them to managed money.
3. Inappropriate behavior. What was once borderline is now in the Zero Tolerance zone. This is especially true when one party is subordinate in the organizational structure to the other. Zero tolerance eliminates and discussions about varying shades of grey.
Instead: Think of the consequences. Imagine explaining your actions to your spouse or family.
4. Don’t prospect. There’s no Compliance red flag. You are just not bringing in the numbers. It’s costing the firm more to keep you than you are bringing through the door. With newer advisors, the signs are pretty clear, pretty early who will make it and who won’t. Clients might not learn the lesson to “cut your losses early” but firms are pretty good at it.
Instead: If this role isn’t for you, consider others in the firm. Large teams often have many roles. Your firm might have a bank advisor side.
5. Lie. I never said that. You can see how this fits between client complaint and legal action. You need to assume the firm is great at archiving e-mails, records, client contact notations and phone calls. There’s a reason you hear “This call may be recorded for training and other purposes.” If you lie, you put the firm at risk. You have gone rogue.
Instead: Always tell the truth.
6. Don’t come to work. Your book might all be on a fee based system, but clients still expect you to be there. If you aren’t, the work falls on the sales support team or other licensed people who can take orders. The firm might have other plans for you.
Instead: If you are an experienced advisor, consider the firm’s retirement packages, allowing you to gradually transition out of the advisor role.
Except in legal situations, the firm has other ways of dealing with situations. They can demote you from Financial Advisor status to Investment Associate. It’s a position between sales support and advisor. They can bring you into a team or build one around you. Suddenly your accounts belong to several advisors who have contact with the client.