Lines of communication

Recent announcements by several major institutions indicate that the appetite of the past several years’ for acquisition, merger and consolidation is set to continue unabated in 2008. And while we’ve no doubt that such initiatives are always in the best interests of the shareholders, feedback from our CATScan* client satisfaction survey would suggest that the process could be handled a little more effectively (even sensitively) from the client’s perspective.

As the following table indicates, out of the nine key performance areas covered by CATScan, communication ranks relatively poorly. And it’s not only the ratings that suggest improvement is very much needed – clearly from the written comments clients make, they are expecting to receive more meaningful information about their adviser and his/her practice, communicated to them in a timely, proactive fashion. Before we drill down a little further into the elements of meaningfulness and timeliness, it’s important to appreciate the golden rule of client services: the client’s perception is your reality!

At the end of the day, it’s what the client thinks that’s important; professional relationships are developed and maintained on trust. Your technical expertise is expected and, in our view, is the “ticket to the game”. Turning first to what is meaningful to the client. As they have entrusted their financial well being to you and your practice it’s clear they have confidence in your technical ability and expertise. Otherwise they wouldn’t be your client, right?

So they certainly expect you to communicate issues that affect their financial plan – changes to regulation, the investment market and so on. But CATScan feedback also tells us that, as their trusted adviser, they’re looking for continual reassurance of the relationship they have with you. Consequently, they’re interested in being kept informed as to what else is happening within their adviser’s business – if changes are occurring, what’s the reason for them? Should they (the client) be concerned, for example?

The sale of a practice, or merger of one practice with another, is a key trigger we’ve noted for negative client feedback. Even something as simple as a change of name (without any change whatsoever to the practice itself ) can still create bad vibes, while a change in personnel (especially a key client relationship person) can certainly set off alarm bells in the client’s mind.

As to the issue of timeliness, it will be common sense to all of us that the client should be told of any change before it happens. There is nothing worse for a client than to ring their adviser’s office and be informed that there has been a change of company name or, worse still, that their favourite client service person has left the practice!

Yet it is not uncommon for a CATScan report to contain a number of such comments. With modern technology, surely it isn’t too difficult to send an email advising of a change – it’s quick, efficient and cost-effective. And with over 80 per cent of clients utilising the internet, email has fast become an acceptable form of communication for most. Further, why wouldn’t you place a change communication on your website for all to see?

Finally, your very best (“A” class) clients warrant a phone call, if not from their adviser directly, then at least from the practice, advising of a change. What a great opportunity to further build on the relationship! By communicating in a timely (proactive) fashion, you should be able to turn any potentially negative situation into a positive. And, as the following table indicates, the more points of client contact, the better!

As we all well know, apart from death and taxes, the only other thing of reasonable certainty in life is change – clients expect it. But they also expect their adviser will communicate it in a meaningful and timely manner.