The ClientWise Blog

Best Practice?

Posted by Chris Holman on Sep 21, 2010 5:16:00 PM


According to Wikipedia, a “best practice” is… “a technique, method, process, activity, incentive, or reward which conventional wisdom regards as more effective at delivering a particular outcome than any other technique, method, process, etc. when applied to a particular condition or circumstance.” (If it’s in Wikipedia, it must be true, right?)

In the world of the financial advisor, “best practices” abound. Or do they?

In the definition above, the key phrase is “conventional wisdom regards…” The problem with conventional wisdom is that it often isn’t. The problem with “best practices” is that just because something worked for somebody else, somewhere else, sometime else…doesn’t mean that it will work for you.

However, by sticking the “best practice” tag on a technique/process/method ….it seems to immunize that particular technique/process/method against critical and discerning thought as applied to one’s own world.

For more discussion on the risk of blindly following “best practices,” I encourage you to read this essay by Tim Berry, “The Sad Truth About Best Practices.” It’s quite good.

At the same time, we can all learn from the best. There’s no point getting older, if we don’t get smarter.

I guess the key point here is to use some balance. “Best practices” can offer some good learning if we take the time to employ some critical thinking as to how these techniques/processes/methods might apply to our own circumstance. Here's a question for you: Are you utilizing any types of “best practices” in your business model today? If not, you may want to examine some and determine if they could yield some benefits for you.

Speaking of a technique/process/method that may or may not be a “best practice”, I’d like to share a brief story with you.

I was in Nordstrom’s the other day…purchasing the right tie for an upcoming occasion. At the counter, as I was completing the transaction, I noticed a list that was labeled, “Best Customer List”. Names… Addresses….Phone numbers….the whole works…in full view for anyone to see. Very indiscreet…a real faux pas by some injudicious Nordstrom employee.

However, this incident got me to thinking. I can imagine how most merchants of luxury items e.g. high-end retailers, luxury car dealers, jewelers, wine merchants, etc. must segment their clients into “Best Client Lists.” I would also think that when financial advisors build strategic alliances, that they should include the other professionals who make their living by purveying luxury goods and services to the affluent. Moreover, I suspect that a savvy financial advisor might organize creative client events that would involve other purveyors of luxury items, and engage the “Best Client List” of all those involved. Could be quite fun!

Not a “best practice.” Just a thought that may, or may not, work for you.

PS…We, at ClientWise, have recently done some research around best practices and developed a benchmarking tool that gives financial advisors the opportunity to benchmark their practice versus top advisors from across the country. By measuring yourself against your peers, you can learn what areas of your practice fall into the “best practices” model, and which areas may need some improvement.

We will be hosting a complimentary webinar on October 13 to discuss some of our research findings and explain how our Benchmark Assessment Report (BAR™) can help you reshape how you manage your practice. For more information, call Liz Walsh at (914) 244-1545, ext. 301.

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Topics: Business Development