The blueprint for the successful advice firm of the future #1 – Transcript

Fraser Jack
Welcome to the podcast, Shan.

Shan Chung
Thank you for having me.

Fraser Jack
It’s fantastic to have you along. I’m really looking forward to this podcast, some incredibly amazing content I’ve had, I’ve had a sneak peak to go through. So I’m looking forward to getting into that. But before we do that, tell us a little bit about you.

Shan Chung
Sure, sure. So I’m Shan Chung. Been at Macquarie Bank for about 15 years, always connected to the advice industry, so quite passionate about advice. And for the last 10 years has been with the virtual advisor network, and in that role in working with advisory firms, so that includes accounting and financial planning, ranging in size from 1 million revenue to 50 million revenue and seem a lot of them grow through that that range, which has been really interesting. And my role has been to help them formulate, and then execute strategy and succeeding where they want to go. And then the other part has been the community side. So bringing them together to share ideas at conferences, and roundtables and so on.

Fraser Jack
Yes, exactly. Right. And all the ideas and concepts that you would have seen over the time would be, I think, are going to be invaluable to the listeners listening to this. So thank you so much for coming along. And being prepared to talk about that. Tell us a little bit about the successful advice framework itself, within the Macquarie virtual advisor network.

Shan Chung
Yeah, sure. So over that 10 years that we’ve been operating, then we thought, Look, we’ve seen a lot of what actually works and doesn’t work. We’ve also condensed and, and tailored a lot of good business practices for advisory firms of that size. So we thought it was a good time to start to package that up in a framework that an advice practice could really practically use in their business and think about their business, you know, to think about their business. So we’ve combined you know, leading global practices, tailor them to businesses of this size. And, and also some of those real world insights, as I mentioned, and one of the reasons we did that is we found that, you know, advisors go through a growth stage from from being a great advisor to becoming a business lead owner and business owner, which is a different skill set. So this is a way of of equipping them with that transition.

Fraser Jack
Yeah, amazing. I love I love the concept of taking all that wisdom and knowledge in those amazing practices that are included in there, and then turning that into a framework. And, you know, when when you present this framework as such, which is obviously, you know, got some structure behind it, you sort of broken up into pillars, I think main four main pillars. Tell us about those four pillars.

Shan Chung
Yeah, so this is just a way to structure it up, as you mentioned, they’re not rocket science. But the four pillars are number one is strategy. So making better decisions and then executing well. second pillar is clients having a strong differentiated proposition. The third pillar is scale and growth, having a great operating model. And the fourth one is people and culture. So you could apply those four pillars to any business. Really, that’s just a good way to group up the topics. And we start with strategy, you know, because you want to know where you’re going before you shape those other other parts.

Fraser Jack
Yeah, those those pillars? Certainly, obviously, we’re talking about advice businesses, but they certainly make sense in any business across any industry almost. Yeah, that’s right. And that’s it. Now, today, we’re really focusing. And we’re going to go a little bit deeper into pillar one and pillar two, which is which I’m really looking forward to split that with pillar one. We talked about, you know, making better decisions and successfully and those sorts of things. Tell tell us about pillar one.

Shan Chung
Sure, sure. So killer one is all about strategy. Perhaps the best way just to to illuminate this upfront is to give you a comparison. So I’ve worked with two businesses 10 years ago, and they were both around that mid one mil mark. So 1.3 to two mil revenue. 10 years later, one of those businesses was still at about 1.3 mil Rev. And the other business was at 20 million Rev. So you know, it just fascinates me. What What was that second business doing differently? Now, there’s a bit of a proviso here, while bigger can be better. I’m not saying that every business should be just growing for the sake of growth, or that, you know, the revenue numbers, the be all and end all that’s not the case. But that smaller business had a lot of frustrations, right? They were having their non standard processes, that difficulty with staff turnover, they weren’t really making the progress they were hoping for. And that fascinated me, you know, what were the decisions and the disciplines that that larger business were making, to achieve that and break through all those gross feelings over time. So it’s those kinds of that, that thinking that makes that difference that sits behind this pillar? And so, you know, what does that actually look like? Well, that, you know, you hear that phrase work working on your business working versus working in your business. So it’s that on the business thing, and it’s painting a picture of where you’re going so what what is that? What does that business look like in five years? 10 years, but really importantly, the less obvious part is how do you connect it to your own personal appetite for for growth? For taking risk to get that growth and for control over your business because for, you know, one principle to the next principle that will change and not the same vision shouldn’t apply to every business owner. So it’s, you know, marrying up your personal goals with with your business goals.

Fraser Jack
Yeah, that’s a really that’s a really very interesting point, isn’t it? Because we know that our personal goals will often lead and dictate our behaviors. And so if they’re aligned in the behaviors that the will be in the business will be the same as the the behaviors at home. I love this concept. And having that clear vision around where you’re heading, I think it’s great. From a practical point of view, though, what can what can the advisors listen to this podcast in a takeaway as and what are the do’s and don’ts that they should be focusing on to to really double down on that?

Shan Chung
Yeah, sure. So look, if I was in business, if I had a business partner, or several, I would be ensuring that we are all on the same page about where we’re going. So taking time out, if you haven’t done this already, share your personal goals and your business goals. But you know, what’s driving you what, what’s impacting your thinking over the next few years? What is your appetite for growth, risk, and controller? Are you all aligned on that are the differences that will require some compromise and understanding and that that openness and understanding of each other is kind of the foundational bedrock of everything that comes afterwards, right, because if there’s anything not quite aligned or understood there, and then you progress with a certain strategy, it may unravel as you realize that your priorities aren’t deeply aligned, you know, so start with that, if you if you’re a sole business owner, just take that time to reflect if you have trusted is or advisors or, or staff members. Just think deeply about that. What is your appetite, the environment right now in the device industry is such that if you’ve got a big appetite for growth, now’s your time, right? So you’re going as big as you can, or as big as you possibly could. You know, and likewise, that that disruption is changing the landscape for everyone. So if you if you would rather have a low sense of control, and sort of work less well, then maybe you can join another larger firm and become part of something bigger, you know, hand over some of that control, and go for a good lifestyle. So, you know, there’s certainly different options there. So long as you’re clear on what you want.

Fraser Jack
Yeah, having that, like you said, having a clear vision in places is pretty important. And as you mentioned, there to communicate it because I think I feel like so often there can just be assumptions made like one business partner just assumes that the other business partner, you know, thinks or feels the same way.

Shan Chung
Spot on. Yeah. And, and I’ve seen situations where that’s come apart, 10 years down the track. And yeah, you can imagine the difficulties involved there,

Fraser Jack
we can absolutely imagine that now, tell us a little bit about there. If we chunk down from vision, let’s get into a little bit more of the, you know, having an action plan in place as well, because I guess it’s great to have vision. But then I guess the next step is to start with an action plan

Shan Chung
you’re spot on. So what we recommend business leaders do is apply and management system, which is a very exotic, you know, name, the the management system developed by Kaplan and Norton, if for those that are curious to read more, theirs is tailored for a large corporation. So what we recommend is simplify it down. But essentially, this is what it looks like, you know, over a 12 month period, what’s your rhythm and system for working on your business? And what that shouldn’t really look like is you start with a strategic view. So what’s happening externally and internally in the environment? And in our business? Where do we want to take this business? And let’s refresh that, right? Let’s be clear on where we’re going, and what success would look like. And then there’s a 12 month rhythm of executing to that. So prioritizing what you’re going to work on tracking your progress to that actually doing the work. And then 12 months later, you should revisit, you know, and so it’s a regular discipline, almost like a drumbeat of, of continual working on the business. And that avoids that kind of are we did a strategy day three years ago, and we’ve got a document in the bottom drawer, and you should probably take it out again, right? It should always be front of mind, not only where you’re going, but the measurements along the way, and how you’re tracking.

Fraser Jack
Yeah, that’s really important. You know, having like, like you mentioned that disciplined system in place. I really liked that. And like, like I said, not just having the document in the bottom drawer, but having a system in place where you’re constantly looking at it and becomes part of the Bau. But if we if we chunk down a little bit further as well, what’s the practicalities that advisors can start thinking about? What from the actions that they need to take to create this discipline system?

Shan Chung
Sure. So first of all, it sounds obvious put it in the diary and commit to it so that when things get busy, which they always are, that’s sacred, you know, so the firm’s I’ve seen do this the best. This is just part of what they do and they never miss it. Right. And it’s they take it very seriously. They do the pre work. leading up to it. And so just do it really is that is the first practicality. There’s another one is, look, we’ve talked about vision and strategy. And that all can be a bit fuzzy. So to make it clear, there’s a good framework called the playing to win framework from Roger Martin, there’s, there’s hundreds of these frameworks, but that’s a good one. And what that gives you is a bit of structure around what that actually looks like. So when we say our strategy, what do we actually mean? Well, it’s like, you know, which, which market are we in? Which kinds of clients? are we competing for? Or serving? And how are we actually going to attract those clients better than the next firm? Or the average firm? And then how will we know we’ve done it? What does success look like? You know, so that’s where a framework like that can help you get specific, rather than just theoretical about your strategy?

Fraser Jack
Yeah, it gets specific into the actions that are required, and who’s going to do what and who’s responsible? And now I guess, if we if we look at that from, you know, tracking point of view and looking at key results, and I want to ask you about the the OKRs objectives and key results framework as well and, and how advisors can use these things to prioritize what they should be doing first.

Shan Chung
Sure, sure. So yeah. Okay, as many of many of you’re listening now would be using those. John Doerr de Davila wrote the book on this. It’s just a very practical system objectives and key results. So what I would suggest is, once you’ve developed the strategy, lay out what the key results are. So what how are you know, you’ve you’ve succeeded on the way there on a quarterly basis? You know, is it numbers of new clients? Is it client satisfaction scores is it, you know, time to produce an SOA, whatever it is documented, and make sure that people and I know who’s accountable for what, and in terms of prioritization, you know, this is probably one of the biggest bang for buck things a business owner can do is, is just simplify their priorities. You know, I’ve I’ve seen, I did ask a business once for their for their list of current projects, and I got a spreadsheet with 72 projects on it. So I think ideally, a business, you know, between 500k and, and 5 million revenue, should have, say, two headline initiatives, strategic initiatives, give or take one one’s better threes, okay. And that’s what everyone’s rallying towards, you know, and we want to see a return on investment on those projects, you want to see the value delivered to the clients or to the business or to the staff order, not eight projects, right? Because whoever’s working on project number eight is probably better off contributing to project number one, right? Just don’t project eight now. And so the real example of this was we ran a workshop, we talked about this concept, and it was music to my ears, because one of the firm’s afterward said, we’ve we just cancelled our client seminars, we like doing that clients seem to like them. But that was priority number number 10. So we’re going to use that time to embed an acquisition we’ve just made. And that’s, that’s brilliant. That’s what you know. So make things simpler for yourself, try to get a return on those top two before you expand it to the new ones. Easier said than done. But

Fraser Jack
I really do. Absolutely right, I really do think that people will sort of skip that prioritization stage. And, and it’s such an important part of the of the puzzle. So we were talking about that. And once we’ve worked out through that prioritization process, what should you know, people be thinking about when, when trying to execute this and put everything in place?

Shan Chung
Yeah, sure. Sure. So actually, if I can backtrack a bit further this year, those looking for practical tools, because I’ll just mention a few tools throughout this chapter. So that if people want, you know, a practical take, they can. So there’s something called the importance difficulty matrix, very simple prioritization tool, especially if you’re working in a group. So if you just Google the importance difficulty matrix, just a nice way to to rank your priorities based on the value they’ll deliver to your business? And how hard they are to actually to execute? Yeah. Yeah. So once you’ve got the priorities, how do you get started? Funnily enough, I think the big one here for business owners is engaging their people. So there’s two disciplines here, project and change management. And they’re kind of you could think of them as the mechanical and the people science of implementing strategy. So I’d recommend just look up, how you can be a good sponsor of change in a business, learn the fundamentals, and it’s all about engaging in people bring them along the way so because they’ll often be the ones that actually do the work and do the execution. So as the business leader, you want to be flying the flag and helping them and encouraging them clearing obstacles, making the investment that they need to be motivated and aligned with you as to why they’re doing what they’re doing. So look that up. There’s an outfit called Pro site PR SCI who have a lot of free resources online. On leading change. So that’s that’s how I recommend executing is becoming a great sponsor.

Fraser Jack
That’s great. That’s great advice. Yeah, you’re absolutely right, you know, begins with the staff and the in the people involved and, and the attitudes towards those things. So I think it’s great to have some framework and concept around that, that’s, that’s a really important part once you’ve once you’ve worked out the prioritization, so thanks for that chance, if I was to sort of sum up, pillar one on, you know, taking notes along the way, it’s, obviously have a strategy, you know, make a plan, based on the key results that you need, you know, prioritize it, understand what you measure success are, and, and then understanding what those action items required. might be, and then, of course, execute the actions required and bring people along the way and, you know, measure the data and, and tweak along the way. How important is tracking to, you know, tweaking the data and tracking in this process?

Shan Chung
Yeah, it’s, you know, what’s, what’s that? What’s that slogan, you know, if you, you know, measure what matters. So, what I’d recommend is having a scorecard, if you can have it on one page, that’s even better. And I’ve seen $30 million businesses have their scorecard on one page, right. So if anyone’s looking for a version of that, there’s a Vern Harnish, who wrote scaling up, if you Google the scaling up one page plan, what that gives you something to track to so all your financial metrics, your goals, your values, your OKRs, all in one place, so that every quarter or whatever period, you decide, you can bring it up, and you’re updating those measures and checking along the way. And this is where to be perfectly frank, strategic execution gets boring, right? It’s not exciting to do that. And this is where it is actually a discipline. So it’s one of those things you just have to do. And if if it doesn’t get done for a while, it’s one of those things which the wheels might fall off straightaway. But you can veer off course, and find yourself a year later you you’re on the wrong priorities. So you’re not sure whether you’re making the right progress. So look it in the diary, try to prioritize it, I can tell you, those, those businesses that we’ve seen grow most rapidly and get success, have that in place, you know, and they adjust course, as they as they go along.

Fraser Jack
Yeah, really, really important. So Shan, thank you for that. So there’s a lot more to strategy than meets the eye. But it’s great to have an inside that pillar, Rob strategy, that you’ve got so many different areas to cover, and in such a great order to so thank you for sharing that. Let’s talk about pillar two. Now we’re sort of getting sort of focused here on the client experience or a bit more around the client in the in the offering. And I guess we hear, we hear that all the time. Right, you know, having a strong value proposition, you know, is really important. But tell us a little bit more around this client experience and value proposition?

Shan Chung
Yeah. Okay. So you do hear it a lot. And it is important. But one thing I’ve I’ve learned, we do a lot of surveys of clients. So for, for our advice, businesses that we work with, we survey their clients, you know what, most advisors are doing an awesome job in the eyes of their clients. So when we say have a good client value proposition, I don’t think really, there’s anything broken, that’s that needs fixing, in terms of what advisors are doing for clients. But if you were to think of it to take it to the next level, right? So to go from a good advice proposition to a great one, where it should start is who’s actually four. So here’s your client value proposition for it, is that specific enough. Because the more specific and clear you are on that, the more impactful your value deliver, can become. And actually, that’ll feed through to a lot of your other business, financial metrics, as well. So that’s where I’d actually recommend starting. And then from there, there are ways that a firm can can tweak their value proposition to enhance it and raise advocacy and satisfaction, which we could touch on, if you like, but yeah, look, it’s there’s very few advisors who are doing a bad job, right that people get into this industry with a lot of passion. So it’s more about enhancing who it’s for and making it more specific than fixing something.

Fraser Jack
Yeah, fair enough. So you really want to try and chunk down on that ideal client or understanding exactly who they are. Yep, the ideal client, tell us about what firms have been doing in that in that space?

Shan Chung
Yeah, sure. So um, we use a concept called the bull’s eye ideal client. And and what we’re trying to get to there is that an ideal client, you might say, which clients do we take on? What the bull’s eye ideal client says is, if there was one client that could walk through your door tomorrow, who would that look like, you know, just one client, and that that’s your bull’s eye? You may take other clients on adjacent to that, but let’s get really clear on who that one client would be. And you know, to answer your question, what are other businesses doing on that one firm that’s had incredible success and insane Growth actually, is so specific that they target not just executives, but C suite executives that have really complicated executive share schemes in specific companies. So this advisor has learned the share schemes of certain companies so well, that he knows how they work better than a lot of the staff at those companies. And so you can imagine those executives talking to each other saying, This person absolutely just sorted it all out for me made it really clear, you have to see them, you have to go and see them, right? They even do seminars at those companies to educate the executives on their own system, if you can believe that. So that’s an example of a bullseye client, you know, there’s probably, you know, 500 to 1000 people that fall into that definition of a puzzle, ideal client. And even not every business has to get that specific. But the question that everyone should ask is, are we specific as we should be?

Fraser Jack
Yep. 100%. Now, advisors that are listening to this podcast, haven’t yet clearly defined what their ideal client is where? Where can they start?

Shan Chung
So if you think about what, you know, the different attributes of a client, you’ve got demographics, like, geography, income, age, you’ve got psychographics, you know, attitudes and beliefs, you’ve got their needs, how complex their needs, are you, you know, you’re looking at a family office. So you’re looking at a mass affluent, or something in between, and you’ve got the financial impact to your business. So what fees would there be paying? And so if you were to lay out those kinds of dimensions, and just try to pinpoint, you know, okay, we’ve got a minimum fee of $2,000, would we take a client that to pay $50,000? Probably not, because they’re going to have such complex needs that we’ll be running around doing ad hoc, you know, first time advice. So there’s probably a sweet spot in there. Maybe it’s between 7012 1000, you know, where we deliver the client the most value, we make the best profit margin, you know, and so, try to create, just consider what that band is for those different dimensions is one way to do it.

Fraser Jack
Yeah. Fantastic. And what are some of the other questions, I guess that advisors can be, you know, posed to themselves or to their staff, and then looking at their current or existing client base around, you know, who that client might be? Or who that their Bullseye client might be?

Shan Chung
Yeah, sure. So good question. So profitability is obviously an important one. So you might ask, Do we have a target profit margin in the business? So we’re targeting a 35% EBIT? Okay, what percentage of our clients? Are we making that EBIT? On? What percentage of clients deviate? You know, which, what percentage of clients? Are we making less than 15% EBIT done? And and is there a good reason for that? In other words, it’s a kind of a tail analysis. You might also ask, how many of our ideal clients are there in Australia? You know, if there’s, if there’s 10 million people that fit our ideal client, it’s probably not specific enough. Also, you know, Are we clear on which clients we say no to? And not not only am I clear on it as the business owner, but is everyone in my business clear on it? And how do we actually do that? How do I how do we say no, in a way that still takes care of that client? You know, we Are we clear on our fee schedule. Is there any discounting going on? Are you consistent with that? Do we feel like we’re doing low value work? Like I might do? I feel like I’m bogged down in work that I’m not really it’s not delivering value to me, and I’m not really delivering value to someone doing that work. So that those the question the answers to those questions can guide, you know, whether you might have a problem there, or you an opportunity to focus more,

Fraser Jack
you know, a lot a lot of advisors listening to this will be at different stages of their business, some, some people have, you know, a young new client base, that they’ve just created a business or they’re thinking about getting into business. Others will have, you know, more established businesses. And as you mentioned, that tail concept comes into it. So the idea of then finding your niche client, finding your Bullseye client, and then thinking about how that fits with the client base, and then working out, how are we going to transition this existing business into this business where we just look after our niche client?

Shan Chung
Yeah, that’s a real challenge. So if you’re starting out, you’re just trying to grow the business and get revenue and win new clients. I guess the the practical side of that is consciously have a plan to make that transition. So what is your desirable ideal client? And what’s your plan to get there? But what will you do with clients that don’t fit that profile, and start mapping it out, make it part of your quarterly strategic rhythm, so you don’t turn around in four years and find yourself with, you know, 100 clients that actually profitable and neither of you are really helping each other in terms of what those solutions actually look like? You know, you might if you’re growing rapidly You might have Junior advisors that you pass those clients onto, you might refer them on to another business who who look after those types of clients. So there, there are different ways to find that. I’ve seen an advisor whose goal is always to, to be lifting the the investable assets of his ideal client every year. And he’ll bring on associates to take the next the previous cohort. And that’s worked quite well.

Fraser Jack
Yep. So we’ve got, you know, we’ve got our our Bullseye client is that there’s a fair few questions that you’ve mentioned, that are a great starting point to be able to ask yourself, and then come up with that ideal client and, and documented it and write it down and work out who you are going to say yes or no to? Once you’ve worked that out, though, what’s the next step in the process with with pillar two?

Shan Chung
So it’s all about really understanding them and then delivering to their needs. So how well do you understand them? Now? Is it that example I mentioned earlier of the devisor, looking after executives, he really understands them, right, at least that that part of their experience. So immerse yourself in their world, you know, if it if they’re part of associations, or industry associations, or, you know, whatever it is just tried to become an expert in their world, and deeply understand their needs, but also get direct feedback from them. So whether it’s feedback, surveys, from clients, interviews, just open discussions, really start to deeply understand them. And then you can start to shape what you do around that, you know, and that’s where refreshing the value proposition kind of comes into play. Now we know who it’s for, we know what their needs are, what might be changed up with what we do to sort of resonates even better.

Fraser Jack
Yep, I feel like you were very polite, that you didn’t say, we need to find out what all the all the clients pain pains are, and the things that are keeping you awake at night, and all the emotional aspects, as well, which often planners should be thinking about, you know, when it comes to, you know, how do we best serve these particular people, we need to figure out what their what’s keeping them awake at night. So as we go, as we go through this, I’ve heard you talk about the features and benefits method can to explain that to the listeners.

Shan Chung
Oh, yeah, sure. So this is just a very simple framework comes from the land of marketing, and so on. But, you know, if you, if you were to decide, yes, we want to refresh our CVP, we’ve got a really clear articulation of who it’s for, how do you actually do that, if you map out the features of what you want to offer them, so features are what you do, or provide. And then the benefits are the benefit that the client gets from that, it’s just an easy way to provide structure around this. Right. So in that earlier example, a feature is we deeply understand the challenging share schemes that you need to take part in. And we are the best experts in Melbourne to solve that. And we also provide x y Zed, which we know that they they really love benefits to you are, you know, you’re not missing out on opportunities, you’re getting the optimal outcome, you don’t have to worry about it, you know, you can sleep easy. You mentioned the most of your, your income. And so that’s what the features benefit thing looks like. And that’s an example of one that’s quite specific to that client, you know, it’s not just, we help you with your goals, and that gives you confidence. Now that can be good. But how can you how can you refine that to make it more tailored to your ideal client? You probably need to consider as well, some some proof points. So how do we prove that that’s real? Okay, so we’ve got our features and benefits, but day to day, what are we doing that backs that up, you know, so that it’s not just a marketing spiel. So document all of that

Fraser Jack
is kind of a marketing spiel. But it’s also I think, it’s really important to and I love, I love the saying that people don’t buy your products or what you sell, they buy a better version of themselves. And that’s obviously when you talk about the you know, the benefit, and not just the financial benefit, but the emotional benefit in the around that as well. So understanding what your products what you deliver the advice you deliver, and and they benefit, the better version of the client. Love it. Love it. Let’s get practical here. How can advisors really start to get down and implement this sort of stuff.

Shan Chung
So if you’ve got your features and benefits mapped out and you want, you do want to tweak those, you know that there’s a couple of schools of thought as to how you make those changes. Agile is all the rage, you know, ever since it exploded out of Silicon Valley. Basically, it’s just testing and learning. So try things, experiment with your clients, get the feedback, see how it went and then adjust as you go. That system is really good for any project or change where the outcome is uncertain. Right? So if there’s high uncertainty, take a test and learn approach. So just try the feature. You know, when you do your features and benefits, some of them will be aspirational. You won’t have them yet. So just try it out. See if there’s value to being delivered and an iterate for projects that are a bit where there’s more certainty so say your So you’re just moving office locations, you don’t need to test in line with that, right? You just need a plan. So there’s the mistake some business leaders make is they think everything is like an office move, you know, we’ll, we’ll do the six month plan, we’ll put the budget, we’ll put each task and Bob’s your uncle. So with, especially with Klein experience stuff, you want to just get a temperature check as to how it’s going through rather than locking something in doing a huge launch. Testing, learning is just a good good way to do it, you know, not over invest

Fraser Jack
too early as it’s the it’s the, you know, the create something small, try it, ask ask a few clients for their feedback, you know, reiterate, work out where they might be, and deliver exactly what your clients are after, rather than what you think they might be after? Yeah, it’s been wonderful. Now I’m, I’m, I probably should ask you about human centered design, the methodology, too, because I think I think I like talking to you about that as well.

Shan Chung
Yeah, sure. So there’s another buzzword that came out of Silicon Valley, you can kind of think of the client experience as something slightly separate from the client value proposition. So they interlinked. So the value proposition is, all those benefits that the client gets from dealing with you. So you know, when they’re at home, sleep going to bed at night, and they feel secure and happy, because they’re, you know, they’ve got financial freedom. That’s the value proposition being delivered. How about when they walk into your office? How do they feel when they walk into your office? How do they feel when they get communications from you? How do they feel when work is in progress? And, you know, are they clear on where things are up to? So you could consider that the client experience and and a tool for that is just a client journey map, right? A lot of businesses have done this, you just map out the clients experience with you from end to end? And what are the emotional high points and low points, where’s the friction. So that’s another thing that you could add to your value proposition to increase efficacy and sort of the delight that clients have in dealing with you. And they can work in tandem? You know, the thing is, with client experiences, you want to align your efforts with what’s really important to clients. So what I mean by that is some some businesses I’ve seen bend over backwards to try and shorten their SOA production time, from six weeks to four weeks or four weeks to three weeks. Actually, clients don’t care about that, when we ask them, what they care about is knowing where it’s up to along the way. So they’d rather not be updated and have confidence over six weeks, then to hit nothing, and then have it done in four weeks. Right. So that’s just an example from surveys we’ve done in the past, you know, I’m not saying that’s the case for every single client, but make sure that what you’re putting all that effort into is actually valued by the client, and will improve their experience and best way to do that is to ask them. Yeah, exactly.

Fraser Jack
Right. And I love I love the idea of a client journey map. And, and I always think about these memorable moments as well. So sometimes a memorable moment or something great happens. He meets and the would delight, surprise and delight or delight. That was an amazing process. That’s why remember, but sometimes it could be like you just said, you know, waiting for an SOA and not being kept up to date. So sometimes that memorable moment might be a negative memorable moment that you’re trying to remove from the map.

Shan Chung
Spot on. Yeah. Yeah, no, that’s a great point, those little moments that the light can have a huge impact. I’ve heard great stories, like an advisor that comes out with more elderly clients and tests their tire pressure on their way out, or having a name card in the carpark to welcome them as they’re having, you know, little personalized touches like that can go a long way as well. Especially if they’re easy.

Fraser Jack
Incredible. Yeah, exactly. Right. Now, speaking of marketing, I’m pretty passionate about, you know, you know, marketing and, and in my head, even advisors are doing an amazing job. And they’ve got all this set up, and they’ve got their client journey map, and there’s lots of memorable moments, then then surely the next step in this process is to promote it or talk about it. Yeah. And

Shan Chung
actually, in my experience, Fraser that’s, that’s the bigger opportunity for most firms than actually refreshing their CVP. So the CVP is really important, ideal clients really important. But I found that advisors that are quite humble in nature, they want to deliver value. And so what it comes down to is, are you converting all of that advocacy that you’re generating from clients into growth for your business? In one of our surveys, we we measure what’s called the referral gap. So a lot of clients say, I’m totally delighted with my advisor, I’m highly likely to recommend them to friends and family, like nine or 10 out of 10, but I’m not doing it. I’m not referring them. Right. And so there’s a percentage of clients. I think the average is about 15% of clients, raving advocates, but they’re not actually raving advocates. So, what we recommend is you if that’s the case for you, you’ve got a latent growth opportunity in your client base. You’re already doing a wonderful job. You CVPs already proven with those clients? How are you going to convert that into growth in a way that suits your culture. And what it comes down to often is asking for referrals in some form or another. Doesn’t have to be as blunt as that. But it’s attracting new introductions, if you want to call it that. But it’s essentially it’s converting that advocacy that you’ve earned through a lot of hard work and trust into helping more clients and growing your business. And so that’s, that’s actually going a bit into the pillar three growth stuff. But you know, most most new clients come to advice businesses through referral, as everyone would, you know, listening to this podcast with no. And there’s a greater opportunity there, which most advisors aren’t tapping into. Yep,

Fraser Jack
absolutely. It’s certainly a big part of it that successful firms are doing as you would see, now, we’ve talked about that, you know, the CVP. But I guess this is not necessarily a set and forget that the sort of things will continually change over time.

Shan Chung
Yeah, just like the strategy it’s worth, it’s worth revisiting over time, you know, that the landscapes changing, there’s, there’s an increase of integrated advice, you know, so that, increasingly, businesses will get good at integrating accounting and wealth, for example. So if you offer both of those services, you will need to iterate how you integrate them, if you don’t offer them, you will need to consider how you’re competing with those businesses. And it may look like you need to cooperate more closely with with other service providers or become a central advice hub. So they’re just that’s just one example of how things will change over time. And so just like the rest of our business strategies with revisiting it from time to time,

Fraser Jack
yeah, fantastic. Thank you, Shannon. So I guess if I just quickly summarize pillar two, for my notes here, that’s obviously defining the market, understanding who you best serve, from an advisor point of view, working out exactly what you’re going to be able to offer them consistently and really weighing out the features and benefits really important mapping it out, looking at your memorable moments, obviously, putting it in place is pretty important. And as you mentioned in the previous pillar, you know, making sure that your your staff coming along the journey with you. And then of course, the part that I love about telling the world about it, the marketing part of it. And of course, you know, asking your clients to help you change over time. And you know, at that point that asking your clients, if they’re loving it to, you know, how can they bring other people in is a skill in itself. Thank you so much. I know tell us a little bit more about and obviously, thanks, you thanks to the Macquarie virtual advisor network to for sharing all these insights and creating these these pillars. How can advisors their listeners find out more about about then

Shan Chung
yeah, we would be delighted to talk to any of you listening, you can just Google Macquarie van or head to macquarie.com.au forward slash fan, or speak to your local McQuarrie BDM. Basically, we we run for businesses of up to about five or $6 million revenue, we run a program, which is 18 months in length, and is with peers in a in a group. So that might be in the same state or national group. Because we find that sharing element is really important. And then, you know, experts from Macquarie but also outside Macquarie, play a role in delivering the content. So yeah, if you’d like to know more, please get in touch. We’d love to hear from you.

Fraser Jack
Wonderful, thank you. And of course, we’ve sort of covered pillar one. And pillar two today, I’d love it if we could come back another time and cover the other two pillars, but I have to pencil that in as a as a possible thing. So hopefully, we can do that one day, I really appreciate you coming on and sharing that some, like you said 10 years worth of experiences watching these amazing firms develop. And of course, other ones that don’t develop as fast. So you know, getting the learnings from both what worked and what didn’t work. So really appreciate you sharing today. Thank you so much.

Shan Chung
Thanks for having me.

Fraser Jack
And one of the things of course, some you know, there, you know, we mentioned today in this pillar, there is a bit of a guide out there as well. Is there anything can tell us about that?

Shan Chung
Yeah, absolutely. So this pillar two, sort of domain. If you go to macquarie.com.au, forward slash client, hyphen experience, some of what we’ve talked about is kind of laid out there and a simple structure.

Fraser Jack
Yeah. You mentioned, a lot of resources today, show and really appreciate it. And we’ll we’ll put all those resources and links. So if you’re looking at this on on the XY website, you might be to find access to all those links. And yeah, thank you so much.

Shan Chung
Pleasure. Thanks, Fraser.