3rd February, 2017
As a trusted advisor you may find yourself helping your client in areas other than your field of expertise. How you deal with that situation could make or break your reputation.
By recognising the need for your client to connect with another professional – and then connecting them with the appropriate expertise – you can retain and strengthen your role as a central advisor.
The important thing is to know when to use others’ expertise and how it can help deliver your client value that you can’t promise.
However, many advisors don’t consider referring a client to another party for a variety of reasons – and that harms both the client and the advisor in the long run.
These reasons include:
This is like parents thinking they know how a school should run because they spent a lot of time there when they were kids.
Don’t make the mistake of thinking you know all about business because everyone is different.
Remedy: As an experienced professional, you know each client has different challenges, and their experience won’t be the same as yours. Keep this in mind and assume nothing.
You will enhance your reputation as a trusted adviser by the company you keep. Unless you have built relationships and a deep understanding of how other professionals can help your clients, it will be hard to refer them to the best people.
Remedy: Network – and keep in mind the purpose of this networking is not to sell your services or to get referrals. A pile of business cards from the latest business networking function is not a network. It’s about identifying the people you’d like to work with to deliver to your clients the advice they need.
What if you send your client to another professional and they receive advice you think is wrong?
Remedy: Do your research! Take the time to get to know potential advice partners, their services and how they work with clients. Don’t be afraid to walk away from a poor match – remember you are doing this research on behalf of your clients.
So when would you need to refer a client to another party?
When they need proactive strategies to minimise tax
While you understand and can advise on ways to minimise tax, your client may need to be referred to other professionals as part of the implementation of strategies.
When clients need to seek legal advice
Help the client recognise when the stakes are high and a situation or concern calls for legal advice from a professional. Then provide recommendations of lawyers with the right expertise to help them.
When they need a business coach or strategic partner
Your knowledge of a client’s financial situation gives you a unique insight into any areas where they may lack specific skills, such as business planning or marketing.
When they need financial planning advice
As you know, there are limitations on the advice you can give if you do not have the legal right to do so.
Your clients will value a referral to a professional, independent financial planner when they need to manage their superannuation, life insurance and related affairs.
When they need to prepare for succession, retirement, or sale of a business
Many consultants specialise in these areas but lack the financial expertise you can offer.
When you identify the need for these next steps in a business, it’s time to call on the professionals in your network who can fill in the gaps such as people management, business broking and legal.
Your clients trust you for your values and ethics, and they will get the best results with other advisers who also share those values.
Focus on finding the best possible source of advice for your clients, and you will minimise any risk in referring them outside your business.
Your good advice — in sending them someone who works with them as well as you do — will be rewarded by strengthening your position as an adviser who gives their clients the advice they’ve been waiting to hear.