In the 11 years since the publication of Rob Knapp’s first book, The Supernova Advisor, a plan for increasing the returns on wealth management, financial advisors who participated in the original program came back to tell Knapp what worked and why, and contributed ideas for enhancing the plan.
Knapp’s updated program, The Supernova Multiplier incorporates the suggestions and experiences of more than a hundred FAs into seven strategies for growth.
Knapp is a former managing director of Merrill Lynch and is the founder of the Supernova Consulting Group. He says that “independent and boutique advisory firms (that) offered a more holistic level of service’’ influenced the creation of the Supernova model, the bedrock of which is timely and regular responsiveness to clients. Twenty-five years ago, Knapp says, the average FA had 650 clients, making meaningful and regular contact improbable.
The original Supernova system called for creating a financial plan attuned to the 20 percent of clientele that brings in 80 percent of income; regular and scheduled contact with clients; reducing contacts to about 100 clients per FA; robust models for referrals and new client acquisition; and leadership dedicated to service and flexibility.
Knapp defines the five critical roles of the Supernova model as directors of planning, implementation, brand management (service), marketing and leadership. Excellent responsiveness to clients starts with the director of service, who is responsible for maintaining the guide on minimum number of assets and maximum number of clients. A streamlined “book” enables FAs to respond to calls within one hour and provide a resolution within 24 hours. The service director also makes sure the 12-4-2 contact system is adhered to yearly: 12 contacts per month, four quarterly reviews and two 60-minute face-to-face meetings.
Knapp took an idea from a financial advisor in the Supernova program and turned it into the 90-Day Free Look: qualified clients who can’t make a decision immediately get an abbreviated plan with three months of contact, reviews and meetings, rapid response, and planning when possible. Knapp describes what usually happens next:
“This will give the prospect all the reasons they need to exit their existing FA relationship. This is the traditional “puppy dog’’ close. Try taking an adorable puppy home for 90 days and then give it back at the end of the trial. Probably not going to happen!’’
Other marketing tools include establishing a mastermind group, comprised of other professionals who will help advisors through sharing of collective wisdom and introductions; assumption of community board positions, which introduces advisors to potential clients and professionals who will provide introductions, while the advisor gives to the community; creating niches, which will target potential clients and provide “a lot of multiplying power,’’ as Knapp says, and, creating a social networking plan, to build connections.
More challenging, Knapp admits, is meeting the goal of “one ‘ask’ for an introduction from a client during each in-person meeting. Notice I don’t call them ‘referrals.’ Getting referrals is a tired play in the sales handbook. Supernova practices grow on earning intentional and meaningful introductions, not a casually tossed off list of names,’’ he writes.
“Financial planning, rapid response and 12-4-2 are sacred. Everything else is on the table,’’ Knapp writes.
Out of the original Supernova model grew what Knapp calls Supernova Gameboard, which measures activities, not results, and “redistributes leadership across the practice by accountability,’’ Knapp writes.
The Supernova Multiplier plan for improving closure rates says that better quality prospects come from getting introductions from valued centers of influence; mastermind groups, community boards and networks: the better the introduction, the higher the closure rate, Knapp says. He also suggests offering a prospect the 90-Day Free Look plan.
Regarding the all-important issue of introductions, Knapp’s book provides five steps to meeting valuable centers of influence and six steps to getting into niche groups for introductions and professional and personal growth.
Throughout his book, Knapp says that giving is the beginning of increased success and growth. He equates giving with being a trusted member of the community, professionally and personally, and refers to Adam Grant’s “Give and Take’’:
“The world is made up of three kinds of people: givers, takers and matchers. Grant asserts that all three types can be successful but the givers are the most successful (and the happiest).’’“Becoming known and trusted in your community is necessary if you want to do business in that market. In fact, community involvement makes you into a marketing magnet,’’ Knapp says.
All proceeds of the book go to The Knapp Family Foundation, which helps finance education for the needy.
The Supernova Multiplier: 7 Strategies for Financial Advisors to Grow Their Practices, by Rob Knapp. John Wiley & Sons Inc. $34.95. 197 pages.
Eleanor O’Sullivan is an award-winning journalist who writes for Financial Advisor.