Part 3: A Great Relationship Reaches Beyond the Advisor’s Salesperson

Part 3: A Great Relationship Reaches Beyond the Advisor’s Salesperson


Very often, the first person that contacts a prospective client is a salesperson. Successful sales people tend to be very skilled at what they do. However, investors should determine exactly with whom they will most often be working should the investor become a client. In other words, people are often attracted to a firm through a great relationship with a salesperson, only to find out that in the long run they will have little or no contact with that person. In most firms, the initial contact with a prospective client is made by a “finder” – a skilled person – but a person with a quota to fill which involves starting relationships, and not necessarily maintaining relationships.

Few investment professionals are fantastic salespeople, fantastic relationship managers, and fantastic investment managers. Many investment firms have a sales staff to attract clients, relationship managers to meet with clients and service their needs, and investment managers to tend to the portfolios and understand the nuances of investment management. Investors should be aware of the extent to which their relationship with the firm will involve a variety of people with a variety of skills.

Most people have had an unpleasant experience while buying a new car. Based on assurances of the salesperson that the dealership has an “incredible” service department eager to keep your new car in great shape with prompt, friendly service. Often, the service department fails to maintain the standard of excellence promised by the sales staff. Investors need to approach investment organizations with realistic expectations based on their own investigation of the firm’s culture before becoming a client. Make sure the firm has an adequate staff of capable professionals willing to meet your needs after you become a client.

The capabilities of the professionals can be established by educational credentials like college degrees, and not by training programs which often require nothing more than a few weeks of showing up and listening. Professional designations in investment management vary from those requiring years of valuable learning (e.g., the CFA program), to those which teach very little. By simply checking a few websites, you can separate the wheat from the chaff.  As of early 2018, this website offered a nice top-six ranking: CFA, CPA, CAIA, CFP, and FRM. Be careful of other web sites that promote designations primarily designed for salespeople.

So here is the final bit of advice: before committing to a relationship with a new firm, meet with all the people that you will ultimately be dealing with – not just the salesperson who has introduced you to the firm. Try to find a firm that fills the gap between sales and delivery by having low-sales-pressure professionals who meet with prospective clients, maintain long-term associations with clients, and whom are actively involved with the operations and investment sides of the business. Most firms that offer these kinds of long-term, broad-based relationships tend to be smaller firms with a focus on client needs.

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