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What do you as a patient look for in a doctor?
Imagine that you are new to a city, you don't have too many friends here as yet, and you are looking to locate a doctor - a general practitioner in your locality, whom you and your family can go to for treating minor ailments - and you need to visit a doctor today to help treat your fever that has persisted for a few days. You identify two doctors in the neighbourhood : Dr. Anand Sharma, MBBS and Dr. Ravi Varma, MD (General Medicine). You have no references of either - you have to choose one. Instinctively perhaps, your choice will go towards Dr. Ravi Varma - for no other reason but that he has superior relevant qualifications to deal with problems that you go to him for.
Having made the choice, you go into his clinic and his assistant asks you to be seated in the waiting area, and await your turn. Your eyes naturally start taking in the surroundings and your attention immediately gets attracted to the various diplomas, citations, accreditations and recognitions that the doctor has proudly framed and hung on the walls for his patients to see. Instinctively, you not only look at what these citations are for, but also when he acquired them. Why do you do this? You are looking for evidence of his expertise through all these certifications - but you are also scanning all of these quickly to see how many of these are recent ones. What will go in your mind if all the citations and recognitions were received 10-15 years ago? How would you contrast that with a scenario where you see various citations and recognitions across the years, with some received in the last couple of years? Why is it that the second scenario gives you more comfort than the other? Its simply because you are looking for evidence that satisfies you that this doctor is not just resting on past laurels and outdated knowledge, but is clearly in with times and continues to sharpen his knowledge and skills and continues to be seen as an expert in his chosen field. In other words, he has continued to invest in himself, long after he got licensed to start a medical practice. When you see evidence of this in his waiting room, your confidence and comfort automatically grows in this doctor - even before you have actually met him. You are favourably disposed to trusting him even before the first meeting. A big driver in the way your mind has got influenced is your knowledge that the medical profession has made huge advances in the last couple of decades - and its important for your doctor to know the latest techniques and insights that can provide comfort and relief to patients.
Client expectations from financial advisors are not very different
Financial advisors often like to describe themselves as financial doctors - experts who ensure that a family's finances remain in good health just as the neighbourhood GP ensures that your family's health remains in good shape. Whether you choose to call yourself as an advisor or a distributor, clients' expectations of you have undergone a very significant change in the last two decades, and continues to evolve, driven by two key trends :
Two decades ago, distributors largely sold a variety of high interest bearing fixed income products to retail savers. The concept of transferring market risk to the investor became more prevalent as mutual funds came into being and as the Indian economy gradually globalised and saw interest rate cycles like other countries do. Investors need a lot more support when they are required to take market risk. -
As volatility in asset classes increases, as cycles get shorter, and as returns become less predictable, investors increasingly look for support from an expert to help them navigate financial markets and products, which they understand less today than the simple products that they bought 2 decades ago. After all, their needs and aspirations haven't reduced just because market returns have become more volatile.
Just an ARN may not be enough as client expectations increase
Financial advisors today need to therefore constantly invest in upgrading their knowledge and skills, to do justice to the expectations that investors increasingly have of them. It is not enough, in today's world, to only pass the mandatory NISM MFD certification test and go through a two day CPE once in 3 years. There are a few more options from NISM, which you may wish to take and add to your credentials :
MFD - Level 2 This is an advanced certification that any mutual fund distributor can take. Though not strictly comparable, think of it loosely as how you perceive MBBS as entry level certification for any doctor and MD as the level 2 certification. MFD - Level 2 is voluntary - just like MD is voluntary while MBBS is mandatory. Being a Level 2 certified distributor clearly demonstrates to your clients and prospects that you are progressing beyond the ordinary in terms of acquiring the relevant knowledge to guide investors appropriately - to sell well.
Wealth Academy offers you a Quick and Easy Guide to help you prepare for and take the MFD - Level 2 examinations confidently (Click Here)
Investment Advisor - Level 1 This is a recently introduced certification which you need to take if you wish to apply for SEBI registration as an investment advisor. Over time, there will be higher levels that will come into force as well. Think of this as a specialist cadre of advisors - much like you have specialists within the medical field. If you know you have a persisting stomach problem, would you want to look for a qualified MD (Gastroentology)? Wouldn't your local GP anyway refer you to a specialist gastroentologist when your problem has been diagnosed as a slightly complex gastro system related one?
There will be many more certifications that will be introduced over time by NISM - which is a SEBI owned body and therefore automatically carries the required credibility in an investor's eyes. In addition to NISM certifications, there are a number of other certifications that are relevant in your business as a financial advisor. These include
Certified Financial Planner (CFP ) : http://www.fpsbindia.org/
Chartered Wealth Manager (CWM) : http://aafmindia.co.in/
Certified International Wealth Manager (CIWM) : http://www.aiwmindia.com/
Would you not want to look up which ones are relevant for you, take those certifications and frame and hang up these certificates in your office? Would you not want a string of alphabets behind your name in your business card - which look very impressive to a client, and showcase clearly to him that you have the necessary qualifications to manage his money wisely?
Step one in your journey towards right selling is to ensure that you remain fully updated with all the knowledge that you need to do justice to your job. Equally, its important for you to visibly demonstrate to clients that you do possess relevant knowledge - certifications from credible entities do this job quite well.
Invest in yourself - on a daily basis
Certifications is one aspect - important but not really sufficient. What really will make the difference is the amount of time you set aside each week for personal learning. Here are some easy ways you can stay tuned with knowledge and information that is relevant to your profession :
Fund manager insights Every opportunity to hear quality fund managers or read their views in sites like Wealth Forum must be looked not as opportunities to discover new views on the market, but as opportunities to understand their interpretation of events and developments around us - which help you understand the rapidly evolving market a lot better. If you look for a bottom line view - a definitive statement whether market is likely to go up or down and to what extent, you are not likely to get this. But, if you tune your mind to understanding how these experts are interpreting financial market developments, you can gain significant insights that help you in your own customer interactions.
Read books and educational sites Have you set yourself a target of reading at least 2 educational books in a year that help you build your professional competence? If you haven't done so yet, now may be a great time for you to take this resolution. Invest in yourself - its clearly the best investment you can make. There is a lot of high quality educational material relevant for financial advisors that's available on the net. Wealth Forum has a dedicated section called Wealth Academy that offers a wide range of educational content (Click Here)
Sharing best practices There's a lot that you can learn from successful advisors - and sites like Wealth Forum regularly bring rich insights for you from successful advisors across the country.
Staying in touch with the latest professional developments and thoughts is a great way to keep investing in yourself - which in turn is perhaps the best way you can begin your journey towards right selling - towards guiding your clients appropriately.
All articles in the Sell Well - Grow Well section are created by Wealth Forum. These are not to be construed as opinions given by SBI Mutual Fund.
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