Advice for Advisors: Lessons Learned From Turbulent Markets

The first job I had after college was as an advisor associate, tasked with answering phone calls from clients in a small independent RIA. They encouraged me to politely take questions and provide answers—with the mission to solve whatever problems or issues might arise and protect the firm co-founders from interruptions to their work. Among other things, I also kept the office organized and helped prepare materials for meetings. I felt lucky to have found a job where I seemingly knew my responsibilities well and could easily complete all of my tasks on time. Lucky, for sure, because my faculty advisor in college was a client of the firm and made the introduction for me. And, although there were others in the position before me, I was the only employee other than the founders when I joined.

None of that is very interesting, except that I started in January of 2008.

Suddenly I’m the first line of defense with multi-million dollar families while they’re watching global markets in chaos. But, in the first few months, it seemed like a reasonable expectation that I could assist in the majority of calls that came in. In the first half of the year, I was mostly taking the usual calls with requests for cash or to schedule meetings. Then, all of a sudden, there were a couple of early calls from clients that signaled what was to come.

Clients were quickly getting nervous. Instead of transactional or administrative questions, clients might call to simply ask if there’s anything we should be doing differently. Especially for a young, novice member of the team, that’s a tough question to respond to without much training.

We certainly discussed the scope and expectations of my position as a team, but getting into specific scenarios and role-playing wasn’t something we did as a training tool. Instead, I’d often find myself in the middle of something completely foreign to me and we would do a retroactive debrief— both thorough and extended—to look for the apparent and hidden lessons.

In the physical layout of our workspaces, I was within very close proximity to the co-founders—sharing a wall with their offices—and we were all roughly projecting our voices towards each other based on how we were positioned in our seats. It was easy to listen in on every conversation. Though I felt immense pressure to have their listening ears intently focused on me, this was undoubtedly the most critically important experience of my early days learning the industry. Of course, it took me some time to recognize that after thinking back on my formative years there.

#1: Educate and empower your clients 

We eventually had debates among our team about how our plan might evolve as client calls increased in frequency and intensity. We used passive, long-term investment strategies and allocated a meaningful amount of our time to clients to educate them on our outlook and strategy. We were constantly pointing them to historical data on market performance and reminding clients that we would employ typical rebalancing strategies (selling over-performing classes and reinvesting the proceeds in under-performing classes) in both good and bad markets. This mindset was definitely reflected back to us based on the anecdotal data we compiled from these inbound client calls. So clients were getting it. At the time, we likely had somewhere in the neighborhood of 50 clients. So, it’s worth pointing out that because of our constant attempts at educating clients, and because of the size of our firm, the busiest of days wouldn’t have exceeded a handful of phone calls. The real test of my capabilities was that these calls were exceptionally long for me.

I can remember going to college, and, although I didn’t leave my hometown for school, I lived on campus and only visited my parents on holidays. That forced most of our conversations and keeping up to happen over the phone. I’ve never enjoyed lengthy phone conversations. At that age, as I attempted to morph into some semblance of an adult, I believed the gist of everything happening in my parents’ lives could be boiled down into a few words. That memory still sticks with me from college as being acutely painful.

Fast forward to the fall of 2008, and I’m finding myself in daily 20- or 30-minute phone conversations with clients to explore and respond to their feelings while their life savings is seemingly in peril. And some even lasted as long as 45 minutes. In our team meetings about how to deal with these calls, I was certain and hopeful that they would revoke my authority to take these calls so that the more experienced professionals could do their thing. But, ultimately, we never made a change, and I continued to take the lead as long as the calls were coming in one at a time.

#2: Find opportunities to offer feedback in real-time

The second lesson from my experience was how skilled they were at live training and how well it prepared me to bridge from administrative-focused responsibilities to advisor-focused. I had frequent, constructive feedback to shape my approach in almost real time. We held a debrief session after every client call where we evaluated the conversation from start to finish. Although my bosses couldn’t hear the clients’ half of the conversation, they listened intently to everything I did and made notes along the way. Every comment tied back to a higher educational theme and married elegantly with the firm’s desired voice. They even demonstrated incredible restraint when I made exceptionally poor word choices and failed to provide comfort to clients. Sometimes during the calls, they might drop a helpful note on my desk or encourage me with a thumbs up. And they constantly reminded me that the ‘hold’ button on the phone was always there as a lifeline.

Getting live experience on the phone gave me the room to find my way, make occasional mistakes, and ultimately develop the confidence needed. Now, it’s important to point out that—as my college experience with my parents' shows—I was not at all naturally skilled at working through intense, personal, emotionally-charged conversations on the phone. I hadn’t done anything remotely close to this before in my prior work experiences. It demanded every bit of effort.

Seek, when possible, to encourage this kind of engagement from those hiring and training you. Not everyone you work for will have experience managing young team members, so don’t be afraid to make requests regarding the frequency and openness of their feedback process.

#3: Be receptive to all feedback 

The third great lesson from those times was for me to keep an open mind to what felt like constant and rigorous criticism. I hadn’t been prepared by anything else in my life to have every word of mine dissected. I’m not sure how I survived it initially, but the intent must have always been clear to me: “the more attention we pay to you in your early development, the faster you’ll find your way to long-term success in your career.” If I were to start over again back at the beginning, I’d ask for even more and, if possible, from multiple sources. I was nearly always blind to my own biases and the humbling that comes by way of honest feedback is priceless. I remind myself often that my development would have been slowed dramatically if I hadn’t been given that gift.

#4: Remember that your clients are human too

The last great lesson from sharing so much time on the phone with our clients was that they were incredibly forgiving and gracious even despite the things weighing on their minds. Though I always felt inadequate in my attempts, I never received a single belittling comment or even a suggestion that I wasn’t doing my job well enough. The clients did certainly ask to speak to one of the senior co-founders—frequently—and that was certainly okay.

The true test, and the reason I look back on those times fondly, was in my ability to engage the clients and provide enough support for their concerns. If we concluded the call without a request to transfer to someone else on the team, I had hopefully provided what they needed. Note that everyone had been told about me joining the team and had been given background on my studies in college, so there was no hiding the fact that I was brand new to the industry. Nevermind the fact that I surely sounded like a child on the phone. The only part that came naturally to me was being genuine. I had no natural tendency to overpromise or oversell anything, so that might be why the clients treated me with such kindness.

People often said to me things like, “What a time to join the investment industry!” And I knew what they meant. It was incredibly challenging. But, a more acute observation would have been, “What a time to trust a young kid with so much responsibility.” When markets get volatile now, I think about those early days and smile because I learned so much while tending to those phones.

About the Author

Jeff Snodgrass is the Managing Director of XYPN Invest, which provides turn-key investment management solutions for time-savvy advisors ready to streamline their investment process. Jeff's favorite part about his job is connecting with the advisors XYPN Invest serves and hearing stories of the success and achievements of their clients. When he's not optimizing the XYPN Invest client experience or sharing his vast wealth of Orion knowledge, Jeff steeps himself in music—he's played the piano for 25 years and enjoys listening to live music. He also stays busy being the "best dad ever" to his four young kids.