"The most successful study groups are part sales and marketing tools, part technical training, and part brainstorming."

Expert Companions

By John Bowen

Given the rapid pace of change in the financial services industry today, you must make a lifelong commitment to learning to reach and remain in the ranks of the elite advisors. There are two reasons for this.

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First, client expectations are growing steadily, driven by an increasing sophistication and the improving quality of competition for assets. Second, you face more complexity from government agencies on both the regulatory and compliance fronts. When you combine these two factors, you have a work environment that requires you to constantly update your knowledge on how to best serve your clients.

Unfortunately for advisors, the continuing education requirements for almost all financial designations will not be enough. Most of these deal only with maintaining your technical competency. You need to go beyond becoming a great technical expert and also become a great entrepreneur.

One innovative approach to furthering your lifelong learning efforts is to share information with other financial advisors like yourself. Almost all advisors agree that it's important to have a support network of peers. The challenge, however, is not just finding suitable peers but working collectively with them on an ongoing basis to create real success together.

A proven way to do this is to take part in an expert study group. Expert study groups are a powerful method not only to increase your knowledge but also ultimately to increase your productivity and your bottom line.

While formal study groups have long been used in the life insurance industry, they are a relatively new tool in the financial planning business. Many advisors are now beginning to recognize the value of exchanging information and experience with their peers, however, and they are starting to form their own expert study groups.

The most successful study groups are part sales and marketing tools, part technical training, and part brainstorming. Study groups are comfortable places for advisors to exchange knowledge, skills, information, and motivation. Since elite advisors recognize that there is more than enough success to go around for everyone, they are also a place where cooperation is encouraged and competition is de-emphasized.

Despite the benefits, many financial advisors still believe it is hard to establish a study group. Research by CEG Worldwide principals found that almost 85 percent of advisors—both independent broker-dealer reps and RIAs—think it's a challenge to establish a top-of-the-line study group.

Given your limited time, you obviously want to get as much as possible from your study group experience. As recent research from the insurance industry indicates, not all study groups are created equal.

Broadly speaking, there are two types of study groups—expert groups and non-expert groups. The characteristics of expert study groups are quite distinct from non-expert groups. These differences break out in four main areas:

1. Degree of structure. Expert study groups are highly structured. In contrast to non-expert groups, they usually create and follow clear agendas. Ideally, they have between 12 and 15 members and meet for one day, anywhere from two to four times per year.

2. Use of interactive training. Expert study groups use a variety of interactive training methodologies with a high degree of organized participation. Expert groups use these educational tools much more frequently than non-expert groups.

3. Use of outside presenters. Expert study groups often use outside presenters at their gatherings, bringing in recognized authorities to help them become more productive. Non-expert study groups, on the other hand, seldom bring in outside experts.

4. Focus. Expert study groups focus on the best practices for attracting and retaining affluent investors, while non-expert groups often emphasize products and selling. By endeavoring to understand the affluent market, expert groups generate more ideas and strategies for action, helping participants to devise new and often innovative marketing and prospecting techniques.

These differences translate into real increases in effectiveness for members of expert study groups. A study of career insurance agents done by CEG Worldwide principal Russ Alan Prince pinpointed the dramatic difference in productivity between those belonging to expert study groups, those belonging to non-expert study groups, and those belonging to no group at all.

Insurance agents in non-expert study groups were 1.6 times more productive than those agents who did not participate in a group, according to the study. For every $10,000 of first-year commissionable premiums produced by non-participants, members of non-expert groups produced $16,000. Insurance agents in expert study groups were even more effective, producing $82,000 in first year commissionable premiums for every $10,000 produced by non-participants.

When it comes to becoming a member of an expert study group, financial advisors have two options—joining an existing group or forming a new one themselves from scratch. Ideally you won't need to form your own group but rather will join an existing one. Naturally you'll want to find the group that will help you learn specifically what you need to achieve your particular business goals.

The best way to accomplish that is to ask both your wholesalers and the top people at the financial institutions that you partner with for recommendations for study groups that would meet your specific needs. Once you've found several possibilities, interview members of those groups to find out what they are doing and whether they would help you reach your next level of success. If you're able to find one that would do this, approach the existing members and ask to join.

If you are unable to locate an appropriate group that meets your needs, you'll need to go the second route, which is to form your own group. To create your own group, you'll want a minimum of eight advisors, including yourself. The ideal number of members is 12, but you should go no higher than 15. These advisors should be willing to get together a minimum of twice a year, but no more than four times each year.

You can use your local FPA chapter or other professional organizations as resources to help you identify interested and likeminded peers. As you choose advisors for your group, keep in mind your end goal—increasing the effectiveness and the profitability of each member of the group. To achieve this, all the advisors in the group should be focused on growing their businesses by working with affluent clients, but none them should be direct competitors. At the same time, there should be enough differences between each advisor's practice and experience that everyone remains interested in getting together and sharing ideas. Different opinions and outlooks keep the discussion fresh and informative.

In the best possible case, every advisor in your group should be more successful than you. Regardless of this, however, every group member should have a passion for success.

To attain the focus your group will need to succeed, it's critical to structure each meeting carefully. In my work with corporate clients, I always recommend a model agenda that allows time for an outside speaker as well as informal networking. Most importantly, it includes an executive session devoted exclusively to solving the business challenges faced by financial advisors in the group.

The overriding benefit of participating in an expert study group is clear: There is no better way to leverage the experience and expertise of your most successful peers to increase your own knowledge, productivity, and income. As a result, you should seriously consider making an expert study group part of your lifelong learning efforts.