Why You Need Strategic Alliances

CPAs, attorneys and other professionals can help you take your practice to the next level.

By John Bowen, founder and CEO of CEG Worldwide

Key Takeaways:

  • Referrals from other professionals are a key source of new clients for 81.9 percent of today’s top financial advisors.
  • Unlike informal referral arrangements, true strategic alliances create economic glue that leads to long-term success.
  • Focus initially on building alliances with CPAs and attorneys, then consider branching out from there.

Want a steady stream of new prospects? Enlist an attorney or a CPA for help.

Strategic alliances with other professionals are one of the best ways to ramp up your business. We coach hundreds of top advisors, and we see that most of the ones who achieve huge breakthroughs—the kind that propel their practices to the highest levels of success—are those who execute on building great relationships with outside professionals.

What a strategic alliance is not

To achieve wins in this area, it’s important first to understand what a strategic alliance is and is not. For example, financial advisors often call other professionals and invite them to lunch with the misplaced hope of getting referrals. They spend most of the lunch attempting to differentiate themselves from the competition so that the other professionals would be comfortable sending their clients to them.

These are informal arrangements, not true alliances. The problem—one you may be familiar with if you’ve gone down this road—is that these types of informal arrangements rarely provide any meaningful level of high-net-worth referrals. Here are three reasons:

  1. There is no consistently compelling reason for the other professional to make referrals to you.
  2. There is nothing that binds the relationship together over time.
  3. There will always be another financial advisor behind you who will generate doubt about whether the other professional should continue to refer his or her clients to you.

A true strategic alliance, by contrast, is a business development agreement that creates a vested interest for each partner to help the other grow. This agreement is a formalized, ongoing relationship that has been clearly spelled out and committed to by both sides and sets the stage for a long-term, profitable relationship for both parties. At the heart of the agreement is a set of genuine benefits to the other professional—most often in the form of additional services or more specialized expertise—that results in additional revenue to the other firm. The end result: The agreement creates “economic glue” to hold together a mutually beneficial partnership.

The benefits of true strategic alliances

We know for a fact that genuine strategic alliances are an important resource for today’s top advisors. When CEG Worldwide surveyed nearly 2,100 advisors, we discovered that 81.9 percent of wealth managers see referrals from other professionals as a very important source of new clients. In sharp contrast, just over a quarter of investment generalists (26.2 percent) see such referrals as a very important source of new business.

As I’ve pointed out in other articles, wealth managers earn $881,000 on average, versus just $279,000 for their investment generalist peers. That fact alone should tell you to pay attention to the habits and practices of today’s wealth managers.

Another key finding: Referrals from other professionals are a major driver of wealth managers’ success. Again, a full 81.9 percent of wealth managers told us their five best new clients were the result of referrals from other professionals—almost five times the number whose best clients came through the next-best method, client referrals.

So where do you start? Finding potential outside professionals to work with is easy. Good eligible candidates include accountants who work with individuals and families within your target niche, attorneys (particularly private client lawyers who specialize in trusts and estates and wealth protection), association executives who work with organizations that serve your target client base, business brokers who deal with the sale of closely held businesses, consultants, human resource directors looking to help their employees better understand how to solve their financial challenges, life insurance agents who serve high-end clients, and others. In short, the opportunities are plentiful.


That said, I recommend that you focus initially on building alliances with accountants and attorneys. Why? For starters, CPAs and attorneys are increasingly looking to provide financial services to their clients. Additionally, industry research tells us that most affluent investors tend to find their trusted advisors through their accountants and attorneys. (In an upcoming article, I’ll show you the steps to take to build rock-solid strategic alliances with these two key professionals.)

By taking full advantage of the opportunity that these alliances present, you will put yourself on a path to tremendous success and leapfrog past your competitors.

About the Author

CEG Worldwide’s founder and CEO, John Bowen has long been known as a leader in the area of adding value to financial services firms. Bowen started his career as an independent broker-dealer representative and then became a fee-based financial advisor. He was ultimately named the CEO of Reinhardt Werba Bowen (RWB), a money management firm that helped other financial advisors raise billions of dollars in assets. In 1998, Bowen became CEO of Assante Capital Management upon the acquisition of RWB by Assante. He left Assante to start CEG Worldwide in 2001, in order to help advisors realize substantial success through the use of CEG Worldwide’s business development systems.

He is the author of many books, including Breaking Through: Building a World-Class Wealth Management Business and The Prudent Investor’s Guide to Beating the Market.