It’s an understandable sentiment, Portalatin says, due to the “incredible amount of change that has happened in the market.” It’s the adviser’s job, he adds, to find the solution that will maximize an employer’s ability to attract and retain talent. “We obviously play a very vital role in being able to help them figure out the right formula to win this talent war. Which is incredibly important.”
Chicago-based Pacific Resources is focused on large, national accounts, but CEO Paul Barden says the company’s approach to client service wouldn’t change with market size or client base. It’s about focusing on what your customer is looking for, really understanding what it is they’re trying to solve for and then offering solutions and backfilling resources based on the needs of that particular client,” he says.
Barden’s partner, President and COO Paul Rogers, adds that the last 24 months in particular have led to “a more intensified demand” for Pacific Resources’ ongoing service model. Most clients are trying to do more with less and need additional help communicating benefits, says Barden. The days of all employees receiving the same information pamphlet whether they’re a single 18-year-old woman or a 50-year-old man married with kids are over. “Now, the expectations because of technology are various modes of communication, targeted communication, targeting to different age groups. … That’s a challenge for our clients and we are taking an active role in really helping them define success within an enrollment and communication strategy around benefits,” Barden says.
Since the implementation of the Affordable Care Act in particular, Pacific Resources has made an effort to be agnostic and consultative with clients, rather than offer a specific solution up front. “Our clients are demanding a lot more options than they have in the past,” says Rogers. “They’re really reliant on us to have a good understanding of what their objectives are and what are the options they have to accomplish those objectives.”
With that service intensity comes greater demands on an adviser, such as looking beyond the previous standard of a one-year strategy for clients to three years or longer, Rogers says. As clients consider more options, the adviser must be there to provide them.
Building trusted relationships
Throughout the last 15 to 20 years, being a meaningful and effective adviser has increasingly meant more than just placing coverage, says Rusty Reid, chairman and CEO of Higginbotham in Fort Worth, Texas. Day one services, as Higginbotham calls them, around placing coverage for a client are “just a given,” says Reid. “What we think makes a big difference and what we as a company have invested heavily into is, what are you going to do day two?”
Advisers must think about what they are going to do on that “day two” to help clients control costs. With CFOs, presidents and CEOs now paying close attention to their benefits bottom line, “you better make sure that you’re doing things above and beyond just saying, ‘Well, I went to market and here’s some options for your consideration,’” says Reid. “You need to think about, how do I reverse this trend of cost increase? A lot of that is what we’ve invested heavily in. Obviously, when you’re a larger firm, it’s not as big a burden upon you as if you were a smaller firm, but I think if you don’t think about long-term how you’re going to control those costs for your customers, you’ll be left behind. Because that’s where the larger brokers are going to focus. I think that’s where your competition is going to hit you the hardest.”
Mercer has always prided itself on being a true, unbiased trusted adviser to clients, says Portalatin. “It is really what we’re all about. Meeting client needs by innovating for them and for their employees. It’s the cornerstone of building a sustainable, long-term trusted relationship.”
It’s also easier said than done, Portalatin adds. “That’s something that you have to earn every day. It takes a lot of flexibility and really takes a spirit of wanting to make a difference in driving differentiation and innovation and solving for issues that clients are asking you to solve for,” he says. “And it also takes a lot of investment in intellectual capital and thought leadership. It doesn’t all just come. You have to really work at staying on top of your game.”
The best rates, programs, products and carriers won’t save you from being seen as “just another vendor” if you don’t earn a client’s trust, says Portalatin. “All of this change reinforces how important it us for us to nurture and constantly strengthen our trusted adviser relationship with our clients,” he says.
Being an independent adviser is “becoming more of a valued commodity in today’s disruptive marketplace,” adds Pacific Resources’ Rogers. “We don’t sell a product; we solve problems for our clients and their employees.”
All of that problem solving comes with an increased time commitment — something all advisers need to learn how to balance. Large firms aren’t any smarter than small firms, says Mike Brewer, president of Kansas City, Mo.-based Lockton. The best advice he has for his peers in dealing with the growing requirements of being a benefit adviser is “be very purposeful about who you want to do business with, and then build products and resources that resonate with that market sector. If you’re a small-group person, be a really good small-group person. If you’re a great self-funding person, be a really great self-funding person. Just have a plan. Know who you want to go after and how you want to go after them and develop things that are going to differentiate you in that marketspace.”
Brewer adds, “ACA has created a huge amount of more work per client and our pricing’s got to catch up with the work. We’ve got to recognize and adjust our pricing model to reflect the level of work that our clients deserve and respect.”
Health care reform has “dominated the talk” with Higginbotham clients, but their expanding workload is not just about the ACA, says Michael Parks, chief operating officer and managing director of financial services. “We seem to meet with our clients a lot more often. And it’s not just health care reform. It is wellness. It’s anything we can do to help identify cost-saving strategies for them. It’s technology conversations. It’s administrative conversations and communications,” he says. “Throughout the year we seem to be involved with our clients a lot more than we were historically. I see that has a challenge in managing that, but it is going to be the driver for our growth going forward.”
For individual producers, Reid adds that they must spend a lot more time making sure clients are plugged into those additional day-two services. “Balancing that time is probably the greatest challenge we face in the upcoming years,” he says. “Being sure that you can focus as much on prospecting as you can take care of your existing client.”
Recruiting and retention
Finding the right people who possess such abilities is key to the future of the advising industry. In fact, Mercer’s Portalatin calls “attracting and retaining the best people in the business” one of the top two obstacles in the field.
Lockton’s Brewer agrees. “We’re having a difficult time — as the people who compete with us are as well — identifying and training the next generation of young people who are going to turn into great client-facing advocates for our employer clients,” he says.
The importance of filling your firm with the right people “can’t be underscored,” says Pacific Resources’ Rogers. “We go to extraordinary lengths to really define our culture as an organization and making sure that we find the right people that are very customer-centric and to fit within our organization,” he says. “We’re very proud of it.”
To identify their culture, a firm should consider what it is their business is trying to strive for and ensuring all employees understand that vision and strategy, adds Barden.
“Everyone in our organization really understands clearly and precisely what’s important to our clients, which means what’s important to us,” he says. “We only bring people in that are the right hire. We ask them to behave a certain way. We have values in our company that are expectations that our clients have given us. We really make sure we implement processes so that everyone can succeed under those premises.”