Clients who are “engaged” by the financial planning and advisory process are more loyal to their financial advisors and are more likely to provide referrals than those who are not engaged, says Julie Littlechild, CEO of Advisor Impact Inc. in Toronto. And engaged clients, she adds, are much more likely to see their advisors as leaders.

“The notion of leadership is a critical reflection of the way in which engaged clients view the role played by their advisor,” Littlechild says.

According to the Economics of Loyalty, the report from a recent study by Advisor Impact and the Toronto-based Investment Industry Association of Canada, almost nine in 10 engaged clients see their advisor as a leader.

To help you boost your perception as a leader among your clients, Littlechild offers the following advice:

> Offer guidance
One of the most critical elements to being seen as a leader by your clients, says Littlechild, is to provide good guidance.

“Clients tend to describe leadership as a form of active guidance in their lives,” Littlechild says.

That means you should, figuratively, take your clients by the hand and walk them through their finances, ease their fears and provide the advice they need.

Education is another important part of good guidance. Think of yourself as a teacher, with the responsibility to provide your clients with the necessary knowledge to make the decisions that will shape their financial future.

> Provide customized service
An important step in becoming a leader is helping your clients maintain long-term financial security. A key to long-term planning is the ability to provide a plan that is customized to the individual client’s needs.

A customized and personalized approach to dealing with clients is at the foundation of your position as a leader, Littlechild says.

Your clients are likely to hold you in higher regard if you approach each client with a strategy tailored to their needs, rather than simply following a “one size fits all” template.

> Manage relationships
Being a good relationship manager means interacting effectively both with your clients and with other professionals.

Taking a proactive approach to communicating with your clients is an important tool in engaging your clients that will enhance their perception of you as a leader. A well-organized client-relationship management system can be a helpful tool to help you manage your client communications.

Coordinating your relationships with other professionals — including colleagues and centres of influence, such as accountants and lawyers — is also important. In many cases, having those additional connections to help provide better service to clients can often result in increased loyalty and referrals.

This is the second instalment in an occasional series on how client engagement can benefit your practice. Next: Client engagement and referrals.