Key to Success is to be True to Your Values

Tim Ross of Henderson Ross & Co Financial Group has a unique story to tell about the factors that influenced the transition of what was a purely risk-focused business in East Brisbane into one that successfully delivers broad-based financial advice to a client base that has itself grown and evolved.

 

This CPD quiz is based on a 2018 interview conducted by Riskinfo with Tim Ross of Henderson Ross & Co. Scroll down for the full transcript.

 

Peter Sobels
Hello Tim and thanks for taking the time to speak with us. I’d like to open by asking if you can give us a quick overview of your advice business.

Tim Ross
Henderson Ross is made up of myself and business partner Doug Henderson. We are passionate about helping businesses and individuals achieve their financial and lifestyle goals. Our aim is to build long-term partnerships with our clients and assist them in building, protecting and managing their wealth and lifestyle for them and their families.

Peter
What can you tell us about the proposition you go to market with?

Tim
We are fortunate in that we have had a lengthy history. We have some clients that we have had relationships with for upwards of 20 years. We have evolved a lot over that time.

Many of us have come out of the life insurance background because my dad [the founder of the business] was a technical training manager, and was a director of a general agency with Prudential back in the day. So we started from a life background.

We have evolved the business from that, and that means we have quite a book of legacy clients who might only have insurance with us.

And where I would say growth is coming in terms of our business is mainly from a lot of those clients entering that pre and post-retirement phase.

Peter
So your firm is slightly unusual in that it is a second generation risk-focused advice practice.

Tim
I wouldn’t say it is risk-focused. My dad was always interested in the technical elements around estate planning and financial planning.

And then probably with the advent of compulsory super and people’s growth in seeing that superannuation as a way to plan for their future. We did start to focus more on that and gradually it grew from the small contributions that were going in to where it is now at 9.5% and some employees it might even be higher.

So people’s Super balances, and seeing the opportunities that Super presents for tax-free income or concessionally taxed income in retirement has obviously seen a big growth in that sector of the market. So it’s probably been a fairly natural evolution that we have seen happen given many of our clients have been with us for a long time.

Peter
So your business has evolved, but what would you say has been the cause of your company’s success?

Tim
I’d say it comes back to the engagement that we are able to achieve with our clients. Our authenticity and the ethics and respect we have in the client relationship. Ultimately, that is what makes a business succeed or fail in the long run.

So the relationships that we have built with clients and the new ones that are refereed to us…We are very respectful of the fact that the decisions that need to be made are their’s but with our guidance.

We really try to nurture good relationships with clients. Transparency helps clients feel really comfortable in the way that we operate.

Peter
How do you build that trust? I know every advice business needs to find that formula, but how have you achieved this?

Tim
By just being genuine. By living the values that you say you are going to live. That comes across in the way you handle clients from the very first interview…When that unexpected phone call comes in, you should always welcome that interaction. That’s a key part of building the strength of the relationship, and for the clients to see you as a professional and trusted adviser, that is fundamentally important.

Peter
Are there other elements of the business that you have also worked on that have contributed to the success of Henderson Ross?

Tim
A key element of providing advice…there is at times a product outcome if you want to call it that.

Yes we provide a lot of advice, but there are times when that advice means the client needs to do something or put something in place, and that then results in there needing to have a product selected.

So we made a decision some time back to move our licensee, to move our business so that it was not aligned to any particular products. We feel that is a good thing for us, we have been down both roads at different times. We feel that it has been a good thing in terms of the breadth and the scope of products that we can consider for clients.

So we have made it our business to research the market to understand what quality products look like, what competitive pricing looks like, coupled with genuine efforts by us to give the right advice and put clients in touch with quality products that will provide them with security – products they can understand, and engage with.

Every licensee has an approved product list that is researched and so on. We feel that with greater choice comes greater opportunity and real objectivity. That is something that is important to us.

And for me personally, getting a business partner onboard that added areas (of knowledge) that weren’t my forte or background.
I came from more of a life background and my business partner Doug Henderson has interests in stocks and investments and company balance sheets. So from an investment perspective, and doing a deeper dive into the investment choices that we make for our clients, it has been great for me to have a partner like that. That is an essential element, getting the right people on the team. That is very important.

Peter
So it’s important to have people to fill the expertise gaps.

Tim
Yes, and I have learned a lot from Doug. The best learning you can do is with the practical side of things.

Peter
And what would you say are the mistakes you’ve learned from?

Tim
Would we do it all again in the same way? Yes we ‘probably’ would because we are where we are because we made those decisions, believing they were the right ones.

And I believe that even out of the things that perhaps had a sting in the tale or a bit of a negative experience, you still come out stronger on the other side of it, and you learn something that you then apply and adapt.

So I wouldn’t say I have regrets about the way we have done things. But I would say you have to continue to make decisions that you feel are in the best interest of your client. And if that is at the heart of the decisions that you are making, if that’s the primary focus that you have got – and you think ‘how can we do things that are more effective, more efficient, so the client relationship is strengthened’, your business will succeed, because that has to be at the core of what it is we do.

Peter
So you need to have the courage to commit to what you believe in to build your business?

Tim
Yes, absolutely. And when you see that something isn’t working then you need to go back to the drawing board and have a look at the alternatives, a different direction, to learn from what you have been doing to then fine tuning it and improve.

That’s what we have continued to do and even now, I am sure that financial planning in 10 or 20 years’ time will not be the same as it is today. So we need to be able to continue to adapt. To meet client expectations, and that will ensure our survival.

Peter
What’s your strategy for planning for the future?

Tim
You need to alert to what’s happening, not to try and live within our own bubble. To be a part of things such as industry associations such as the AFA which I am involved with.

To attend the various events that are put on where we can learn from our peers, to keep up-to-date with what’s happening, and to not be too affected by the negative noises, because sometimes there is a lot of negativity around that grabs the headlines. So look for the good things that are being done.

And then to ensure we raise our own bar professionally, so we can meet the needs of our clients and client expectations – they are the areas we need to be aware of and continue to be responsive to, and then the path will become clear.

If your senses are picking up on the direction that things are going in then you need to be adaptable.

Peter
So you have a very positive outlook on the continued evolution of your business?

Tim
Yes, in as much as the things that we can control. There are external forces when it comes to financial planning that can influence the decisions, and the two big ones are the government and the regulator.

So there will be some major changes as we move forward on that front. And to the extent that we can, if we think we can have any influence, if we felt those changes aren’t necessarily based on a full picture of the reality, we will try to bring that to the right people’s attention to show a broader view.

But where decisions are made, and they are finalised and become the law, then we adapt. That’s what we have done, and that’s what we will continue to do.

Peter
Finally what’s your key tip to a financial adviser starting out today?

Tim
Start the way you mean to go on in terms of the relationship with your clients. Build strong relationships, live the values that you espouse, be true to those values in the way you engage with your client. Have in mind their best interests at all times, and you will be guaranteed success.

Henderson Ross Financial Group is a financial planning business based in East Brisbane that has been providing professional planning advice for more than 30 years.

 

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