The Supernova Multiplier: 7 Strategies for Financial Advisors to Grow Their Practices

Foreword

When Larry Wilson wrote Rob Knapp's Foreword for The Supernova Advisor, Larry stated, Rob and his team have a PhD in the hard knocks school of leaders leading change. Better yet, they transformed what they learned into a powerful change system called Supernova.

A lot has happened to Rob and his Supernova Consulting Group since those heady days of transforming chaos to process using the Supernova model. The model has evolved and become the service model of thousands of Financial Advisory teams throughout the world. Having that eagle-eye view across the industry has given Rob a unique perspective. Rob Shaffer, Supernova coach and friend of the author for over 30 years, said it best, If I only knew then [when he was managing offices] what I know now, what a difference I could have made. Rob Knapp successfully shares that experience in The Supernova Multiplier".

This book picks up where The Supernova Advisor left off. If you haven't read the first book, don't worry, Knapp gives you a quick summary in the introduction. Rob reviews the Supernova process of segmentation and organization, gives you numerous updated and improved ideas, and then dives into acquisition.

Growing practices has been the biggest challenge of the modern financial services industry. Knapp takes on that challenge by offering the 7 strategies for Growth, with real-life examples, testimonials, and key takeaways for each strategy. Nowhere has anyone gone into so much detail on exactly how to step-by-step transform your chaotic acquisition strategy to one that is based on a Supernova process. As a former Naval Aviator, Knapp believes in plan, process, and rituals. He literally gives you checklists to follow as you go from one strategy to the next.

Knapp will show you why some financial advisor's (FA's) with similar talent, experience, and drive are successful using these models while others never get the results. How many times have we heard, I've tried using [COIs, Boards, Networking groups], but I never get any referrals. Rob interviews numerous FAs who in their own words tell you their secrets to breaking through those barriers.

Rob will not only get you on the right path, but show you how to build in the rituals and accountability tools to keep you on track. How many times have you heard, I used to do that and it really worked, but I don't do it now. This FA has no real rituals built into the system and no accountability. Plato said, learning is remembering. Just because something sounds familiar doesn't mean you really understand how it will benefit you in modern-day marketing. Open your mind and let these ideas in. Knapp stated, I haven't held anything back here. I have put every good idea from the last ten years of coaching and my 45 years in the world of sales and marketing into this book. For Rob this book was a labor of love. Taking over three years to create, with hundreds of interviews and thousands of coaching hours, Rob has learned as much from his students as he has taught. Rob intends to donate all proceeds to his foundation, which is dedicated to educating those less fortunate, as he has done with his previous books.

Now dive into The Supernova Multiplier with the mindset of an eager learner and this will be as transformational as any journey you have ever taken.

Steve Siebold, author,

Secrets Self-Made Millionaires Teach Their Kids

Acknowledgments

The Supernova Multiplier was created out of a desire to share everything we have learned since we began the Supernova Consulting Group in 2006. That is a tall order. We interviewed over 100 Financial Advisors (FAs) who went through our year-long coaching program and showed tremendous growth. We could not include them all in this book but rather used several examples for each of the 7 Strategies for Growth. Their contribution to this book gave it credibility. Their creativity in adapting these ideas to their practice gave us some exceptional breakthroughs. Let me first thank Bob Mulholland who gave us permission to speak to both his staff and Financial Advisors. His leadership, first at Merrill Lynch and then at another major financial services firm, gave our program tremendous credibility. He encouraged us to roll out Supernova to all regions of his firm. Not once but again two years later. We trained over 3,000 Financial Advisors and their teams. We trained their top managers and saw the program get tremendous traction and success. Bob has since retired, but his legacy lives on. The FA satisfaction rate went from the low 30s to the 80s during his tenure. An outstanding accomplishment. Critical players on his team who became completely immersed in the program were Heather Gifford, Gerry Schreck, Chuck Patton, Greg Staab, Clay Bedford, and Dick Lown. Many of these professionals were out in the field with our team coordinating, presenting, and supporting, and coaching the program. Some of their words appear in the text of this book.

Financial Advisors who adopted the Supernova model, gave testimonials in front of their peers, and were interviewed for this book include Ken Shapiro, Tom Laviccaro, Luke Wiley, Alissa Quinn, Rob Benoit, Rick Rogers, Laurie Barry, Greg Kadet, Hugh Stephenson, Kim Jenson, Brad Desormeau, Ben Tarantino, Kevin McGrath, Patrick Renn, Cromwell Baum, Hugh Stephenson, John Hurlow, and Michael Beers.

Tom Anderson went so far as to contribute a whole chapter to the book. Bill Cates offered his expertise on Getting More Referrals Now, mastermind groups and networking. I will be eternally grateful to my team at Supernova who helped create content, coached thousands of teams, and gave overall support to this book. They are Rob Shaffer, Curtis Brown, Stan Craig, Lori Showley, and Rob Kennedy. I relied on others for their counsel and expertise especially Jim McEnerney, Jim Guthrie, and Rick Knapp.

Editing was done by Cindy Beuoy, Jennifer Werner, Greg Perry, Courtney Knapp, and Marcia Knapp. Thanks to the team from Wiley who did the final editing and pulled all the pieces together.

A special thanks goes to my friend and business associate, Cindy Beuoy, who was the driving force behind this work. When I would fall behind my timeline, she would always be there to get me back on track. In the final 36 hours she edited for 18 hours. Her passion for the work, the mission, and this book is something very special. We have done two books in the last 12 months and that is no easy feat.

Finally, a big thank you to my wife Marcia who puts up with my long hours and days of travel and shares our mission of Improving the client experience worldwide by improving the FA experience.

As with The Supernova Advisor, all proceeds of this book will go to The Knapp Family Foundation, whose mission is to make available education to those who might not be able to afford it.

Introduction

One of the most significant joys of my life continues to be helping high performers push through to even greater achievements, and yes, push through is the right way to describe the effort. Professionals who are already operating at the higher levels of production have long ago mastered the fundamentals and put in place practices, habits, and rituals that consistently propel them to the top. They attract the best clients. They build the most productive networks.

High performers are the 20% who deliver 80% of everything that's good: new money, better clients, sharper staff. It's no easy thing to guide them to an even higher realm. This push through encompasses three elements: coaching that's close and invested, a commitment strong enough to endure plateaus and even setbacks, and, most of all, it requires a model…a framework that builds success and tools that are precisely calibrated to the specific demands of exceptional performance.

In the world of advising high-net-worth clients, that model is Supernova.

Supernova emerged from the dual crisis of the bear market of the early 2000s and the growing dissatisfaction of the clients we served—or, more precisely, didn't serve very well. A group of phenomenal individuals and I built Supernova to answer a simple but surprisingly complex question: What does it take to deliver the ultimate client experience?

Evolution of Supernova

A bit of background to give those new to Supernova a quick overview of the model. I wrote The Supernova Advisor in 2007 and Wiley published it in 2008. While this book is written as a stand-alone resource, reading The Supernova Advisor may offer you broader and deeper understanding of the model. Heck, even if you did read it, take another look. Landing at just over 100 pages, it's not going to take long to reconnect with the core ideas we previously presented:

It all begins with a financial plan. Implementing that plan is the key. It is indeed an ongoing process that never ends.

The 80/20 Rule defines your book of business more effectively than any other principle. That is, 20% of your clients give you 80% of your income. Having more clients doesn't change that; it just means you're working more and delivering less.

The ultimate client experience is not the result of great products or your brilliant investment strategy. Ultimate experiences are assembled, call by call, meeting by meeting, in the form of regular and scheduled contact. We call it 12-4-2. Twelve scheduled contacts, one per month, four of which include a quarterly review of the full portfolio, and two 60-minute, face-to-face meetings with a broad but specific agenda. This is not a suggestion. This is the bedrock from which Supernova originates.

The only way to maintain a 12-4-2 contact discipline is to reduce your book from 300 or 400 clients to about 100. That's the maximum number of clients you can serve. (You can add more if you want to work nights and weekends.) Every one of those clients has assets that equal or surpass a minimum you set. It is called segmentation with a min/max. And despite how it looks, it's also how you grow.

Supernova inverts the org chart. Top-down, command/control is out. Administrators who set the calendar are now driving the day-to-day. Client files stay on paper and in folders. Everything is documented, which compliance just loves and so will you!

A referable service model is not a certification you earn; it's a commitment you make. It's becoming the CFO for your clients, and it moves forward on expressing personal values, not just increasing asset value.

New client acquisition happens organically, deliberately, and continually. A higher minimum is the first step, and exceptional service makes it possible. Pushing everything forward is a precise plan of networking specialization. And by precise we mean scheduled, and accountable.

Leadership in a Supernova practice is about serving not directing. It's transparent. It's scheduled and measured every single day. Stewardship is a fine idea for a forest. In a Supernova practice, however, change and improvement are the oxygen everyone breathes. Without it, the practice will stagnate.

That's a Supernova lightning round. Know where your income comes from and structure your practice around it. Contact your clients on a predictable schedule with meaningful content. Segment your book into a manageable number. Organize the practice around the rhythm of regular client contact. Plan with your clients versus reacting to them or the financial markets. Grow the practice with a series of acquisition techniques that are both expansive in nature and regular in frequency. Lead by serving and by propelling change. Supernova is a transformative model for most Financial Advisors (FAs), and it can literally change your life. Supernova delivers a more productive and deeper relationship between advisors and their most profitable clients and has the added benefit of also making them richer. This model results in, at the minimum, slow and steady growth without fear of plateauing and at the maximum, a doubling or even tripling of your practice.

When I retired I felt Supernova was an enormously satisfying legacy to leave behind to others. I thought my job was done and I would be spending the rest of my days enjoying my family, hiking, golfing, fishing, and playing tennis. That was until my daughter Courtney reminded me of my mission statement to go where no man has gone before and joyfully share the map. I was also hearing from friends, still in the field, some version of: Supernova is too good—too important—to fade away in your absence. With my daughter's encouragement and my desire to give back to the industry I had devoted my life to, I decided I should write a book.

The Supernova Advisor was a how-to guide on implementing the Supernova Process, but what gave the book its heartbeat was not the practical guidance; it was the personal stories, including mine. Supernova was my awakening as a better advisor and leader. All along, I could see where I wanted my career to go but I didn't know there was a bridge right in front of me until my team and I took the first steps.

The first book is an inspiring collection of stories of advisors' lives changed for the better and their clients' true potential reached. I know they were inspiring because again and again, readers told me so. I was grateful and humbled to receive countless calls and notes brimming with appreciation. The reviews were fabulous. The book made a few Best Of lists. The first print run sold out, so did the second, and the third! And even if you don't read, or re-read, The Supernova Advisor, its final sentence tells you something important. After expressing my thanks for the extraordinary people who helped me shape the Supernova model, I ended it with:

And now, it's yours.

With that official handing over of the reins, I envisioned my post-publishing career as the benevolent architect of Supernova. My thinking was that while I would be speaking to big groups in big rooms about the process, the advisors who first implemented it would be sending a steady stream of validating anecdotes and comforting statistics my way. It was going to be many things…comfortable, satisfying, and mostly, hands-off.

And then, after I spoke at a national firm's annual meeting about Supernova, the firm approached me about coaching their advisors. Running a quirky little solo business after a long corporate career was not part of my plan. Then another firm requested a group of Supernova consultants to train their FAs and ended up integrating the Supernova Process into their practice management program nationwide.

I guess I could have said no. And maybe I would have if what I was seeing in the industry was more reassuring. Instead it was distressing, and that included the advisors who had initially embraced Supernova.

Readers of the first book will remember that we developed the model from iteration and experimentation, and then spread the word in big town hall-style meetings. We weren't there to coach Supernova; we had our own day jobs. For the most part, Supernova was a Do-It-Yourself undertaking, and as the saying goes: your mileage may vary.

And vary it did. Once the book was out, some teams—not just Merrill, but across the industry—read it and somehow encoded Supernova beautifully into their organizational DNA. But they were by far the exception. Some tried to slice different genes onto the model and the results were predictably mutated. Others did their best with what they had and what they knew, but it wasn't enough. They needed a coach. And I wasn't going to watch as Supernova failed. I owed it to my original team and I owed it to myself. But mostly, I owed it to the advisors who, in growing desperation, had reached out to me and said, We know this will work but we don't know how.

So, I built the Supernova Consulting Group by putting together a team of talented consultants who I trained to coach the program. We developed and refined a suite of coaching tools. I went from hands-off to over-my-head, and along the way I got inside the Supernova model more deeply than I ever had before. It offered me an important vantage point from which to view an emerging trend that was spreading quickly across practices in large firms and even small independents.

A tiered model of client service was quickly taking root. The categorization of clients, A clients, B clients, C clients, and so on. became prevalent. Different firms had different ways to define them, but the tiers were becoming the norm. It was a perverted kind of Supernova segmentation—no minimum, no maximum, all the disorder and difficulties of too many clients paying advisors too much for too little real advising. It's also critical to say this: Supernova could get better. By coaching teams up close, we saw that Supernova's Five Stars could be better aligned to unleash optimal results.

By watching practices grow, and fail to grow, we learned a whole new vocabulary of acquisition that puts giving at the center…not giving in order to receive, merely giving.