Is Future Cashflow Analysis part of your client proposition?

As the financial advice sector shifts steadily away from product based selling towards true advice propositions, the role of future cashflow analysis is coming more and more to the forefront. To pin my colours to the mast, I’ll go as far to say that I believe future cashflow analysis will become the cornerstone of the financial planning model of the future.

Why I hear you ask…


First of all, regulatory change will somewhat drive this process. The financial regulator has publicly declared their determination to remove any potential bias or conflicts of interest from the sale of financial products. While this does not necessarily mean an introduction of the market changes as seen in the UK under the Retail Distribution Review (RDR), there is no doubt that at a minimum there will in the future be a demand for even greater transparency in how product choices are made by advisers, and in the method and levels of remuneration received.

There are many advisers who are already very comfortable with this, who already have developed clear advice propositions for their clients, with products then being utilised to achieve the objectives identified in the development of a financial plan. This is a great step, however it can’t just be about “dressing up” a product recommendation. Your process needs to help plot out the financial future for your clients, not simply be a point in time report. Is a plan really a plan for the future without future cashflow analysis?

To my mind, excellent Financial Planning is a more holistic, long term approach, and future cashflow analysis sits at the heart of excellent financial planning.

Basis of ongoing value

This really is the nub of why I think future cashflow analysis plays such an important role. I think it adds so much value.

My own adviser uses the Voyant system, and for me this has transformed my own view of the incredible value a good financial planner, using the right tools can bring. I now have a clear picture of how my financial future is shaping up, where there are real challenges for me in achieving my objectives and as a result we have devised a strategy to meet these challenges. Note the “we”! This approach gets the adviser and client working collaboratively to identify the objectives, identify weak points and devise solutions.

And of course we need to review this every year as yes, there have been plenty of assumptions made; my earnings, savings, investment growth levels etc. But we have a firm foundation to work from and tweak as we go. These reviews are incredibly valuable to me, ones that I’m happy to pay for because of the value I get from them. So at the end of the day, future cashflow analysis can really help you lock in your client relationships.

It helps answer the difficult questions

One of the most important roles that financial advisers play, is helping their clients understand why they are saving money, investing into a pension etc. This can get lost in time as the focus shifts to the product chosen and how it is performing relative to benchmarks and peer products. As a result the desired outcomes and progress towards these outcomes can get lost.

The future cashflow analysis can be adjusted each year  to take account of product performance etc. to identify progress versus the stated objectives. This keeps the focus on the all-important end goals, the reasons why clients are investing in the first place.

At the end of the day, these are the answers that clients want answered. Every year at every review. “Will I run out of money”? “Can I afford to retire at age 65”? “Can I afford to educate my children as I want”? These are the questions that keep clients awake at night. These are the questions they want your help to address.

Introducing Future Cashflow Analysis to your clients

So how do you start? Well you can start with an excel spreadsheet if you are so inclined and develop your own model. Or instead, you can buy an off the shelf package. I mentioned the Voyant system system earlier as it so impressed me. It captures all the critical information, creates very engaging graphs for the adviser to walk through with clients and produces high quality reports for the adviser to use. If you’re not an excel whizz kid, it may well be the route to go.

So if like me you are convinced that future cashflow analysis is an integral part of proper financial planning, the first step is to embed it as a core part of your planning proposition to your clients. Tell them about it, make sure they fully understand the value to them of this approach and then charge them accordingly for the value you are adding. This can be through commissions earned on product sales or indeed through fees.

At the end of the day, future cashflow analysis can help to drive up the value clients place on your services, it can help to build a long term dependency on your services and it can drive up your revenue.

Do you use future cashflow analysis in your business. If so, do you agree with the above? If not, by not? All comments are welcome and will be shared!

Building a Rock Star Sales Team!

A number of businesses that I’ve been dealing with have identified clearly the value of having really excellent people in their sales team. They’ve seen quite significant differences in the performance of their most successful people as opposed to their weaker people. They’ve also noticed that these performances tend to get repeated, pretty much year after year. So what can you do to build a rock star sales team that will help you exceed your sales goals, year after year?

Know your team – scientifically!

Yes, I know it sounds very obvious but how well do you really know your sales team and do you judge them fairly? Or are your “best” sales people seen as such by reputation only, or as a result of long held beliefs that you’ve had in relation to their talent? Yes, reputations and your own gut feeling count for a lot, but on their own they are not enough.

If you are going to trust your brand to your sales team, you’ve got to make sure that they have the competencies and attributes to carry this out, every bit as well as you would do it yourself. So spend time working out what are these attributes (drive, professionalism, integrity, resilience etc.) and competencies (relationship building skills, advice approach, technical knowledge, writing / presentation skills etc.) that you value.

Once you have these identified, score all your sales team against these factors. In addition, you cannot ignore both their previous results and also the quality of their clientbase / territory – these should be brought into your analysis too.

Finally and most importantly, seek out the views of others. Get colleagues who also know the team well to score them too. Also, if possible, talk to some of your key customers. It’s quite probable that both of these other insights will throw up some surprises for you. Maybe they’ll uncover a “blind spot” you’ve had, which has resulted in you consistently under-rating / over-rating some individuals and maybe, just maybe it’s you who has to change!

Once you’ve done this exercise, you can be pretty confident that you’ve a solid view of your team and can recognise its strong and weak points.

Increase the number of winners

Winners need to be rewarded and with more than just money. Yes, money is very important but is usually not enough on it’s own. Winners like recognition; they like to be celebrated, both inside and outside your company. They also like to be listened to – properly. They’re successful for a reason so their views and insights should be heeded and where appropriate, acted upon. Winners also like to see where their success is going to take them over the longer term. So think about their career paths and future opportunities – before they take this decision out of your hands….

There will be quite a large group of people “in the middle” who are doing a competent job but probably not consistently shooting the lights out. These are the people that you need to challenge to move into the top tier. A mixture of setting appropriate goals for them, creating personal development plans that will increase their skills and driving the team harder in some cases will achieve this! Also let your stars demonstrate to these people how they are getting their great results. Your stars may help you raise the performance of some of these middle tier players.

Unfortunately you’ve got to be equally assertive in dealing with the serial under-performers who are also lacking in the attributes and competencies that you require. Remember when it comes to sales, “bad breath is worse than no breath” as these people run the risk of irreparably damaging relationships with some of your clients. So find new roles for these people or move them on. Get them out of your sales team. You’ll also gain more respect from the wider sales team for your willingness to act in relation to underperformance.

What happens when a rock star leaves the band?

That dreaded moment. Your best sales person comes to you saying, “Can I just have a minute” and you know what’s coming… So what do you do?

Do you try and stop them leaving? Yes unless the price is too high, you’re going to be a hostage to them in the future, their head is already gone out the door or by clinging on to them, you will completely unsettle the rest of the team to try a similar move!

You then need to consider how replaceable they actually are – internally or externally. If you have a strong “bench” of support people waiting for a sales opportunity, then maybe you just wish your star performer well. Also if you have a clear external recruitment plan for this very scenario ready to go, well then maybe it’s time to implement this now.

And of course, don’t forget your clients in all of this. Make sure you reassure them completely that your organisation will continue to meet and exceed their needs going forwards, even without this important sales person.

So, get really clear on the strengths and weaknesses of your team, have different approaches for your different players and remember, when the star leaves, it’s not necessarily the end of the world!


Have you any more thoughts on how to build an excellent sales team… or even what’s your favourite ACDC song! All comments welcome below.