Like others in financial services, I’m fond of using sports analogies to make a difficult point.
While watching the 1st round of the 2013 NFL Draft, I thought it would be instructive to see what we could learn about selecting a financial advisor by watching how pro football General Managers select their next franchise player.
In trying to identify future Hall-of-Famers, GMs typically use two methods. One approach relies on analytics like the Wonderlic Test, a measure of intelligence that assesses learning and problem-solving capabilities. The other defaults to the Scouting Combine, which evaluates the prospect’s physical assets – height, arm length, weight and hands.
Both use a scoring system that helps football executives evaluate talent. Yet, for the all emphasis on objective analysis, neither approach is fail-safe. In fact, it may not be the best way to find a star like quarterback Tom Brady.
Brady was picked in the sixth round and scored poorly on many of the tests. But the graduate of Serra High School in San Mateo is one of the best quarterbacks to ever play the game. Now in his 14th season, Brady has played in five Super Bowls and won three of them. Ask nine out of 10 NFL diehards about the best draft pick ever, and Brady will be right up there.
The Legendary Gil Brandt
How do you find the next Tom Brady? Gil Brandt, the GM for the Dallas Cowboys from 1960 to 1988, was a master.
He chose one of the greatest quarterbacks ever, Hall-of-Famer Roger Staubach – not in the sixth round but in the 10th round! His first choice in the NFL draft was lineman Bob Lilly, another Hall-of-Famer. Gil’s got street cred on the topic.
Gil succeeded largely without the benefit of computers and a team of statisticians pouring over data. He did it the old fashioned-way. He would get to know the player, talk to the player’s parents, travel to the town where a player lived and ask locals what they thought of him.
Insights about a person’s character are especially important when you consider a wealth manager. At the end of the day, as Gil Brandt knew, character matters – a lot. It’s what sets people apart.
The good news is that it’s never been easier to evaluate someone. A client can learn about a financial advisor in just a few minutes: Do a Google search, check out an advisor’s LinkedIn profile, read their blog or follow them on Twitter.
After the research, it’s critical to ask for at least several meetings before making a choice. If an advisor won’t spend time with you while you are a prospect, imagine how you will be treated when you are client.
And ask for references. A friend of mine, a great wealth advisor, has a very unique approach to providing references to prospective clients: He offers up as many clients as the prospect would like to speak to.
If you match the information found online with face-to-face meetings, you can make a reasonable assessment of character.
With due diligence there’s a better chance of spotting people with character flaws, like former San Diego draft bust Ryan Leaf. Once considered a true talent, Leaf’s life has unfortunately unraveled and is now facing a number of criminal charges.