Better Together: How TPAs Make the Most of Advisor Relationships

By Mike Bushnell • October 29, 2014 • 0 Comments
Today, third-party administrators are partnering with plan advisors like never before, providing more robust packages to clients than either could support by themselves. But just like any other team, the partnership can easily fall apart if everyone isn’t working together.

At an Oct. 28 workshop at the 2014 ASPPA Annual Conference, JJ McKinney of Retirement Strategies, Inc. and Pentegra's Pete Swisher told a group of TPAs how they can build “home run relationships” with their advisors and win more business than they ever could on their own.

Some advisors are inherently difficult to deal with, Swisher said, and communication and teamwork are the keys to making the relationship work. It’s a tough balance, both professionally and personally --  when Swisher asked the crowd of TPAs, “Do advisors annoy you?”, nearly all of them raised their hands.

Swisher said it is critical for TPAs who are partnering with advisors to set expectations for the relationship and then stick to them. He said TPAs need to assert to advisors that they will be in the room pitching the clients, and that there are some kinds of levels of service they just can’t, and shouldn’t, provide.

In an advisor-TPA relationship, as with all human connections, confidence goes a long way toward building a strong bond and a mutually beneficial partnership, McKinney said. “Even your best home-run advisor relationship is going to have bumps in the road, and the golden rule goes a long way,” Swisher added. “But you have to have a standard where you’re out there, with the advisor, or otherwise you’re not going to have any control in this relationship between the TPA, the advisor, and the client.”

TPAs need to be able to succinctly and convincingly prove their worth to both advisors and clients in a short time frame, said McKinney. A really short time frame. “If you cannot deliver your value proposition in 10 seconds or less, there’s something wrong,” he said. “It says you haven’t done enough work, and you’re going to struggle to close deals.”

McKinney also emphasized that if a TPA-advisor partnership is going to be a team that works and succeeds, they need to meet with plan sponsors together. If a TPA goes into the meeting alone, they run a very real risk that the potential client will think, “Do you even know what, or who, you’re talking about?”

But “If you go in together, you can sell the client on both of your skills together, and build them both up,” McKinney said. “But if you’re just going in and telling them what the advisor is, they’re going to look at you like you’ve never actually met those people.”

Swisher said that too many TPAs hinder their businesses by not knowing what it is they really do. When he asked people to say in unison what exactly it is that they sell, many demurred.

“You sell labor,” he told the crowd. “You’re selling a fundamental ability to make the right choices and to provide a strong service. You’ve got people out there doing the work, but if you can’t sell advisors and potential clients on that work, you’re going to go nowhere.”