Toyota To Financial Advisors
How To Achieve Long-Term Growth

By Shirley Hanson
copyright 2007

It’s now a national pastime -- answering the question,
"What can we learn from Toyota?"

It's not only major companies who are asking, but also a Los Angeles jail, a medical center wanting to improve patient care, and a parish seeking ideas for running a church.

You know the numbers. Toyota at the end of 2006 had a market capitalization of about $240 billion. Its annual net profit last year was $11.6 billion.

In this article I'd like to ask a question involving Toyota, but a slightly different one:

What would you do differently if you expected
to be in business 100 years from now, as Toyota does?

Or even if you were thinking only 20 years ahead?

In general, few activities would be focused on short-term gains. You’d take the longer view. With that in mind, we hand you these 4 lessons we harvested from Toyota . . . especially for financial advisors.

First Lesson: "Don’t Go For The Grand Slam
Home Run But For Ground Ball Singles"

So advises Matthew E. May, author and a Toyota business partner. He points out that it’s not about cars but about the one million ideas Toyota acts on each year. According to May, these are not blockbuster innovations but tiny ideas -- "effective ones nonetheless," although small.

Marketing Question for Financial Advisors:

Suppose you wanted to grow substantially every year for the next 20 years.

Would you serve yourself better by betting on one big idea or putting a dozen modest lead-generating, customer service, and customer retention ideas into play?

Second Lesson: Look For A Better Way

The idea of continual improvement came to Japan from W. Edwards Deming, and it is encompassed by the Japanese word Kaizen. Jon Gertner, in the New York Times, wrote that Kaizen "means never being satisfied."

It’s not about perfection. It’s about getting better.

Matthew May describes these three steps to getting better:

1. First, create a standard (a "standard" is a starting point),
2. Second, follow your standard, and
3. Third, find a better way.

Actually, there is a fourth step: Repeat the first three steps endlessly.

Marketing Question for Financial Advisors:

Think about two lead generating tools that you call on. How can you improve on them?

Third Lesson: Be Consistent Across The Board

Have a vision and principles and pursue them consistently through all the nooks and crannies of your business. That means not to be like the financial advisor with a vague and nebulous business.

The closest he came to a vision is "wanting to grow through a systemized plan." Plan for what? Plan for whom?

His clients are a motley crew, and he is not yet able to identify a group (or groups) of people he would like to work with.

In contrast Toyota has a mission, "to enrich society through the building of cars and trucks," and an obsession with customer satisfaction.

In designing its new truck, the Tundra, its engineers spent untold months in logging camps, horse farms, factories, and construction sites – observing and asking questions.

They noticed, for example, that contractors use pickups like mobile offices. So engineers created space next to the driver for office needs like a laptop and hanging files. Ultimately, to satisfy all its customers Toyota produced 31 variations of its Tundra.

Marketing Question for Financial Advisors:

Do you know your target market or markets well enough to "handcraft" services and programs especially for them so that you become the only choice?

Fourth Lesson: Be Slow And Steady
For A Long-Lasting Return On Your Investment

Your investment is the time, money, and people you put into growing and maintaining your business.

If your overriding principle is always to look out for your client’s interests before yours, you would stamp out the tendency to go for the biggest short-term gain. That new $400,000 account, for example, could result in a large immediate payout if it were put into an annuity. You might see, though, that your client would be best served by a more balanced approach.

With this longer, client-centered view client satisfaction could rise and your client retention rate along with it. And you could be in line to gain more referrals.

In twenty years the outcome could be a Toyota-like practice that would be an asset to sell or a way to pass on intergenerational wealth to your children.

Marketing Question for Financial Advisors:

What investment in prospects or clients could I make now that I would expect to pay off again and again over the long term?

For your own Toyota-like financial advisory practice you can start with the Client-Attraction System. Or you can contact Shirley Hanson at 215-753-2620 to find out more about planning for long-term growth.