"If it ain't broke, don't fix it" might work for some industries, but in financial advisory, this mindset is a recipe for stagnation. The truth is more provocative: If your client service model ain't broke, fix it anyway.
Dr. Noriaki Kano, a leading client satisfaction researcher, developed a model that explains why practices that rest on their laurels inevitably fall behind. His insight revolutionizes how we think about service delivery: client expectations constantly evolve, and yesterday's premium features become today's basic requirements.
The Three Levels of Client Expectations
The Kano Model identifies three distinct types of client requirements, each playing a different role in satisfaction and loyalty:
Basic Needs (Table Stakes):
These are fundamental services clients assume you provide. Investment planning, 100% accuracy, integrity, expertise, and timely communication fall into this category. When present, clients barely notice. When missing, they create major dissatisfaction. You can't win with basic needs; you can only lose by failing to meet them.
Performance Needs (Competitive Sustainability):
These are services clients explicitly expect and compare across advisors. Financial planning, retirement planning, asset allocation, performance reporting, and written service promises fit here. Better performance directly correlates with higher satisfaction. This is where many advisors focus their differentiation efforts.
Excitement Needs (World-Class Excellence):
These are unexpected delights that create genuine excitement and surprise. Family education sessions, integrated wealth statements, financial organizers, concierge services, and coordinated professional team management represent excitement factors. Their presence dramatically boosts loyalty; their absence doesn't cause dissatisfaction because clients don't expect them.
The Evolution That Threatens Your Practice
Here's the critical insight that separates thriving practices from struggling ones: Services migrate from excitement to performance to basic over time.
Think about banking. Twenty years ago, 24/7 online access was revolutionary, an excitement factor that delighted customers. Within a few years, it became a performance factor that customers compared across banks. Today, it's a basic expectation. Banks without online access aren't even considered.
The same evolution occurs in wealth management. Services that positioned you as innovative three years ago are now expected by most clients. Online account access, quarterly reports, and annual reviews have moved from excitement to basic. Financial planning software, tax-loss harvesting, and estate and tax planning coordination are rapidly shifting from performance to basic.
The Pace of Change Accelerates
Consider this perspective on technological advancement: Early humans took millions of years to master basic tools like fire. Modern humans landed on the moon just 66 years after the Wright brothers' first flight. That same accelerating pace affects client expectations in financial services.
Technology, software capabilities, and competitive offerings continuously raise the bar. What took five years to become standard a decade ago now shifts in 18 months. AI-based technologies now provide tax planning, estate planning, portfolio risk assessments, and spending guidelines, services that were premium offerings just years ago.
The Proactive Advantage
Excellence isn't about waiting for things to break before fixing them. It's about constantly innovating and improving service delivery before issues emerge. This proactive approach separates exceptional practices from merely good ones.
Ask yourself: What services are you providing today that delighted clients last year but are now simply expected? What new excitement factors are you developing to replace them? If you can't answer these questions, you're already behind.
Continuous Improvement as Strategy
Walt Disney understood this principle: "Do what you do so well that they will want to see it again and bring their friends too." Excellence isn't a destination; it's a journey of constant improvement.
To maintain client loyalty and attract new business, you must continually create new elements of delight through strategic updates to your service model. This doesn't mean abandoning what works; it means building on your foundation while systematically elevating the experience.
The practices that thrive aren't asking, "Is our service good enough?" They're asking, "What could we do better? How could we enhance this process? What's the next level of service we could provide?" This mindset, pursuing excellence even when things are working, differentiates growing practices from stagnant ones.
This is the second in our series on creating unshakeable client relationships. Next, we'll explore the Six Core Client-Facing Processes, your blueprint for delivering consistent excellence that transforms satisfied clients into loyal advocates.
Want to assess where your services fall on the Kano Model? Let's discuss how to keep your practice ahead of evolving client expectations.