The Trusted Advisor Relationship

Why it matters. Earning the distinction.

Ask experts, clients and consultants to define “trusted advisor,” and while there is fairly broad consensus in their answers, each perspective on what it means, why it matters, and how to achieve and receive the services of a trusted advisor provides nuanced insight to a coveted status and essential service.

What is a Trusted Advisor?

David Butter of Andrew Sobel Advisors describes the transition to trusted: “You need to evolve from being an expert for hire, somebody dealing with transactions and short-term projects, to building a client for life.” Butter describes a “long-term, trusted relationship which goes beyond your core subject matter expertise into being a partner in helping deliver the client’s personal and institutional agenda.”

Luiz Carlos de Queiroz Cabrera is Managing Partner, Panelli Motta Cabrera in Brazil, and the 2011 winner of the AESC Lifetime Achievement Award. “The atmosphere is trust—the main issue is trust.” This atmosphere he describes extends beyond an assignment. “The trusted advisor helps clients to think, gives a different point of view, and excites them to look at different angles: How can I talk about succession, M&A, investments, buy or sell?” he says. “Sometimes, what they want from you is just a logical discussion.”

For one client of search, empathy and experience are vital features of the trusted advisor. Ulrich F. Ackermann, Vice Chair of the Board & Chairman: Europe at TRANSEARCH, Germany says, “What is important here is that you, as a consultant, have to understand how the CEO or the person that sits in the client chair feels. Ideally, you’ve been in his shoes and have experienced what it means to be in such a situation,” he says. “If you have this understanding and you have the rapport with the client, you have two fundamentals to become a trusted advisor.”

For Krista Walochik, AESC Board Chair and co-founder of Talengo, “A truly trusted advisor is someone who puts the other party´s best interest first. It requires independence, ability to form a criteria-based opinion, active listening skills and empathy, a service orientation, and the courage to challenge and say 'no' from time to time.”

A truly trusted advisor is someone who puts the other party´s best interest first.

“Within our profession,” Walochik says, “this may include: Probing on possible internal candidates before jumping on a search; challenging a brief when the profile is unrealistic; turning down an assignment when you know you´re not the best equipped to handle it.”

A C-level advisory relationship can be high-stakes for the client. Christoph Szakowski, Partner-Consultant with boutique international logistics solutions provider LCE—Poland, believes independence is an essential quality for a consultant. “First of all, to be a trusted advisor you need to be outside of the internal company politics, you need to be neutral, having your own opinion and judgment without the influence of any stakeholders in or outside the company.”

Szakowski also observed that “clients value openness, neutrality, and some personal traits. You need to be authentic, you need to be able even to criticize yourself, to be self-aware about your own weaknesses. You show you are not somebody who doesn’t make any mistakes. I believe leaders follow advisors who admit they make mistakes, but learn the lesson,” he says.

Russell S. Reynolds, Jr. is founder and chair of RSR Partners and an AESC Lifetime Achievement Award winner. “It’s not about money, it’s about commitment,” he says. “We have worked very hard over the years to build that relationship with a number of our clients, and the ones who seem to have emerged as the best clients are the ones who feel that we really are a trusted advisor. So to be a trusted advisor is to do the right thing in the long run and not the best thing in the short run.”

Robert Pearson is founder and chairman of Pearson Partners International, and an AESC Lifetime Achievement Award winner. “When I was CEO of a public company, I would have conversations with the CFO that I could never have with anyone else in the company. For me to have those conversations with an outside vendor would be very difficult—I wouldn’t do that unless I had spent a long time developing and nurturing the relationship. And it probably takes an extended client relationship before you can call it a trusted relationship.”

Not every relationship rises to the level of “trusted advisor.” With his storied career at the highest levels in the profession, Pearson says “I can honestly say that I don’t have scores of trusted advisor relationships.” He explains “It’s something that needs to be nurtured and treasured, and I would not imagine that a person could have more than 5, 6, 7, maybe 8 trusted relationships in the course of a career. It takes time to develop, it’s easy to destroy, and it’s very hard to have multiple trusted client relationships, because you spend a lot of time with that client.”

From the client perspective, a trusted advisor can be found at the far end of a journey. Lalit Jain is CEO for International Solar at Hindustan Power, a power development company in India with a large presence across India and strategic international markets. In business relationships, Jain proceeds with caution. “I don’t know a scientific or structured way of finding a trusted person. We start small, we see how comfortable they are, how flexible, how good they are, when we start the relationship,” he says. “It builds over time. There’s no mechanism to do that. We try to evaluate honesty, integrity, experience, reliability. Most important is one’s own experience. It’s gradual.”

Why it Matters

The placements, the assessments, and the full range of advisory services are high-stakes, important work for both the client and the consultant. But beyond the scope of work, both clients and consultants value the relationship between them.

JoAnne Kruse is Chief Human Relations Officer at American Express Global Business Travel. She describes the immediate advantages of working with a trusted advisor. “They know the organization, they understand the culture and the dynamics of it, and that gives us a much higher confidence level. It takes a lot of time to educate a search person who has never worked with you. Time is of the essence and fit is super critical. That’s something that’s always going to help the person who’s got that trusted advisor relationship.”

“The other piece is that a really trusted advisor will tell you if they can’t do that search.”

For Peter Drummond-Hay, retired Managing Director at Russell Reynolds Associates and AESC Lifetime Achievement Award winner, 2017, the trusted advisor relationship is unencumbered by doubt and uncertainty. “Clients feel there is somebody who knows them and will give them honest advice,” he says. “It’s such a privilege if we have someone in our lives we can share with at that level—the value is, the client doesn’t have to be suspicious of the motives of the person advising them.”

Clients also need counsel under pressure. AESC Lifetime Achievement Award winner Judith von Seldenek, Founder and CEO of Diversified Search/AltoPartners observes “everybody’s in such a hurry for everything, including making decisions. Some of the decisions clients make are life-changing, corporate direction-changing, and they shouldn’t be made in a vacuum,” she says. “But they’ve got to make them, they can’t take forever to make them and so they need to have people that they could call and ask questions. These are key people and hard to find, and they develop over time.”

Corporate leadership is also under constant performance pressure, which can leave executives wary of exposing doubts or vulnerabilities. “If you look at the guys at C level, if they have to openly discuss their ideas, their fears, and their expectations, with whom should they discuss that?” Ackermann asks. “They cannot discuss that with their board colleagues because, quite often, they are not sure whether one of their colleagues will use this as a sign of weakness, or use this for his own purposes. Which is why it its difficult for a CEO to find somebody to serve as a sounding board among his peers.” The trusted advisor frequently serves in that role, as someone outside the organization but with deep understanding of the business.

The trusted advisor helps clients to think, gives a different point of view, and excites them to look at a different angle.

Cabrera adds, “A known subject is how lonely the CEO is. We have been discussing the loneliness of the CEO for a long time— but this is a very important role that a trusted advisor represents for a CEO, especially if it’s a new CEO.”

“For CEOs,” von Seldenek says, “if they can find the right search consultant at the right level it’s an invaluable resource in terms of helping them to make good business decisions—and the most important decisions today are around human capital.” Indeed, in AESC’s 2017 client survey, attracting and retaining top talent ranked high among executives’ concerns.

As the global talent shortage shows no signs of abating, it remains an urgent problem for many organizations. “Talent is the name of the game,” von Seldenek says, “and if you get that right you’re off to the races; if you get that wrong, it can be the end of the day. Good search people understand that equation better than anybody.”

Hindustan Power’s international solar business requires advisors with language skills, cultural proficiency and business competencies in the specific markets where Jain has projects. He relies heavily on local advisors. In fact, Jain says, the success of his business depends on them. “Without such relationships we will fail in various markets,” he says. “The UK market is very different from the German market, the German market is very different from the Italian market, the European market is very different from the Japanese market. Culture, language, the way of negotiating documents and various matters are completely different and we need to have people we trust who can help us.”

Clients in family-owned businesses have a specialized need for independent advisors. Cabrera describes business in Brazil. “Most of our companies are not corporations. We have listed in the stock exchange 443 companies. We have only seven corporations. All the other companies are family owned or a combination of family and investment funds. So, the major problem for those companies is succession, especially when you have two families, or two good candidates in the same family.”

Succession planning in a family-owned business could be divisive, and if contested, potentially catastrophic. “What the board wants to discuss with the trusted advisor is how to conduct the succession process,” Cabrera says. “Your value is, they know you can be independent, you are not going to work for one side over another. And sometimes the trusted advisor represents the opportunity of the company to look externally—to be sure that the internal candidate is the best.” He adds, “That’s why search consultants became a very important trusted advisor in the succession process here.”

Asked about why a trusted advisor relationship matters, Butter is unequivocal. From the client perspective, he says “clients in this fast-moving world are desperately seeking people they can have insightful conversations with—rather than receive presentations and me-too recommendations from—people who can be a sounding board, people who can sit at the table and listen, ask insightful questions, and offer independent strategic advice.

There’s value on the consultant side, as well. Butter says, “if the consultant stays in their expertise, task-oriented box, they’ll get an assignment, they’ll deliver the assignment, but then the relationship will stop. They are much more likely to be stuck in RFP territory, bidding on price, working at the middle level.” He says, “when you apply skills and techniques of building the trusted advisor relationship, you are much more likely to become a sole-provider, much more likely to avoid day-to-day price pressures, and much more likely to have a client for life.”

Reynolds illustrates the point with an example from his own experience. “’One time I asked a very distinguished man, John Laudon, who was chairman of Royal Dutch/Shell, if he would go on the board of my first firm. He said ‘well what do you expect from me, new business?’ and I said ‘no, friendship.’ He finally decided we would try each other out for a year and about 18 years later we were very, very close friends.’”

How to Be a Trusted Advisor

The status of “trusted advisor” for many in the consulting and advising world is aspirational and elusive. It depends, in part, on experience, character, commitment, knowledge, and chemistry.

Reynolds understands the investment required to develop a relationship with a client. He advises, “Be willing to spend a lot of time with the client to get to know them, get to know the people, travel, visit their offices, so that by the time you do a search for them you almost know the company as well as the client does. Some clients will say ‘that’s not necessary, we don’t have time to invest in a lot of meetings. Get it going and get us a person.’ That’s a transaction.” Reynolds adds, “The people who are willing to have you attend a board meeting or visit their plants or go to their sales meeting, those people are building a relationship.”

As a client, Jain feels “the beginning of the relationship is very critical. My advice: make sure that the consultant advisor tries to deliver more than has been asked for, try to give a value-add, try to give input in a concise manner, those things help.”

He says, “being available, on-call, understanding what is important to a client, these things help. And then, as a client I want to make sure that our interests are aligned, and that we’re looking at the bigger picture. These are some things advisors can do to build a long-term relationship.”

Walochik says, “There are different elements involved in being a trusted advisor: content expertise, strategic vision, knowledge of specific business drivers, understanding organizational dynamics and culture, and a breadth and depth of personal experience on which to draw.” She observes, “A trusted adviser gains that honor over time and on the basis of different interactions that have generated positive results for the client.”

A Trusted Advisor is somebody who you believe will give you good advice without consideration for commercial gain.

Cabrera, too, believes that a trusted advisor relationship is built over time. “It does not come immediately. We have in the Brazilian culture a saying, ‘to build that trust you have to eat one pound of salt together.’ To eat one pound, it will take a long time.” He adds, “You don’t introduce yourself as a trusted advisor— it doesn’t work like this, you become. It is the consequence of a long-term relationship.”

“You really have to earn this trust,” Ackermann says. “And that means you don’t earn it once and then you have it forever, you have to earn this every time you’re sitting together with your client, that you’re talking with your client because you have to rebuild the trust and reinforce the trust, and you have to give added-value to your client.” He adds, “It’s a question of how respectful you behave, that you keep that absolute confidentially and only use information for the benefit of your client.” He says, “In the long term, you have the possibility of influencing the strategic orientation of the client and helping them improve in the broadest sense: improve personally, improve as a company, improve in terms of talent management, and finally help them shape the culture to the next dimension.”

Kruse describes an advisor who, even outside of an engagement, may come back to her with important market information. "There is real value in having an advisor share best practices or trends, particularly when they share how other companies or candidates are handling these trends." She adds, “that creates a value in my relationship with them, and a recognition by the advisor of literally how to be a great partner for me, beyond the transactional value of doing a good job filling a job.”

For Szakowski, “The relationship is not a question of what I can tell them, or even which solution to offer their business or their clients. No, it’s a little bit more—I can help clients become better in business, and also in their lives. I have some leaders who I serve, and they call me in a trustful way and discuss different topics with me—it’s not always strategic, operations management or company development matters, sometimes it’s a truly personal matter.”

Some relationships are forged under pressure. To Cabrera, “You become a trusted advisor when you face a lot of challenges together with your client. The challenge could be the death of a CEO very young with no succession plan, could be a disruptive technology that’s effecting the business. The challenge could be to replace a CFO in the middle of an IPO program. Competencies are only developed by facing a challenge, and when you face a challenge together, you develop competencies together—and then, he or she client knows that you know how to face that situation, because you were there with them.”

Cabrera adds, “We must be careful with the word 'experience,' because sometimes it’s not a success, it’s a failure. But you face it together. You learn with a failure.”

A challenge that seasoned consultants understand is the need to take risks. Von Seldenek explains, “I have had to disagree— not just for the sake of disagreeing, but that’s where you add value. If you see something that isn’t being handled in the right way, or the right questions aren’t being asked, you have to speak up,” she says. “You’ve got to be willing to lose it all.”

It takes time to develop, it’s easy to destroy, and it’s very hard to have multiple trusted client relationships, because you spend a lot of time with that client.

Von Seldenek speaks of the courage of convictions “and if you think what you’re hearing from your client is not the right way to go, you need to tell them.” She says, “That’s what you’re getting paid to do.”

Pearson also advises on what not to do. “The biggest mistake anyone can make is to go into a meeting and say ‘what keeps you up at night.’ It’s an absolutely dumb and irrelevant question. You should have figured that out long before you go into the meeting.” He says, “You need to spend a lot of time understanding the client. There’s a wealth of public information available, so you need to find out everything there is to know about that company: its challenges, the problems they’ve had, the growth they’ve gone through, the previous executives who have left and under what circumstances. So when you go into the meeting, you have a pretty good idea of what keeps them up at night. What you want to talk about is what are the opportunities going forward, and how you can help.”

Human relationships are unpredictable, even in business, and even if a consultant does everything right. “I think a good consultant will undoubtedly develop these relationships overtime,” says Drummond-Hay. “I’ve been fortunate in my career to have a good number of trusted advisor relationships with different people, and we’ve been able to relate. But that’s not always the case. Chemistry is really important. It’s not just knowledge and substance, the client may just not like the sound of my voice.”

How to Have a Trusted Advisor

Clients who have relied on trusted advisors note the practical benefits of the relationship, and the role their own behaviors played in enabling such relationships to evolve.

When Christoph Szakowski was contemplating a career change, his trusted advisor helped him look beyond work. “I had a rather fast progression in my management career, from junior manager to general manager in the international logistics industry, and I was quite satisfied. But it was not everything, and I was starting to think about how to change and prioritize my personal life versus my professional life. I needed advice.”

Without an existing advisory relationship, Szakowski chose to seek one with a specific skill set. “I was really lucky at that time. I realized I needed to ask for advice. I didn’t want to ask somebody in the logistics industry, I didn’t want to ask a coach, I wanted to find someone who could combine psychology with business knowledge and a broader perspective.” This advisor broadened my horizons, and suggested I consider the structure of my life, my long-term goals, and doing something different and new. All those things, which before that, I didn’t really think about.” Szakowski elected to be open to an advisor.

For Jain, being open to advisors is a deliberate choice, as well. “Our business is based in India, but we’re working outside India so for us, these advisors are an extension of our team. I think now the relationships have developed to the extent that there comes a point when we don’t even differentiate between our team and the advisors.” Jain adds “and our explicit objective is to ensure that we develop such relationships.”

By choosing to invest time and trust in their advisors, both Szakowski and Jain have gained tangible benefits. “It’s very difficult to have a trusted relationship if we don’t show trust,” Jain explains. “If we don’t show long-term interest in working with advisors, it will not develop into a trusted relationship.”

According to Butter, both the client and the consultant play a role in developing the deeper, trusted advisor relationship, “but it’s up to the consultant to take the initiative.” Butter acknowledges, “Sometimes the client is hard to break through to, but you’ve got to add value in the relationship, and build some personal and professional rapport before you can begin earning the right to becoming a true partner and trusted advisor.”

Asked about the client’s role in developing a trusted relationship, Kruse says “as a client you hope that the consultant brings that to the table. But some of it is how you, the client, thinks about those partnerships in the first place. If you start off thinking it’s a partnership, then you have to provide access and information, and most companies are pretty protective of that, certainly in HR.”

Why are some clients reluctant to provide that access outside of a trusted relationship? Kruse says, “People have been burned, so you have to have a pretty trusting relationship to disclose your dirty laundry to somebody who talks to a lot of people externally. It’s high-risk for the company. The political environment of potentially having something communicated that would be damaging to either individuals or the brand – that’s why people are so hesitant.” Kruse adds, “But it’s a chicken and the egg kind of thing. If you don’t build the rapport and you don’t have the experience with people over time, you never get to that trust level.”

Butter says what Szakowski and Jain know from experience. “Open-minded clients understand that it is in their enlightened self-interest to build these relationships with their advisors. The advisor can add more value in the context of a long-term relationship, and the trust that develops eliminates much of the friction of working with outside providers. They also gain deep personal understanding and support.”

When Do You Know?

Consultants and clients recognize that the evolution from consultant to trusted advisor is both exceptional and infrequent, and they know it when they see it.

Drummond-Hay recognizes “another level” in the professional relationship. When achieved, he says “there’s a dimension in which you are advising the client above and beyond the thing they’re working on: their career, their dealings with management or the Board; being in a position where the client can open up about things that are personally important to them. From the client’s point of view, having that kind of relationship is tremendously valuable.”

Von Seldenek recalls talking to a CEO not long ago who founded a Fortune 500 company. She says, “He had engaged me to help find somebody for his board and it was a tricky situation. I could tell he was sharing with me just bits and pieces, and he was watching me and reading how I was reacting. As he continued on, he was deciding in his mind how much he could he tell me. In the end he was forthcoming and really shared what I needed to know: the culture and the dynamics. Then when he shifted, and started talking about personal things from his perspective, I realized we had crossed a line. A good line.”

While not a search consultant, Jain recalls a contract negotiation in which he was advised by a local law firm to “trust the counter party and go by verbal assurance.” With trepidation, he followed the advice of the law firm and “because we went with the advice of our lawyer we were able to control the price, and it became a very important relationship, and we use them for all our projects without any questions asked.” He says, “Over time we became very comfortable with the firm, we allow them to negotiate our contracts, and trust them completely to continue our standard.”

Jain remembers that his company had to earn the trust of the firm, as well. “There was some apprehension on the part of the law firm, because we were coming from outside Germany. Would we pay their rates? Would we pay on time? Over time they became comfortable with us,” he says. “It’s difficult to say what leads to 'trusted advisor,' but I think its experience from both parties with each other.”

When Szakowski started as a consultant and interim manager, offering boutique solutions to the logistics industry, he knew that becoming a trusted advisor “required more skills and another attitude—and it is hard.” Eventually, “a few clients became so deeply involved that they call me to ask my advice. I started to ask about goals, about personal issues, and as there was trust they started to articulate different issues and different challenges. And I realized I could be a trusted advisor while I managed one thing: I closed myself to thinking, ‘I am a solution provider.’ I need to be a partner—an eye-to-eye discussion on the same level.” He says, “If I can help to change people’s mindsets, they might be able to drive transformation in their companies.”

Stakes and Rewards

Organizational leadership is fraught with risk for advisors and for clients: the risk of a bad placement, the risk of a bad decision that hurts the client, the share price and the employees. And the rewards are high, as well: the challenges, the opportunities, and the relationships.

“The stakes are high for clients,” Drummond-Hay says. “Recruiting is a very high-risk process for executives. Making the wrong choice, failing to make an appointment, those things can be very damaging to someone’s career. Our job is to reduce the risks that the company faces and the individual client faces, then we’re on the way to becoming that trusted advisor.”

Our job is to reduce the risks that the company faces and the individual client faces, then we’re on the way to becoming that trusted advisor.

Consultants welcome the privilege of helping clients set strategy, solve problems, build their businesses and shape their careers. The downside? “You cannot go on a roadshow telling people you have been the trusted advisor of this or that CEO—those people don’t like it,” Ackermann says. “This is why it’s rather like consulting under the radar. That happens quite often in evening dinners, talks, where you sit with them for a couple of hours and nobody knows what you’re talking about. There are no minutes.”

Von Seldenek is still working with her Fortune 500 client. She says, “Our relationship has grown and I’m doing a lot of work for him, now. And the thing about my industry, what really makes it all worthwhile is when you can have a relationship with a client who has been so incredibly successful that he doesn’t take many people into his confidence, but has decided there’s something you can do to help him make some very important decisions.”

For Walochik, “Like any relationship worth its salt, this requires caring and taking the time to nurture it. On a very basic level, this is knowing what´s going on in the client´s business and market, and how she is affected by it. It also means offering insights and market information on a regular basis.” For example, she says “Recently I introduced two clients to each other because I identified that they may have common business interests.”

There is a clear business interest in earning the distinction of “trusted advisor.” Pearson explains “We are not a name brand, so we don’t get a call when somebody is thinking about doing their first executive search ever. Trusted relationships are important to us, because when somebody does call, 75% of the time the business comes from either one of two sources: existing clients that have referred business, or sources that we’ve used in the executive search process who noticed, and remembered how we conducted ourselves in the process.”

Business advising is about productive, meaningful relationships. Butter offers some perspective. “We may have hundreds, even thousand of LinkedIn connections, but actually in our careers and in our lives it comes down to a handful of people with whom we have deep, trusted relationships in business and in life. Those relationships, the people with whom you develop your career, tend to stay with you and become the building blocks of your life. There’s nothing more rewarding.”

“Why are we in this business?” Butter asks. “Because in the end, relationships are core to the human experience and what gives meaning to our lives.”

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