Background - tephaniejohnson72.weebly.com · Web viewIt is a multi-level marketing (MLM) company for finance which sells financial products and services using a hybrid model of

THE LACK OF PEOPLE JOINING OR INVESTING IN FINANCIAL SERVICES

The Lack of People Joining or Investing in Financial Services

Agency: Clark & Associates

Tephanie Johnson

Arkansas Tech University

THE LACK OF PEOPLE JOINING OR INVESTING IN FINANCIAL SERVICES 2

I. Student Information

● Name: Tephanie L. Johnson

● ATU Email Address: [email protected]

● Student T#: T01183390

● Current Employer: Southwest AR Education Cooperative

● Current Position: HIPPY Homebased Educator

II. Project Site Information

● Organization Name: Clark & Associates

● Address: 615 S. Mockingbird Hope, AR 71801

III. Stakeholders Information

● Stakeholders Name: Abraham Clark

● Position/Responsibility: Regional Leader

● Email Address: [email protected]

● Strategy for Meeting with Stakeholders: Face-to-Face, email, phone

LIST OF ABBREVIATIONS

BTID Buy Term and Invest the Difference

FAI Financial Assurance, Inc.

MLM Multi-Level Marketing

FNA Financial Needs Analysis


TABLE OF CONTENTS

Background……………………………………………………………………………………… 4

Purpose of Project………………………………………………………………………………. 6

Problem Identified………………………………………………………………………………. 8

Research Methods and Materials………………………………………………………………... 9

Analysis and Findings................................................................................................................... 10

Recommended Action Plan ...........................................................................................................17

References………………………………………………………………………………………..22

Appendix A………………………………………………………………………………………24

Appendix B……………………………………………………………………………………… 25


Background

The organization I am reporting on was founded in 1977 by Arthur L. Williams, Jr., a

former high school football coach who supplemented his income by selling insurance. Arthur L.

Williams opened insurer A.L. Williams & Associates in 1977 in Atlanta, GA, with just eighty-

five agents in one city. (2014 AFE Medal Goes to Life Insurance Visionary, Motivational

Speaker Williams, 2014) He was an insurance executive who lives in Palm Beach, FL. The

company established its base by mass-marketing the concept of “Buy Term and Invest the

Difference.” (BTID) the company illustrated how it's mostly middle-income client base could

purchase sufficient protection with term life insurance and systematically save and invest in

separate investments, such as mutual fund Individual Retirement Accounts. He was initially

established as a privately held general agency, at first selling term life insurance policies

underwritten by Financial Assurance, Inc. (FAI) Williams convinced prospects to switch from

whole life insurance to term policies using swarms of part-time agents. (Forbes 400 > Arthur L

Williams Jr, 2016)

The organization that Mr. Williams founded is one of the largest independent financial

services marketing organizations in North America. It is a multi-level marketing (MLM)

company for finance which sells financial products and services using a hybrid model of direct

selling, franchising, and distribution.

The main mission of the multi-level marketing organizations is to help families become

properly protected, debt free, and financially independent and to achieve the mission, the

company uses a unique business model that is designed to assess each client's’ financial needs.

The sales representatives primarily use the company’s proprietary Financial Needs Analysis


(FNA) tool; an educational approach to demonstrate how the products assist families in

becoming properly protected with life insurance, saving for retirement and other needs, and

managing their debt. In 2010 the organization became an independent company and was traded

on the New York Stock Exchange. (History, 2016)

To determine how the lack of people joining or investing in the organization will impact

the company because it is important to the organization to help their clients in need. More people

are in need of these types of firms; those who offer this type of service to help clients. When a

new representative joins the organization, there are many opportunities to gains. New

representatives will be trained how to educate people on how to get out of financial debt. Over

the years, more and more people are finding themselves in financial debt and unable to save for

the future even though saving for the future is more important now than it was in the past. The

new representatives need to recruit and enroll people who are interested in working hard and

have the mindset to help the people in need. Without representatives joining the organization, we

won’t have clients; therefore, we will not sell products to help the clients. The organization

wants to make sure the representatives who join will have the product knowledge to better serve

the clients’ financial needs.

The stakeholder I chose to interview for this project decided to invest in a business

opportunity to improve his family’s quality of life, in 1989, after hearing about a business

opportunity from a representative of the organization. Mr. Abraham Clark was at the time

working and a student and was searching for a chance for something better. The organization

allowed him to be his own boss while helping families become debt free and financially

independent. Mr. Clark is a regional leader and independent agent of the financial organization

known as Clark & Associates. Mr. Clark is part of PFS Investments Inc. and a registered and a


life insurance representative in the (US). (Clark, 2016) Clark demonstrates as a representative of

the organization the issues of dealing with the lack of people joining and investing in the

financial organization by meanings of trying to recruit representatives and clients for the

organization. Clark has to go out and talk to people on a regular basis and build a clientele to

explain the products and services they have to offer them so they can start to have some financial

freedom.

Purpose of Project

The purpose of this project is to find a solution to how we can help alleviate the lack of

people joining and investing in financial services.

The problem is that most of the clients are generally middle-income families, which the

company defines as households with $30,000 to $100,000 of annual income. According to the

2014 U.S. Census Bureau Current Population Survey, the latest period for which data is

available, approximately 50% of U.S. households fall in this range. The financial needs of the

middle-income market are significant: (Primerica Company Overview)

● Many have inadequate or no life insurance coverage;

● Many need help saving for retirement and other personal goals;

● Many need to reduce their consumer debt; and

● Many prefer to meet face-to-face when considering financial products

● Many are living from pay check to pay check

In the ORC International survey, 843 out of 2015 respondents reported household

incomes between $30,000 and $100,000 and were considered to be middle class. Key findings


from an analysis of the survey data are: Other findings from the analysis of the ORCI survey data

include:

● Older middle-class persons (65 and older) than younger persons (18-34 years) rated

their financial decision-making ability as good or excellent, for example, 56 percent

vs. 27 percent for budgeting one’s income

● Two-fifths of middle-class persons (40%) said they would not seek information or

advice about managing credit card debt, and about one-quarter would not do so for

purchasing auto insurance (25%) and life insurance (24%).

● Few said they would use information and advice from a financial professional for

managing credit card debt (18%) and purchasing auto insurance (13%).

● The least well-educated middle-class persons were the least likely to seek

information or advice. (New Report)

By Clark & Associates being an independent agency in the financial marketing services,

if they do not have a representative to generate the clients their revenue will be drop. Clark &

Associates’ representatives have to generate clients to get paid. No clients mean no company.

The clients in financial need have to be educated about saving for college, investing in

retirement, budgeting their income. As the new representatives are enrolled in the company, they

begin to make contact with the low and middle-class individuals and begin to educate them on

using what they have to meet some of their goals to be financially free. (Clark, 2016)


Problem Identified

The problem that MLM (Multi-Level Marketing) financial services are facing is a lack of

people joining and investing in the organization.

Usually, the lack of knowledge, fear of new investments, and financial training of new

representatives stops new people.

The solution to the problem lead me to the research of the “Credit unions which actively

assist members with their investments, which include CUNA Brokerage Services' more than 240

credit union partners, enjoy better relationships with members, a boost in non-interest income

and the opportunity to educate young people about how to take control of their financial futures.”

(Chilingerian, 2013)

The issues the credit union is having are similar to the issues that are considered a

problem in my MLM organization. “The credit unions are facing the issue of the younger

generations and my stakeholders are dealing with the middle and low-class families.”

(Chilingerian, 2013) However, “the credit unions and financial services, all must first move past

young members' feelings of apprehension and general lack of knowledge about investing and

stock trading. The main issue with Gen X and Gen Y is that they are quite skittish about what has

happened in our country financially, and they are hesitant to engage in much risk.” (Chilingerian,

2013) “Credit unions should first make investment products part of their core missions, and

follow with the strategic marketing of those products. Hosting seminars, partnering with

community colleges and bringing in outside experts to assist with their programs are all effective

ways to get young members on board.” (Chilingerian, 2013)

Another big problem that MLM financial services are facing is the lack of motivation in

the representatives and new recruits.


As with the MLM financial services like my organization that my stakeholder is

involved in, they need to have their members to be encouraged to recruit everyone they know to

join their network. The more people you sign up, the more you can earn from their activity. “You

can potentially make money from all the business generated from not only the people you recruit

but all the people that they recruit.” (Finance Guy, 2015) The consequences of not addressing the

problem would be no money. The company would be in distress and could cause a financial

disaster to the organization; people lives would suffer financially.

Research Method and Procedures

In this section, the analysis techniques and procedures I decided to use was a survey and

questionnaire, as my research method(s).

First, found in Appendix A, is the survey, is my primary way of solving the problem of

recruitment of new members and future clients for the organization. The representatives could

present the survey to present to the customers. They could use this tool to find out the point of

the views of how customers see the organization in a whole. To build a strong organization you

have to know what the people you are serving is feeling about your products. This gives the

representative a chance to show his/her knowledge of the products they are offering.

Second, found in Appendix B, the questionnaire is a secondary method of gathering

information for the organization. These questions would get an insight of how people who may

want to join in this adventure for their future feel about such organization like an MLM financial

service. With these questions you can find out the attitudes of how they see this type of venture

and if they want to experience this type of organization. Every business adventure is not for

everyone.


The way to distribute these types of tools to the community for this type of MLM

financial organization, stakeholders would deal with recruiting new members or clients by using

the survey or the questionnaire which would be done by face-to-face interview, mail and online.

After the representatives have enrolled new members or clients, they would distribute the survey

or questionnaires to the customers to fill out and for those customers already on their list, they

would mail out surveys and questionnaires at random or do phone interviews; to get their input.

Analysis and Findings

The overall purpose of this study is to determine the reason for the lack of people joining

or investing in the organization; to see how this company can tap into additional personnel that

will help fulfill the void of people not joining or investing. The responses that I received from the

survey in Appendix A and questionnaire in Appendix B gave me an insight on what is needed to

become a part of the multi-level marketing services. The individuals I was able to survey were

friends, co-workers, and strangers.

All my surveys and questionnaires were conducted face to face. I received a 100%

response rate of all twenty-five people who took my survey and fifteen people who answered and

completed the questionnaire. All surveys and questionnaires are going to be a part of my

analytical analysis. Business uses a similar process to gain competitive edges in their day to day

operations. In order for organizations to be successful competing they need five capabilities:

hard to duplicate, uniqueness, adaptability, better than the competition, and renewability. There

are five levels for analytics to have maturity: reporting, analyzing, predicting, operationalizing,

and activating. All survey and questionnaire data that I obtain will be the knowledge utilized to

reveal analysis findings. The knowledge that you will utilize in this digital and technology era is

the same process that business and corporation in order to obtain successful edges. All of my


information obtained to perform my analytical analysis will show how some successful

businesses or organizations operated at a more successful rate due to the knowledge that they put

in those who fail to put in like survey and I will support my finding in the surveys and

questionnaires and the data I performed. I will support my findings in the surveys, graphs and

questionnaires I prepared for you. Based upon data and survey results we were able to obtain an

explicit knowledge to formulate graphs, charts, and color-coded data charts that easily convey

and represent both the value of the metric and show which parameters each group may fall in.

This will give all parameters included in the various reports, displays and graphs a visual effect

that is based on the pure scientific analysis.

The main analysis began with looking for an overview on why people don’t invest in the

stock market of multi-level marketing financial services. My information for this survey was

obtained from Bankrate which is a major marketing financial service. Chart 1 below, shows the

breakdown of the reasons for people not investing in the stock market are first 53% simply don’t

have the money. The next, 21% don’t know about the stock market and simply have no interest.

You have 9% of the people that don’t trust using stockbrokers, 7% feel that stocks are too risky

of a business to invest their money into, you have another 6% who offered no reason at all for

investing, 3% were afraid of high fees, and the last 1% of the people in the survey, simply

refused to answer the question. (Claes Bell, 2015)


CHART 1

Don't have the money 53%

Don't know about stocks

21%

Don't trust stockbrokers

9%

Stocks are too risky 7%

Some other reason

6%

Afraid of high fees 3%

Refuse to Answer1%

What would you say is the main reason you don't invest in the stock market?


CHART 2

In Chart 2 above, the assessment tool we used was a questionnaire bar chart. The people

who might become interested in becoming a new representative or a client in the multi-level

marketing industry will be shown in the chart below. Now you will see that Chart 2 reveals that a

lot of people would join a financial service if they had the money. As affirmed before the biggest

reason people did not join or invest in opportunities dealt with the money issue. However, 13 out

of 15 would join the financial services if they had the finances, 9 out of 15 would learn the

business or the stock market, 8 out of 15 people felt being a marketing representative could lead

them to financial freedom, and 10 out of 15 felt the products and services would be something

they would purchase or invest in.

The questionnaire pie chart reflected the percentages reflected on people wanting to join

or invest in these types of financial services. As we demonstrated in Chart 3 below, 32% of the

people would take the advantage of joining the MLM’s organizations. If people had the finances

If you had th

e money,

would you jo

in in fin...

Are you w

illing to

be trained properly

in order t

o ...

Do you th

ink worki

ng as a m

arketing re

prese

ntati...

Are the products

and servi

ces s

omething you ...

If you had th

e money,

would you jo

in in fin...

Are you w

illing to

be trained properly

in order t

o ...

Do you th

ink worki

ng as a m

arketing re

prese

ntati...

Are the products

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omething you ...

0

2

4

6

8

10

12

14

16

13

9 810

13

9 810

2

6 7 5

2

6 75

Questionnaire Bar Chart

NOYES


they would jump into different self-starter businesses, but the situation of the economy, 68% of

the people are less likely take a plunge into this type of business venture. 32% of the people are

thirsty for knowledge and are interested in the learning about products and services, but the

financial part is where they will not risk their finances on a gamble.

33%

23%

20%

25%

Questionnaire Pie Chart

If you had the money, would you join in financial service?Are you willing to be trained properly in order to learn the business or the stock market?Do you think working as a marketing representative can lead to financial freedom?Are the products and services some-thing you would invest or purchase?

CHART 3

In our summary, the key analysis will show an overview of all data collected concerning

people having the potential to join or invest in a multi-level marketing financial organization that

is shown below in Chart 4. The survey report will show an overall analysis based on the research

done on the type of people who are willing to take a part of an endeavor to better themselves. If

they are willing to put forth the effort to work hard and develop the necessary skills they stand a

chance to at gaining a successful life in this multi-level marketing. Based on the survey that was

taken 20 out of 25 people wanted to make extra money and felt they could make money, 18 out

of 25 people were motivated to work, 5 out of 25 people felt the fee were too high. When


entering into a business of selling or purchasing you have to go out and get people that can

benefit your company, we refer to that as recruitment and 15 out of 25 people, felt it would be

hard to sell and recruit people, 13 out of 15 people would take this endeavor on if they had the

money, 9 out 15 people would take the advantage to do any training offered to help them or to

seminars to learn about the stock market, 8 out 15 people felt working as a marketing

representative of this type of organization could better them and lead them into financial

freedom, and 10 out of 15 people agreed that these type of products and services would be

something they would purchase or invest in.

The final results of my findings have determined that 53 % of people would join but

simply don’t have the money to, another 21% don’t have expertise and knowledge to take on

something of this nature to take on the stock market, you have a 9% who simply don’t trust

stockbrokers and have little interest in working with a broker of this type of nature. The last four

percentage that rounds out 100% of the people, 7% stock is too risky, 6% some other reason,

afraid of high fees, and 1 % refuse to answer.

The demographic in people represented in my survey were all from the Hope, Arkansas

area or from the southwestern part of Arkansas. The numbers and percentage reflected were

taken from a well-rounded group of people which make up a good base for the conclusion for my

results to be drawn on.


Chart 4

0

5

10

15

20

25

30

20

5

20

1518

139 8

10

5

20

5

107

26 7

5

0.53 0.210.09 0.07 0.06 0.03 0.01

Survey Results


Recommended Action Plan

From analytical business steps that have been taken to measure the change aspect needed

will be shown through a series of potential business processes that will transform and indelibly

change the results to a solution of the problem.

The recommended consideration of the approach to correct the solution of the problem

will consist of a series of business processes that will be done to fix the problem. The business

process is developing a more optical approach of reaching potential recruits for the company.

This will be done by having free seminars, free training, and a series of functions that will add up

to organizational goals for the business to obtain results. Which will remove the causes of the

problem which intel generates an effective change to the problem, The criteria for successful

implementation of the process will be clarifying what value each process adds to the overall goal

of the organization. In order to stay competitive and meet the changing customer demands the

organization will have to consistently design, deliver, evaluate, and redesign processes that will

increment changes. The solution will have major changes done in a short amount of time.

Radical changes like network organizations, thinking from a cross-functional process,

perspective, and powering individuals in the process. By the company changing their matrix and

processes production cost, cycle time, customer satisfaction, revenues and quality will be

reached.

All of the recommendations in our business processes to solve the problem will change

the company from a low-tier business organization into becoming a more productive operating

business organization. One of the top level multi-level marketing companies that will generate

and continue that exist and rise. The main reason we have applied these types business approach

processes is because they will aggressive improve the goals and dramatically correct problem

We will utilize radio advertising which will reach a broad number of people in the masses that


will help to generate a much larger audience of people for the company. Another one of the

business processes in correction phase one is recruitment this will be addressed by offering free

seminars and free training to all recruits and customers that hopefully join the corporation. Some

other effective ways that are not as costly will be to provide free pamphlets and flyers about the

organization that will be distributed throughout the city. The process mention above should

stimulate more “Word of Mouth” communication throughout the area about the company, which

will generate an effectiveness that will solve problems.

The ones recruited for the organization will do the work along with other up-line

personnel who are already in the organization. The individual who will be affected with from

representatives, district leaders, division leaders, regional leaders, and regional vice president

which are a descriptive of job titles of all positions within the organization. There will be

positive and both negative effects from change taking place, but everyone will be 99% positively

affected by working on new and improve processes to do. The remaining 1% are only being

resistance to change.

In this corporation facilities and equipment are obtain on an individual basis. What this

means is that there is no brick and mortar facility to work in. All individuals must process their

own equipment and facility to work from. This is a professional base business where you are

your own employer, and you set your own standards for how you utilize where you do your

business, what equipment is necessary, and what is necessary to do the project. Due to each

individual carrying their own load everyone accomplished the necessary means the operation of

the company succeed.

Personnel which is affiliated with this organization work at their own convenience and

time. The first phase of the operation begins when you provide the necessary requirements to be


a representative, or when services and products are purchased by consumers. This is completed

when all concerned individuals are in agreement with terms and requirements completed

according to company regulations. The second phase will begin as the processes involved in the

business which involves the recruitment of new individuals, clients who are obtained, and

investors which join the organization. As noted above, the schedule has no effect on normal

operation of this business.

The cost, feasibility, and urgency of this report will provide capabilities where attracting

and retaining employees reduce office space, provides employee benefits more flexibility, higher

customer productivity, and less time, and fewer expenses. Utilizing work production and the

greater performs the new technology reflections are placed on the greater use of business theory.

Your personal involvement in the processes necessary to affiliate in the hard knowledge

responsibilities of the company. That interest will simply equate to your wiliness to learn, grow,

re-train and process an interest in the corporation in order to maximize the return revenue

possibilities. Your startup costs will depend on many factors, including the type of business level

which you desire to arrive at in the corporation. Your startup costs will also depend on how

much you can feasibly handle on your own. The urgency for the processing will be done at a

moderate pace so that all steps are given appropriate recognition and time in order for all need to

be met.

In conclusion, our customers are the backbone to the opportunities that exist in the

company. The better you get at acquiring the skills, the greater reach in the organization you will

have to build your clientele, generate, and utilize income for yourself. Steps to acquiring

customers and providing services will all be marketable. By providing stakeholders with new

information, technical systems, products or services. This becomes a part of integrating change


behaviors and attitudes in the organization. We will have an urgent and compelling reason for the

change needed among teammates. Your vision and strategic plan will guide the changing process

that will take place. The communication strategy will convey the vision. Have short term wins

that provide positive rewards and contribute change from your teammates improve efforts and

change. Productivity and gains have made the company into a credible multi-level marketing

business that has made changes that highlight areas with new behavior skills and processes that

are linked to success. These are the things that the company will utilize to generate its revenue

from:

Term Life insurance

Investments

Auto & Home Insurance

Long Term Care Insurance

Prepaid Legal Services


The following chart summarizes steps and timings of the recommended action plan.

Action Steps By Whom By When

Resources and SupportAvailable/Needed

Communication Plan for Implementation

What needs to be done?

Who will take actions?

By what date will

the action

be done?

Resources Available

Resources Needed

(financial, human,

political, and other)

What individuals and organizations should

be informed about/involved with

these actions?

Step 1:New Business Strategy and

Processes Begin

Company Personnel 1 Year

Free Seminars

FreeTrainings

New individuals

Clients

Investors

All individuals who are part of this

company.

Step 2:Implement

processes and procedures

Training

RegionalLeader 1 Year

Clientele

Investors

New individuals

Clients

Investors


company.

Step 3:Get more people to join or invest

Representatives Ongoing

Free Seminars

Ongoing Training

New individuals

Clients

Investors


company

Step 4:Maintenance of

business strategy change

to insure that goals are reached

All company Personnel 1 Year

Free Seminars

Webinars

Professional Development

Trainings

New individuals

Clients

Investors


company

References

Forbes 400 > Arthur L Williams Jr. (2016). Retrieved from Forbes Media LLC:

http://www.forbes.com/lists/2005/54/DA4B.html


2014 AFE Medal Goes to Life Insurance Visionary, Motivational Speaker Williams. (2014, September

23). Retrieved from Palm Beach Atlantic University: http://www.pba.edu/williams-afe-2014

Chapman, A. (2016). Businessballs.com. Retrieved from Businessballs.com:

http://www.businessballs.com/herzberg.htm

Chilingerian, N. (2013). Helping Young Members Warm Up to Investing. n.p. New York: Credit Union

Times.

Claes Bell, C. (2015, April 9). Did you miss the stock market rally? You're not alone. Retrieved from

Bankrate: http://www.bankrate.com/finance/consumer-index/money-pulse-0415.aspx

Clark, A. (2016). Retrieved from Primerica: http://www.primerica.com/abrahamclark

Dibb, S., & Meadows, M. (2004). Relationship marketing and CRM: a financial services case study.

Journal of Strategic Marketing, 12(2), 111-125.

Dugas, C. (2013, May 5). Middle class struggles to get good financial advice. Retrieved from USA

TODAY: http://www.usatoday.com/story/money/personalfinance/2013/05/05/middle-class-

financial-advice/2090441/

Egan, M. (2015, 03 11). Crisis hangover: Millennials are scared to invest. Retrieved from CNN Money:

http://money.cnn.com

Finance Guy. (2015, May 18). Can You Make Money With Multi-Level Marketing? Retrieved from The

Finance Guy: http://www.finance-guy.net/streetonomic/make-money-with-mlm

History. (2016). Retrieved from Primerica: http://www.primerica.com/public/our-history.html

New Report: Middle-Class Americans Acknowledge Past Financial Mistakes. (2016). Retrieved from

Primerica: http://news.primerica.com/public/news/new_report.html

Primerica Company Overview. (n.d.). Retrieved from Primerica:

http://investors.primerica.com/Cache/1500085547.PDF

Stephen P. Robbins, David A. DeCenzo, Robert Wolter. (2013). Supervision Today! New Jersey: Pearson

Education, Inc.


Training and Developing Solutions. (2001 - 2016). Retrieved from trainanddevelop:

http://www.trainanddevelop.co.uk/

Warrilow, S. (2009-2016). Strategies for Managing Change. Retrieved from www.strategies-for-

managing-change.com: http://www.strategies-for-managing-change.com/herzberg-motivation-

theory.html


Appendix A

Research Survey

Do you want to make extra money becoming a multi-level marketing representative?

[ ] Yes

[ ] No

Do you think a fee of $100 is too high to obtain financial freedom?

[ ] Yes

[ ] No

Do you think you can make money as a representative?

[ ] Yes

[ ] No

Do you think it will be hard to recruit or sell the products and services?

[ ] Yes

[ ] No

Do feel motivated to work in this type of business?

[ ] Yes

[ ] No


Appendix B

Questionnaire

1. If you had the money, would you join in financial services?

2. Are you willing to be trained properly in order to learn the business or stock market?

3. Do you think working as a marketing representative can lead to financial freedom?

4. Are the products and services something you would purchase or invest in?

Documents

Background - tephaniejohnson72.weebly.com · Web viewIt is a multi-level marketing (MLM) company for finance which sells financial products and services using a hybrid model of