Detroit—“We’re in a growth mode, but I know we’re not close to reaching out potential,” Chris explained to me while his partner Dan shifted uncomfortably in his seat. “I think we need to reassess our entire operation, especially our junior advisors.”
This led to an insightful conversation about their team’s infrastructure, personnel strengths and weaknesses, and what they thought was the biggest challenge keeping them from their potential. From my vantage point, it became obvious that Dan was the key. He was a rainmaker, had personally brought in $15 million the past year, and had what sounded like unlimited access to people with serious money. However, his uncomfortable body language as this conversation unfolded signaled the beginnings of an honest self-assessment.
I began by asking questions revolving around business development:
· How much time are you (both partners) spending schmoozing with your top clients?
· How much time are you schmoozing with your referral alliance partners (CPAs, attorneys, etc.)?
· How many opportunities can you think of (affluent prospects) that you’ve yet to ask for their business?
· How would you describe all the moving parts (personnel) of your team?
· How much time do you spend managing these moving parts?
· How much time are you (both partners) spending with your junior advisors?
· What activities do you find yourself engaged in that are interfering with you (both partners) spending time with your top clients and top prospects?
Everything became clear as Dan began to describe the makeup of their team. They had recently hired their intern, an MBA student, as the practice manager, joining their two assistants and four junior advisors. It looked quite impressive when Chris pulled out the team’s organization chart. But they were dealing with a lot of moving parts, and not all of them were pulling together. It was no surprise that a tremendous amount of time was being devoted to managing and helping these junior advisors.
After listening and reviewing their org-chart, I made the comment that it appeared that only three people were key to the team reaching its potential: the two senior partners and the most senior junior advisor who had become the team’s resident CFP. After an uncomfortable silence, they agreed. At least 95 percent of their $3.6 million in annual revenue was dependent upon Chris and Dan. And without their planner, they couldn’t deliver the high-quality wealth management solutions they currently provided their affluent clients.
Here is where the mantra less is more enters into the picture regarding team org-charts. Every moving part needs to be connected to the long-range vision of the team. For Chris and Dan, they wanted to grow but hadn’t zeroed in on a long-range vision. When I asked what their potential could be if they were able to free themselves of all distractions and hit on all cylinders, they looked at each other and replied in unison, “We should be a $10 million shop.”
Using this figure as their vision (although I’m not sure it’s official), I took them through a quick exercise of linking every moving part illustrated on their org-chart to achieving the high-water mark of $10 million. The discussion quickly turned to leaving the junior advisors to fend for themselves; if they stumble onto a big opportunity, fine; if they make it in the business, it’s up to them. The role of their two assistants had to be revised since the leaders they were spending too much time supporting the junior advisors and smaller clients. They needed to embody the concept of delivering Ritz-Carlton quality service with a FedEx level of efficiency to their top clients. They also needed to help Chris and Dan organize social interactions with their affluent centers of influence.
Their practice manager had potential but was green and required time and attention. They determined that their planner would be responsible for getting the practice manager up to speed, and they would oversee the process. In less than 30 minutes, Chris had ripped up their org-chart since they had agreed to reassess the junior advisor role and revamp everyone else’s role. Less is more.
In that spirit, reflect on your financial practice starting with your long-range vision (business plan) and answer the following questions:
· Have you truly committed to your long-range vision? (Do you have one?)
· Are your annual goals directly linked as a stepping stone to your long-range vision?
· Are you (team leader, senior advisors) spending the majority of your time engaged in activities directly linked to your long-range vision?
· Is your role within the team (practice) directly linked to your long-range vision?
· Is every team member engaged in activities directly linked to your long-range vision?
· Is every policy and procedure linked to your long-range vision?
· Are all of your current clients congruent with your long-range vision?
Assuming you have a long-range vision that you’re committed to, every negative response to the aforementioned questions is an indicator that you will likely benefit from a form of streamlining—less (team members, smaller clients, etc.) being more effective. Whether it’s junior advisors who aren’t contributing, ineffective procedures, service models for non-revenue generating clients, or simply too many smaller clients, in today’s challenging times it’s important that advisors continually strive to improve the efficiencies within their practice. “Less is more” means more time spent on relationship management and relationship marketing activities with today’s affluent.
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