The Carson Group team spends hundreds of hours each week working with advisors to improve their businesses. While no two advisors are exactly the same, it might surprise you that most advisors struggle in the same three areas: Growth, Efficiency and Client Retention.
Recently, we asked our Carson Group Executive Business Coaches to tell us how they help advisors solve these top three challenges. Hear how our leading practice management coaches find strategies for success for advisors.
Challenge #1: Growth
Think back to the beginning of your career. What was your criteria for accepting a new client? If you’re like most advisors, you probably worked with just about anyone and everyone when trying to get your footing in the financial industry. But, as your business matures, your growth is dependent on a much more purposeful approach to acquiring clients.
So, why are many advisors inching along instead of experiencing exponential growth? It’s because they’ve often failed to hone who their ideal client is and how that client is served by their firm’s core value proposition. They are stuck haphazardly collecting the wrong clients rather than refining who they serve and how BEST to serve them.
The Strategy for Success
When looking towards your next phase of growth, Catherine suggests asking yourself the following: Who are my top clients? Where did they come from? Why are they my top clients? How can I best serve these clients? Answering these questions honestly can lead to what she calls an “ah-ha” moment.
Segmenting clients is not just about high AUM, she warns. Consider other factors such as their likeability or their willingness to take your guidance. Then, once you’ve found the shared traits of your top clients, create the ideal value proposition to attract that audience and start searching for those who fit this profile.
Often, asking for referrals from existing A+ clients or creating an advisory board with top tier clients can function as a great introduction to others who could benefit from your services. Finally, consider whether you have systems, processes and people in place to facilitate growth versus being mired down in the day-to-day operations of running a business.
The most important thing to remember as you look to grow your firm is that growth and balance are not mutually exclusive. It is possible to build a thriving practice while pursuing all of your passions inside and outside of the office. Ron calls this the “Sustainable Edge.”
Through our coaching and partnership programs, he’s found that those we can help grow at a rate of at least 15% annually have the ability, confidence and power to prosper, allowing advisors to enjoy a life that is full of the relationships and rewards that really matter to them.
Challenge #2: Efficiency
“No advisor wants to work more hours. Since you can’t create more time, you must reallocate what time you have.” – Scott Wood, Carson Executive Business Coach
Across the country, the hours we spend at work are rising each year. Data gathered from Gallup’s Work and Workplace poll shows that in 2017 45% of U.S. adults log over 45 hours a week, and advisors are certainly no exception. In an industry that’s always changing, it seems the natural way to combat chaos is to come in earlier and stay later, sacrificing the balance that you stress to clients and seek for yourself.
Whereas advisors rarely fall short in initiative or work ethic, they often admit to having poor time management skills. Thus, it’s not a lack of effort, it’s a lack of efficiency that plagues our profession. In fact, statistics collected by Advisor Metrics and the 2014 Global Survey of Financial Advisors suggest wealth managers spend 41% of their time on administrative tasks and another 20% of their time managing investments.
Failure to carve out and budget time for your dual roles as an advisor and as a CEO means that each household you add and each stakeholder you hire will ultimately contribute to longer days and reduced efficiency if you don’t streamline your business processes.
The Strategy for Success
There are two key ways to make the most of your minutes, Scott says: 1) get as granular as possible with your time and 2) improve your systems & technology. To get granular with your time, use your calendar as a productivity partner, blocking out periods of time that are dedicated to particular projects. Then, when the clock strikes, stop everything you are doing to concentrate solely on what is at hand.
Your team will be a valuable resource in this process. First, they can aid you as you separate your Should Do List (i.e. advisor-specific responsibilities) from your Can Do List (i.e. all responsibilities within the firm). Everything that appears on the Can Do List needs to be delegated to an appropriate stakeholder, deferred to a later time or deleted entirely.
Once you narrow down your much-shorter Should Do List, form standards that enable your team to protect your time when flow interrupters – such as client calls – threaten to pull you away.
Improving efficiency and productivity through the use of systems, processes and integrations among your technology tools will further streamline how and where your time is divided, potentially regaining the up to 61% of time you currently spend on administrative and investment tasks. Rethinking the inner workings your business is never an overnight fix, but investing the energy into finding the right solutions and partnerships will net many positive returns.
Challenge #3: Client Retention
According to the October 2014 article The Value of Keeping the Right Customers by Harvard Business Review, bringing on a new client is anywhere between 5 to 25 times more expensive than maintaining a relationship with an existing client.
Alongside these clear budgetary advantages, those who excel at retention typically benefit from more referrals and are more effective at forging connections with the next generation of a client’s family. Despite the desire to be truly client centric, however, many advisors have difficulty reframing their mindset from gaining to retaining.
Much like Challenge #1, the beginning stages of an advisor’s career are so concentrated on forming a client base that once it’s built they can’t easily make a shift. The instinctive tendency is to generate income for the firm by constantly bringing in new people instead of realizing the immense value of simply nurturing current clients. Unfortunately nearly half of clients report they’d be willing to leave their current advisor according to research by Credit Suisse. What are you doing to keep 40% of your current assets from walking out the door at any given time?
The Strategy for Success
The first step to increased retention is defining your client experience. Amy recommends a communication strategy with plans for regular, consistent outreach that wows clients from the moment onboarding begins.
For example, at Carson Group partner offices, this ongoing communication includes: weekly market commentary; monthly planning newsletter; quarterly market outlooks; special communication on newsworthy market events; reports from the investment committee; trade notifications; drip email campaigns; follow up items and completed tasks for advisor and client; allocation changes; updates to financial priorities and goals.
Additionally, our partners are continually sharing educational content, such as blogs, whitepapers and fact sheets and hosting educational client events. Remember, every client deserves great service, but often this does not equate to equal service. Segmenting will help you decide which groups receive which types of client touches and allow you to personalize for your unique client segments.
Amy’s final piece of advice is to recognize your own strengths. If your forte lies in rainmaking, it may be wise to hire a stakeholder whose role is to cultivate relationships to ensure your firm keeps those valuable clients you bring in.