Building a successful business is often glamorized in media and pop culture, but the reality is far from easy. Advisors, in particular, know the true difficulty of building a business while simultaneously working in the business. Juggling multiple roles, responsibilities, and priorities leaves little room for error and often leads to less-than-optimal decisions. To help guide you through the common practice management mistakes that come with scaling and growing your business, Puai Wichman has identified the key pitfalls you must be mindful of. You can avoid some of the most common mistakes made in the industry and ensure your business survives and thrives.
Make a clear decision about whether you want to build a lifestyle practice or an enterprise, as it is one of the most crucial choices a business owner can make.
Many financial advisors find themselves at a crossroads regarding their businesses. While they may enjoy the thrill of running a lifestyle practice, they can’t help but feel the pull toward building an enterprise. The problem is that building an enterprise requires significant investment in tech and infrastructure and a commitment to hiring staff. It can significantly impact the advisor’s income and daily routine, which can be tough. However, Puai Wichman points out that it’s important to understand the differences between the two models and to choose the path that aligns with your goals as a business owner. By doing so, you can prioritize your strategic initiatives and make informed decisions that will impact the success of your business in the long run.
Audit and improve your systems and processes before hiring a new employee. Don’t rush to hire when you feel overwhelmed.
When we hit our capacity limit, our initial instinct is to bring another team member to help us tackle the workload. However, taking a step back before jumping right into recruiting is important. Sometimes the solution to-capacity issues can be solved through technology and a few new workflow implementations. Puai Wichman explains before hiring your next service associate, investment operations associate, or paraplanner, conduct an audit on how you gather client data. For example, many advisors still rely on fillable PDFs or forms, which can lead to redundant data entry and wasted time. By utilizing digital client questionnaires that sync and integrate across your tech stack, you can ensure that your data is complete and entered across your various tools. If you’re experiencing data holes due to mismatched tools, consider a service like Precise FP to help bridge the gap. Don’t jump to hiring when you haven’t fully exploited your tech stack’s potential.
When preparing for meetings, advisors are often bogged down with updating financial plans and gathering the necessary information from clients. One way to streamline this process is by sending clients a digital questionnaire with all relevant fields and entries. Puai Wichman mentions that it increases the chances of getting all the information in one go and saves the advisor and client time. And for even greater efficiency, advisors can direct clients to sign into their accounts and update the necessary details. In addition, creating automated workflows in your CRM for repeatable processes and using calendar tools like Calendly for setting up meetings can further optimize your efficiency. Additionally, it’s crucial to tag clients in your CRM based on their needs and circumstances, allowing for quick and efficient communication. By implementing these practices, advisors can save precious time and energy while providing top-quality service to their clients.
Don’t fall into the trap of signing up for every new technology.
Before adding a new system or tool to your repertoire, Puai Wichman suggests following these steps:
- Optimize your key tech pieces – your portfolio management software, planning software, and CRM. Make sure they are integrated with your custodial platform for maximum efficiency.
- Regularly audit your tech – it ensures you know what you’re paying for and getting the most value out of it. The fintech industry is evolving, with platforms acquiring or merging with others. Instead of adding new tools, consider deepening your use of existing ones.
- Only adopt technology that brings value to your clients and is willing to invest the time to fully incorporate it. – Don’t rush into signing up for something without considering if your clients truly need it.
Setting clear expectations when hiring a new advisor is crucial for success. Don’t assume that a younger advisor with limited experience will automatically know what to do. Take the time to communicate your expectations and goals to avoid any disappointments down the line.
Here are some things to consider before bringing someone new onto your team:
- Start with a phased approach. Puai Wichman recommends allowing the new advisor to learn and observe before taking on more responsibilities. Gradually let them shadow you and practice; eventually, they’ll be ready to take the lead.
- Provide a roadmap for success. Clearly outline what you expect from the new advisor. Let them know which clients they should contact, how to approach them, and when they should be ready to take over the client relationship. Ensure both parties understand their roles.
- Measure success by the capacity they create for you. If your main focus is growing your business, have the new advisor manage client relationships so you can focus on new business development. It will ensure a faster return on investment.
Finally, remember that there are various options for advisors looking to outsource their practice’s operations. While there isn’t a one-size-fits-all solution, there is certainly the right solution for you.
Puai Wichman is the founder and CEO of Ora Partners, an international trust provider and wealth management firm dedicated to helping families and individuals protect personal and corporate wealth.