How to Build an Advisory Practice from the Inside-Out

By H. Adam Holt, CFP, ChFC

When advisors want to grow their practice, many try to get to the next level by ramping up sales or by adding new technology that promises growth and scale.

But often, growth from the outside-in and adding a large number of clients in short order can reveal a faulty foundation within a firm.

While it may not be as much fun as a new marketing campaign, I believe that advisory firm growth needs to begin with a practice management focus first. Advisors need to understand their financial and administrative needs before beginning a large hiring or sales effort.

Knowing how to develop your firm’s strengths can lead to a more productive team, better internal culture, and a business that ultimately provides more value and better service to clients.

Here’s how you can begin.

Track How You Spend Your Time

The average advisor spends 26 hours a week on direct client activity. But while that sounds like a healthy amount, many of those hours are spent preparing for meetings and not actually conversing with clients.

If you want to create a better firm as you grow, you first need to understand where your time goes. By tracking your hours, you can know with certainty what changes you need to make that will allow you to devote more time to business development. For one month a year, I use one of many effective time trackers called Toggl to make sure I know where my time is being spent.

Identify Where You Generate Revenues

In 2018, managed assets per advisor dropped on average, but average revenues rose.

Throughout the industry, advisors are introducing measures like retainers and a focus on one-time financial planning fees to protect their firm against new competition, as well as to stabilize revenues regardless of market performance.

Investing the time to identify your revenue-per-client helps set expectations for more realistic sales goals and more accurate client service expectations.

Your Internal Culture Impacts Your Client Experience

Before you can serve clients well, your team needs to learn how to serve each other well. You can accomplish this by knowing your firm’s core purpose and communicating it consistently to get your whole team on board.

Companies that don’t understand their core mission do not create consistently great customer experiences.

However, an advisory team that knows its mission and believes in it can create a customer experience that remains consistent over time.

Put simply, employees who love their work create clients who love your company.

Internal culture also impacts company stability. In one survey, 88% of millennials said they would stay at their employer for more than five years if they were satisfied with their company’s purpose. We’ve seen many advisors claim a larger purpose but don’t write it down, share it, or live it.

Add Technology That Enables Your Mission

One more final recommendation: Enable your team to do more with tech that bridges the gap between goals and behavior.

Efficient fact-finding gives you more time to prepare for meetings, and more time to engage in constructive conversations with clients as a result.

When you add technology that enables better conversations, such as through a visual representation of a financial plan, you make financial advice easy for your team to deliver, and easy for your client to receive.

When it’s time to grow, start on the inside first. Creating a firm foundation within your company can create the necessary framework for a company to thrive.

Asset-Map can help you create a cohesive approach across your entire team to working with your clients.Click here to read the story of JBirney Financial to see how they use Asset-Map to get their team on the same page.