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Practice Management > Building Your Business

Step by Step

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So far this year, I’ve lost almost 30 pounds. I did it through a process developed by Weight Watchers. Of course, I’ve always known the way to lose weight is to eat less and exercise more. But it’s not that knowledge that got me to slim down, it was the Weight Watchers process–a simple process of weighing my food, counting my food points, going to meetings, and getting weighed each week.

The longer I’m in business, the more I realize that process is everything. In fact, it turns out that there are far more patents for processes than for products. Think about McDonald’s. They were the first to industrialize the food service industry. They did it by dividing the order-taking, cooking of food, and delivery of food into its discrete parts. Then they refined and tweaked each discrete step until they had optimized the entire process. In the end, they created one of the world’s most valuable companies.

The interesting thing is that most of McDonald’s employees are teenagers. As Michael Gerber, author of The E-Myth, says, “We can’t even get them to clean their rooms, yet McDonald’s has built a billion-dollar company around them.” So the key to the company’s success is clearly not the people, it’s the processes.

One of the primary things that keeps many financial advisors from moving to a fee-based business model is that they don’t have processes. They are not business-people; they are salespeople who are naturally persuasive and who fly by the seat of their pants.

As our industry continues to evolve, more and more clients are starting to recognize this also. It’s the process more than the product or even the individual advisor that will make the difference between failure and success. To add value for your clients, you must develop a systematic process that you and your team implement consistently. Not only is the industry moving from transactions to relationships, it’s moving from transactions to relationships based around systematic processes.

The Search for Process

A number of years ago, I decided to replace my accountant. He was slow and a bit sloppy, and I felt it was time to upgrade. I spent about six months trying to find the ideal accountant.

What I was looking for was an accountant who understood my industry and had systematic processes. I had my assistant call a number of accountants that I had identified in the Yellow Pages. We asked them to send us their marketing material, and then I interviewed a number of them. For the most part, they told me that they would give me great service, but no one had a checklist, showed me a flowchart, or said, “Here’s how we provide value in a systematic way.”

I was looking for someone that had a filing system already set up, and who would say, “Here are the files you’ll need in California; here’s a checklist of important dates relating to tax returns and other financial matters.” I was not able to find that. Eventually, I did find a competent accountant, and have encouraged him to develop and organize his processes to make his business more efficient–and, quite frankly, to make my relationship with him more valuable to me.

I recently started working with a new law firm as well. (It was time to upgrade my attorney, too.) I am building a new product for my company and needed help in the area of intellectual capital. This particular firm has developed excellent processes for this highly complicated area of law. Every one of the attorneys I have worked with, each a specialist in his or her area, employed the same processes.

My previous intellectual property attorney charged me $300 an hour. Now I pay only $190 an hour for a junior attorney. A very senior expert attorney, who charges $500 an hour, discusses any unusual issues with the junior attorney and then reviews the finished work before it is sent to me. The result for me is better advice and contracts at a reduced cost.

In a conversation with one of the attorneys recently, I questioned him about the fact that everyone seemed very professional and had organized systems and processes for getting work done. The attorney said that they are all trained in the same system and process. The firm hires people while they are in law school and trains them in a certain way of doing things. This is very different from most law firms (and financial service companies). In most firms, the individual attorney (or financial advisor) determines the process and ultimately the result. The process is not established by the firm.

One Thing at a Time

So how do you create useful processes? The first step is to define what your desirable outcomes are. Then you need to define what has to happen to achieve that outcome, and divide that into discrete steps.

Let’s say your desired outcome is to start a new client relationship. What are the steps you need to do accomplish this?

1. Identify specific prospects you want to attract.

2. Determine how to attract them to a face-to-face meeting.

3. Discover what they want from their money and if they are open to having a relationship with a financial advisor.

4. Gather appropriate personal and financial information.

5. Analyze the information and decide what the best solutions are to help your prospect achieve his goals.

6. Develop a written proposal that demonstrates how your solutions will meet your prospect’s wants and needs.

7. Meet with the prospect and present your proposal.

8. If they like you and your solutions, complete the paperwork and transfer their money to your firm. You now have a new client and must now implement your investment management processes and your client-service processes. Finally, you will want to apply your referral-generating process to start the cycle over again. It’s all about process.

We have found in our business that the major challenges and breakdowns occur when information is transferred from one person to another without a formal form or process, or when the form is not completed correctly. That makes it difficult for the next person to do her job and creates extra work. Standard forms and operating procedures will help everyone identify what information has to be gathered so the work can proceed in a step-by-step process to create the desired outcomes.

It’s a good idea to create flowcharts. From the flowchart, you can create data-gathering forms and checklists. Once you have developed the forms, you can develop standard operating procedures of how those forms are used and, most important, how information is exchanged between team members.

Processes in Action

When you’re designing business processes, it’s important to recognize that different people have different skill sets. As you divide the work into discrete steps, you want to make sure that those steps are based around your and your team members’ unique skills.

It’s often very difficult for one individual to be proficient in all areas. Most people are either better with data or better with people. It’s critical to have different people specializing in each of these areas. If you try to get your client service person to crunch numbers, he’s likely to not like the work and not do a great job. And a data-oriented person is usually not the one to bond emotionally with your best clients. You are much better off hiring two part-time employees, each of whom is competent and enjoys specific job duties, than hiring one person who is only good in one area.

In the future, both in both small and large financial services companies, processes will rule more and more. The evolution from transactions to fees can also be seen as an evolution from random transactions to process-driven outcomes. Leading-edge firms will start to divide the complicated work of comprehensive wealth management into discrete functions. They will have different people with different skill sets, personality styles, and interests completing different parts of the work. The goal will be a more efficient, streamlined process, creating more value for clients at a much lower price.

I still have another 15 pounds to lose on my diet, but I have confidence that I will achieve and maintain my ideal weight. After all, Weight Watchers has already built the framework; all I have to do is follow the rules of the process.

Steve Moeller is president of American Business Visions and author of Effort-Less Marketing for Financial Advisors. Call Steve at 714-505-8030, ext. 206, or visit


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