Financial advisors constantly tell me how frustrated they are about implementing real change in their businesses. “You’ve given me some great ideas,” they say, “but I just can’t seem to get any of them done.”
Somehow, real change — even when you strongly desire it — seems elusive. With 2008 fast approaching, you may find that, like many people, you’ve simply resolved to not make any more New Year’s resolutions — because you’ve rarely kept them in the past. But if you’re truly ready to resolve to succeed, here’s a practical, three-step plan that begins at the beginning, doesn’t require a miracle and inevitably produces substantial results.
o Step 1. Determine where you stand now. As objectively as possible, determine where you stand now so you can more realistically formulate your goals.
o Step 2. Develop your strengths and compensate for your weaknesses. Next, determine your strengths and your weaknesses so you can leverage the former while compensating for the latter.
o Step 3. Move past analysis paralysis. Give up on finding a “silver bullet,” a plan guaranteed to work. Instead, get going, give yourself permission to be less than perfect and keep moving forward.
Step 1. Determine Where You Stand NowThe best place to start is exactly where you are, right now. For example, if you want to lose weight, the first thing a dietician will have you do is write down everything you eat for several days in a row. (Most people underestimate their daily caloric intake, which is in part why most weight loss regimes inevitably fail.)
Similarly, as a financial advisor, you need to see exactly how you stand compared both to other advisors and to where you want to be. Earlier this year, CEG Worldwide undertook an extensive study of financial advisors across all three channels — registered investment advisors, independent broker-dealer representatives and brokers employed by wirehouses. As the table shows, regardless of income, the vast majority of financial advisors are not satisfied with their current levels of success; very few are satisfied with how their businesses have grown over the last two years; and most believe that their practices could be more profitable.
If you are among these many less-than-satisfied advisors, you owe it to yourself to undertake a detailed and detached analysis of the profit drivers of your business. Which of your clients are unprofitable, which are profitable, and which are the most profitable? How did you acquire your most profitable clients? What do they have in common? How can you change your client acquisition and relationship management processes to ensure that you maximize the profitability and growth of your overall business? And most important, if you were to maximize your profitability and growth, how would that translate into net income and quality of life for you?