Creating a Business Plan (You Will Actually Use)

The Advisor as CEO
One reason so many advisors find it difficult to focus on tasks that have an immediate impact on their business is that they simply have too much on their plate. I talk to advisors every day, and I have yet to meet one who doesn’t feel overwhelmed. The tremendous uncertainty and volatility of the past two years has only intensified that sentiment and led to even greater time management constraints. That is why delegation is a critical element of the note card plan—if you are unable to delegate, you will find it extremely difficult to narrow your focus to actionable, impactful tasks.

Advisors should ask themselves, “Could I hire someone who could do [insert function here] just as well as, if not better than me?” Perhaps that function is asset management; maybe it’s market analysis; it could even be creating financial plans. The point is, every advisor excels at—and enjoys—one particular aspect of his or her profession more than others. To achieve maximum efficiency—not to mention maximum job satisfaction—advisors should zero in on the one thing they do best and enjoy most. This goes beyond task delegation; this is about embracing your passion.

Another important point to consider is the dichotomy between being a financial advisor and being a business owner or CEO. Most advisors have years of financial industry experience, but little or no experience or training in how to run a successful business. Those who have recently transitioned from a wirehouse setting to the independent space have a particularly difficult time managing the operational and administrative aspects of their practices, having grown accustomed to the firm taking care of these matters.

Balancing CEO functions and financial advisor functions is often a major challenge. In my view, multitasking is not the answer. It is virtually impossible to constantly switch gears, so my advice is for advisors to allocate specific time periods to focus solely on business-planning activities. For example, one might designate every Friday as the day to meet with staff members, assess performance, or analyze progress on various objectives. That way, you’re not trying to squeeze these things in between client meetings.

If this approach doesn’t work, another alternative is to delegate the entire CEO function itself. I worked with one advisor who was dissatisfied with how his sales staff was performing. Meanwhile, his sales staff complained that he wasn’t providing the direction they needed. He realized that he needed someone else to take over the management role so he could focus on his core competencies. He was able to promote a senior member of the team to CEO, thereby ensuring that the individual understood the firm’s vision.

Finally, for those advisors who are great financial planners, but lack managerial skills, there is something to be said for management training. If you cringe at the thought of sitting through a two-day course or reading a 300-page book on how to be an effective manager, consider this approach: Rather than trying to absorb all 12 hours of an instructor’s material or all 300 pages of a book, use these resources to glean only the key points that are relevant to you and your practice. It is a strategy that aligns perfectly with the note card plan, in that it helps you cut through the clutter and focus solely on what has an immediate impact on your business.

Unified Vision
The strength of an advisor’s business plan depends largely on buy-in from his or her staff. One of the advantages of the note card plan is that it can fit inside a shirt or coat pocket for easy reference, but it should by no means stay there. All staff members should not only have a copy of the plan, but also be intimately familiar with what it means. That is why unified vision is my third guiding principle—in order to successfully implement and execute a plan, your entire staff must be on board.

For example, if revenue goals are part of your plan, each staff member should be aware of why certain goals have been set and how the firm is progressing toward those goals. Furthermore, all staff members should have a clear understanding of how their performance impacts the firm’s goals, so that everyone can establish personal objectives that support the growth and success of the practice. In addition to having a copy of the “master” plan, each staff member may even want to create his or her own individual plan.

There are three key steps to keeping staff members aligned with the firm’s vision. First, communication with staff should be just as consistent as communication with clients—it must be an ongoing loop, not limited to a one-off or even quarterly meeting. Second, each staff member must have defined roles and expectations. Third, advisors should establish an environment of collaboration that encourages feedback and open sharing of ideas. Giving people the opportunity to express their ideas not only makes them feel like they are contributing to the success of the firm, it also helps improve morale.

Clearly, managing staff effectively requires significant effort, which brings us back to the advisor vs. CEO dichotomy. A successful business needs strong leadership, but most advisors are already overwhelmed and many don’t consider themselves good managers. That is precisely why having a simple, streamlined plan is so important—it will make it easier for everyone on your staff to understand and execute on the goals you outline for the firm.

That’s the beauty of the “note card plan.” It is a daily reminder of the actionable tasks you and your entire staff should be focusing on to achieve measureable goals. It is designed to help you maximize your three investable assets: time, energy and money. It can help you effectively balance your duties as a financial advisor with your responsibilities as a business owner. Finally, it is a manageable plan that you will actually use, rather than stuff in a drawer.