In my July article in Research, I published an appeal to advisors to fill out my “Best Practices 2011” survey. Over 380 FAs responded. To everyone who helped: Thankyouverymuch!!
Let me reiterate my view of “best practices:”
The one thing that differentiates top producers from those who struggle, and even those who almost make it to the winners’ circle, is this: those who make it to the end of the rainbow do a little bit better at practically every aspect of the business. Not a single one of these ideas or practices will get you there, but a combination, while continually adding more, is what will keep you moving on the path to being the best.
To put it another way: There is no secret to success except this: Implement more “best practices” across the entirety of your business.
Scope of Business
Since I launched my survey, I have written a series of follow-up best practices articles. They are archived at www.financialadvisorsmarketing.net/category/best-practices. As you plan your new year, I would consult them and incorporate best practices that you do not yet own into your plan.
For you to succeed beyond the hated “average,” you must deploy best practices in four areas.
One of these is investment strategy. A major reason advisors lose clients is poor investment performance. A reason you don’t generate lots of referrals is poor or mediocre performance. Today, in my opinion, good investment performance must include a method to get out of the way of the next trainwreck. I covered this in my June 2010 Research article, “Get New Clothes: Don’t Stick with a Nakedly Wrong Strategy,” available on AdvisorOne.com.
In addition to your investment skills, you must also deploy best practices in the management of your business, your client relationship skills and your prospecting skills. Drawing from my survey, I will now show you some of what I consider to be the best “best practices.”
Winners and Not
In the tables that follow, you can study key business characteristics of two groups of advisors:
Winners. I decided to use $200 million in AUM as my own version of the “winner’s circle.” Almost all of these have been in business 10 years or longer.
Not Winners. I would certainly not use the term “loser” for this group. Many will have incomes way above the national average. But per the skewed standards of success in this industry, this group would not be receiving invitations to the Chairman’s Council, etc. For my “Not Winners” group, I pulled from my survey FAs who have been in business at least 10 years and have $50 million or less in AUM.
Firm Type Matters
If you would manage $200 million or more, you most likely hit your goal if you are in a national or regional wirehouse.
Lately, I’ve even seen a few independents reading the same tea leaves and moving from independent to wirehouse.