Whenever anyone asks me who the readers are of Investment Advisor, I’ve always responded that you are “independent and independent-minded advisors.” Independence is a wonderful thing, not just for the advisor but for the advisor’s clients as well, I’d argue, since by definition it doesn’t presuppose that proprietary products or a “one-size-fits-all” approach to investing or client service is the best path to follow.
Independence does have its drawbacks, however. You’re responsible not just for yourself and your clients, but for your partners and employees (assuming you have those), for marketing yourself, for making strategic and tactical plans and finally for planning your exit or succession plan. Yes, you have a broker-dealer or a custodian or you use a practice management or business coach, but the buck still stops with you. And one of the things you have to worry about is the competition.
What’s that, you say? You’ve got a very strong presence in your local community? Your clients refer others to you? You’ve got a column in the local newspaper and sponsor two Little League teams?
Well done. I would suggest, however, that your competition is no longer circumnavigated by your SMSA or your local business development council. (It’s also been my personal experience that the larger a firm is, the more time it spends on internal matters and avoids competitive issues. But I digress.)
In the many interviews I conducted for this month’s cover story—the 12th annual IA 25 list of the most influential people in and around the advisory business—the subject of robo-advisors, or the new generation of online advice providers, came up unbidden so often that I began to bring it up on purpose.