What differentiates a top-performing advisory firm from others? It’s a crucial question not only for successful firms, which naturally want to maintain their leadership, but also for other firms that want to join the pantheon of industry leaders.
With that in mind, AssetMark, an independent provider of investment and consulting solutions for financial advisors, embarked on a year-long study of high-growth firms whose leaders interacted with each other in order to reach a consensus on best practices to drive growth. Included in the study was an investigation of personality types within firms to see if there were a specific set of characteristics or behaviors among advisors that contributed to their firm’s success.
Altogether, the heads of 41 advisory firms across the country with sustained annual growth rates above 20% and a minimum $25 million in assets under management participated in the study.
Among the study’s key findings: no single personality style dominated in the leading firms. “There wasn’t any consistency in [personality] profiles,” says Matt Matrisian, senior vice president of practice management and strategic initiatives at AssetMark. “Personality didn’t dictate [success].”
The study used the DISC (Dominance, Influence, Steadiness, Compliance) behavioral style assessment tool and the behavioral assessment styles of TTI Success Insights, which extends the DISC styles to eight distinct personality types: conductor, promoter, implementer, supporter, persuader, realtor, coordinator and analyzer.
Even though the study found that “there was not one particularly dominant profile,” it did conclude that knowing DISC “could be a valuable tool in creating a successful team by adding individuals with (perceived) complementary DISC styles.” It could help with team building and hiring, promoting harmony and decreasing conflict, according to the report.
To that end, one participant in the study reported that “staff members put their DISC designations on their desk so everyone would be reminded of how to communicate with them.”
DISC can also be applied to client relationships, according to the study. “All participants agreed that going forward … they needed to identify likely clients’ DISC profiles and either mirror the actions that those clients best responded to or use their own self-understanding to select more ‘ideal’ clients that they would naturally enjoy working with.”
The AssetMark study also found that in addition to using behavioral diagnostic tools, advisors reached consensus on these best practices to drive growth: Using business diagnostics to optimize and build capacity in staff, leverage platform partners and regularly measure success; prioritizing strategic planning by setting fixed times for quarterly reviews and creating short-, medium and long-term goals; and building to create lasting change through either a third-party partner, internal staff member or study group.
One interesting finding of the study: Participating advisors and firms reported improvements in their firms’ operations as a result of participating in the study. By the end of the year, participating firms showed a 23% increase in assets under management, 13% increase in fees and 7% higher operating profit compared to the control group.
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