Advisors need to have a vision for what they want their firm to be. (Illustration: Pete Ryan)

Immigration, abortion, fracking, surtaxing the 1% — presidential elections may seem to hinge on issues like these, but that’s just a façade. In reality, elections are about vision: what values each would-be leader thinks our nation should stand for, what we should try to achieve, how people should be treated.

It’s no different for leaders of companies. If you want people to follow you, you need “the vision thing,” as former president George H.W. Bush called it.

“A lot of financial advisors get into the business because they love to help clients,” observed Greg Friedman, founder and CEO of wealth management firm Private Ocean in San Rafael, California. But as a firm gets larger, he said, keeping it going in the right direction becomes “exponentially harder.”

If you’re the leader of a growing enterprise, your people need to know your vision. Regrettably, many advisors who enjoy grappling with client challenges tend to sidestep employee issues. Aren’t good employees supposed to be self-directed, after all? What’s the payoff of having a vision?

Why Vision Matters

“Vision” expresses what an organization aspires to be. By defining it, you can seek out potential partners, staffers, clients and referral sources who agree with this aspiration and want to be associated with it.

Consider the difference that articulating your vision could make to junior advisors, paraplanners and support staff you hire. Like most of us, they’d rather work for a firm whose values align with theirs. “But when people don’t know what their company is trying to do or how important they are to its success, they end up giving only a fraction of their creativity, skill and initiative to their work,” said Le Herron, a retired CEO who wrote “Making Your Company Human: Inspiring Others to Reach Their Potential.”

Advisors tend to focus on keeping their clients happy and their revenue stream flowing. But remember, Herron noted, that organizations actually stand on three legs: not just their owners and customers, but also their people. All three are equally important for success.

In addition to squandering human capital, lack of a coherent vision can turn the whole enterprise into an orchestra where everyone is playing different music. The results may include inconsistent behavior, confusion, dissatisfaction and, ultimately, higher turnover among both employees and clients that affects the bottom line.

Walking the Walk

To be useful, your vision needs to be based on values that you consider non-negotiable. (See sidebar, “What Do You Stand For?”) More importantly, those values need to be an integral part of you.

In other words, Herron pointed out, it’s not enough to profess what your organization stands for. You need to live it, day in and day out. “I have a hanging that my wife, Betty, put on our kitchen wall soon after we were married,” he explained. “What you are speaks so loud that I cannot hear what you say. No matter what we say we are, people can see what we really are.

“So anyone concerned about leading needs to start by asking the question, ‘What am I?’ Are you all about ‘me, me, me’? About ‘my career,’ ‘my name recognition’? Or is your vision about making your organization very successful, about making people part of that success and feeling ownership of it?”

Private Ocean’s Friedman, the author of “Advisory Leadership: Using the Seven Steps of Heart Culture to Create Lasting Success for Any Wealth Management Firm,” is equally passionate about leading effectively. “An organization will very much reflect its leadership,” he observed. “As they say, fish rots from the head down. When you see a front-line person who doesn’t treat a customer well, chances are he’s reflecting the views of a superior.”

Like Herron, Friedman believes that leadership is about helping other people get what they need to feel engaged and be productive. “I put a lot of energy into creating an environment so people know where we are going and what our purpose is,” he said. “That’s what creates excitement and meaning. People need to know, ‘What’s my part in this? What’s in it for me?’ At the same time, you need to ask yourself, ‘What’s my role in supporting them?’”

If this sounds like servant leadership, that’s exactly what it is. In Herron’s case, it extends even to the language he uses.

“The word ‘employee’ is not inspiring,” he said. “It implies an exchange of services. It’s even kind of degrading. ‘Associate’ suggests people coming together for a common good. But you still need to breathe life into it, make it come alive. You do that by showing how coming together will help them, both individually and collectively.”

After retiring from O.M. Scott & Sons (now Scotts MiracleGro) in Marysville, Ohio, Herron and his wife stayed in the community. He still bumps into workers he formerly led. “They tell me, ‘We were family,’” he said. “They felt important and part of the success.” Thirty-three years later, they still cherish that experience.

Communicating and Reinforcing Your Vision

Once you’ve defined your vision, it’s critical to get buy-in from all key team members. If your organization is too widespread for easy one-to-one contact, there are other effective ways to tell the story. Big organizations sometimes hold companywide rallies with lots of hoopla, signaling the importance of the messaging with the scale of it all.

“If you are small, you can do something different,” Herron suggested. “For example, take the families to dinner.”

His own communication task at the 1,200-person, multiple-location firm was tricky. A few years into his tenure as CEO, the closely held firm was unexpectedly sold to ITT Corp. The challenge was to persuade numbers-oriented managers at the huge conglomerate — as well as the young MBAs they sent to Marysville — not to cost-cut the heart out of the family culture that had made Scotts successful.

Herron’s solution was to write a series of letters about aspects of the company’s unique culture, such as the absence of factory time clocks. Over a multi-year span, dozens of these letters were sent to associates’ homes and to ITT offices in New York. The bean counters backed off — and sharing the company’s vision heightened Scotts associates’ pride and loyalty.

Translating Vision Into Culture

The shared values and beliefs of a company culture are greatly influenced by its leader’s vision. “I think of culture as what happens when nobody’s looking,” Friedman said. “It’s how you treat birthdays and other events, whether your people work in teams or in silos, whether they feel a sense of urgency or they’re laissez-faire.”

When his firm, Friedman & Associates, merged with Salient Wealth Management in 2009, he and Salient CEO Richard Stone spent many hours discussing the vision and culture they wanted to promote at Private Ocean. (See “Mergers & Aspirations,” Investment Advisor, August 2015.) Now, Friedman said, “I have two companies, one with 50 people and the other with 25. I’m proud of them both. We do a great job — earnest and with heart.”

It’s probably impossible to reiterate too often what you want your organization to achieve and how you expect your team to conduct themselves in pursuing it. Keep reinforcing these messages through a variety of communication channels. “A strong leader creates and renews the company culture through actions and words,” Friedman argued. “You can’t take it for granted or let your attention wander.”

But, he emphasized, the effort is worth it. “Someone I highly respect said, ‘Culture trumps strategy every time.’ If you have the best strategy and the worst culture, your business will probably not be successful.” (See sidebar, “Positive Culture Pays Off in Better Performance.”)

Hire From the Heart

“Hire people with the qualities that are important to you,” Friedman said. “I always start with integrity. I look for people of their word; people with passion, collegiality, who are team players. You can have the best résumé, but if you don’t have these qualities, it won’t work. It’s a lot easier to find a [suitable] résumé than to find the right people.”

He also inculcates new associates with the Private Ocean vision right from the get-go. “I spend the first hour of the first day with every new hire, telling stories that explain our purpose,” he explained. “I show them the passion. ‘Let me tell you why it’s so cool.’ I give them what I call my Martin Luther King speech: ‘I have a dream that this company will be the kind of place that makes you want to think to yourself, when you roll out of bed in the morning and put your feet on the floor, “I work with cool people and we do cool things. Short of having all the money in the world and being a great philanthropist, I couldn’t be more excited — so let’s go!”’” He finishes by telling the newbie, “And if that’s ever not true, I want to know about it.”

Keeping the Team Motivated

So you now have a staff. Perhaps a paraplanner; perhaps an office manager. Or you’ve merged and suddenly have 15 or 20 new people on the payroll. If you didn’t hire them yourself, immediately familiarize yourself with everyone. “Go around and shake hands,” Herron advised. “Ask personal questions: ‘Where’d you go to school? Are you married?’ People are flattered when you show interest in them. It’s nice what you can remember, but the purpose is to make that person feel wanted and appreciated.”

Over time, familiarity can breed neglect. Don’t let it. Step out of your office every day and check in personally to see how each person is doing. Friedman makes opportunities to tell them they’re appreciated. “One of my companies [Junxure, a CRM software firm] is in North Carolina,” he said. “I personally call each person on their birthday to thank them.”

Compared with genuine appreciation, money is a poor motivator per se. “Most successful people aren’t driven by greed,” he said. “Some were raised, as I was, hearing, ‘Time is precious. Whatever you’re going to do, do it to the best of your ability.’ Others want to change the world. In any case, throwing more money at someone who’s not self-motivated doesn’t make a difference. People are either a cultural fit or not.”

Another powerful incentive costs nothing at all: trust. When people are wholeheartedly on board with your vision, trustworthiness is typically not an issue. “If you trust people, they will live up to that and will trust you,” Herron maintained.

For example, Scotts was one of the first national companies to offer a No-Quibble satisfaction guarantee. “Even insiders marveled, ‘Don’t customers take advantage of it?’” he said. “Similarly, there were no time clocks. If we trust our customers, why wouldn’t we trust our people? You would be surprised how that resonates.”

Bad Times and Bad Decisions

Every organization runs into bad times. Markets sink. Clients get angry. People worry about losing their jobs. How do you sustain your vision and culture at times like these?

Don’t wait until Dowmageddon to speak up, Herron advised. “You need to be communicating regularly with your jobholders to let them know how the organization is doing and how they are doing,” he said. “Be willing to share both the good and the bad. Tell them, ‘We’re concerned.’ They’re part of it. They’re family. Make sure they know they can come to you if they have a problem or questions.”

He added, “In bad times, the first thing most leaders do is lay off people. Instead, why not ask your people, ‘What do you think we should do?’ If you’ve hired the right people, their creativity will surprise you.”

Suppose an associate makes a mistake that costs your company a lot of money or alienates a client. “Mistakes of judgment or execution are opportunities to help people grow,” the retired CEO said. “Get together with that individual to ask why they did it that way. Do they still think they did the right thing?

“In the process, you’ll also learn about that person,” he continued. “Are they stubborn or cooperative? If they’re stubborn, you need to change that attitude by communicating how people who work at your firm are expected to be.”

When an error occurs at Private Ocean, “I start with the assumption that you didn’t do it on purpose,” Friedman said. He takes three things into account: “First, did it affect the client? If so, we need to remedy the situation. Second, let’s understand what led to the mistake. Third, let’s set a system or process in place to prevent it from happening in the future.”

As a result, an inadvertent blunder usually leaves long-term Private Ocean associates relatively calm and unfazed. “Newer employees tend to be more fearful,” he said. “It takes me a while to breed that out of them.”

Sailing Toward Success

“It can be difficult to grasp if you have a large ego,” Herron said, “but the most rewarding thing a leader can do is encourage people to move toward their potential. The other day I met a former Scotts associate in front of the post office who said to me, ‘You showed me that my potential was better than even I thought it was.’ When people grow, the organization grows.”

“It’s the polar opposite of ‘command and control,’” Friedman concluded. “Your job is to set the tiller toward the horizon by defining your vision. Then hire the best people, empower them, support them and get out of their way.”