The ClientWise Blog

Polonius Never Tried to Grow a Practice

Posted by Ray Sclafani on Oct 1, 2019 10:27:47 AM

“Neither a borrower nor a lender be: For loan oft loses both itself and friend.”

Hamlet; Act 1, Scene 3

It’s one of the most recognizable and oft quoted lines in all of Shakespeare’s works, nestled right between two other pieces of sage advice that Polonius imparts to his son Laertes: “give every man thy ear, but few thy voice” and “this above all; to thine own self be true.” But while there’s a certain universal wisdom to those other two tenets, if you’re an advisor who’s seeking to rapidly and measurably grow your business, you’ll be well served to embrace rather than avoid the capital of others.

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Topics: enterprise value

Capacity and Productivity - The keys to unlocking future growth

Posted by Ray Sclafani on Sep 19, 2019 2:36:00 PM

For any enterprise that’s serious about meaningful and sustainable growth, getting a grasp on how to better control these two critical financial metrics is essential. As you grow, you’re facing a cascade of important decisions:

  • Should I add staff and when?
  • Do I need to start thinking about more office space?
  • When is it advisable to merge or acquire someone in another location?

While profitability can certainly be a useful financial metric, it’s your business’ capacity and productivity which are the two inextricably linked measurement tools that will give you the clearest insight into making those types of mission critical decisions.

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ClientWise is the premier financial advisor coach focused on business development and management best practices for financial advisors.

Topics: enterprise value

Rainmaking Matters

Posted by Ray Sclafani on Jul 17, 2019 10:22:47 AM

One storm is no longer enough...

When it comes to fueling meaningful growth in your enterprise, the days of succeeding by doing one thing very well are quickly becoming a thing of the past. If you’re a rainmaker who has focused on a particular tried and true practice – whether sourcing leads from existing clients, cultivating a network of professional advocates, steadily increasing your share of wallet from existing clients, or recruiting/acquiring other advisor teams – now’s the time to start expanding your horizons by seeking out new additional sources of growth.

The most recent PriceMetrix/McKinsey State of Retail Wealth Management study found that advisors in the top quartile for growth increased annual revenues by 37% (compared to an 8% decline in growth for the bottom quartile). What differentiates the top performers? Not surprisingly, these firms generate most or all their revenue from fees, and function as interdependent teams rather than sole practitioners. What stands out, however, is the realization that only a small percentage of these leading advisors are actively engaged in acquisitive growth. It begs the question…why?

Beware the fast-track

We hear so much about the aging advisor demographic, and we read profiles in the trade press about advisors who seemingly overnight turn a $100MM practice into a $2+ billion enterprise through a series of aggressive acquisitions. It seems like the perfect quick road to rapid growth. What we don’t hear a lot of talk about, however, is the often grossly

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ClientWise is the premier financial advisor coach focused on business development and management best practices for financial advisors.

Topics: Client Acquisition

Who’s your Practice Management Champion™?

Posted by Ray Sclafani on Jul 8, 2019 9:13:59 AM

Every enterprise needs one; here’s why

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ClientWise is the premier financial advisor coach focused on business development and management best practices for financial advisors.

Celebrating Independence

Posted by Ray Sclafani on Jul 3, 2019 6:59:02 PM

If there’s one holiday that should especially resonate with financial advisors, it’s the 4th of July – a celebration of our nation’s unyielding and relentless desire for self-determination. After all, it was that same fundamental yearning for independence that propelled most of us to take a step into the unknown and launch our own firms.

The allure of independence is extremely compelling – calling all the shots, no more limited payouts, long-term equity ownership and an ability to align the business with your core values and beliefs. But perhaps there’s no stronger case to be made for blazing your own path than the opportunity it affords you to act in an unencumbered fiduciary capacity for your clients.

There’s one particular sentence in the Declaration of Independence which reads:

“But when a long train of abuses and usurpations, pursuing invariably the same Object evinces a design to reduce them under absolute Despotism, it is their right, it is their duty, to throw off such Government, and to provide new Guards for their future security.”

It’s a sentiment (albeit a strongly worded one) that could serve as a “bill of rights” for each and every client who entrusts you with his or her financial future. While your name may not be Hancock, Jefferson, Adams or Franklin, you nevertheless follow in their footsteps by passionately advocating for and acting in the best interest of those whom you serve. This is a truly noble profession – one that directly impacts the lives of the individuals we work with, future generations of their family, and the philanthropic causes they support.

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ClientWise is the premier financial advisor coach focused on business development and management best practices for financial advisors.

Topics: Holiday

Motivation Beyond Money

Posted by Ray Sclafani on Jun 21, 2019 10:13:10 AM

Finding Your Personal Satisfaction Drivers

In our work over the years with hundreds of advisory teams, nearly every phenomenally successful team leader has shared ONE common attribute – a clearly defined objective as to what he or she wants from their career beyond mere monetary rewards.

Don’t get me wrong; we all want to be well compensated for our entrepreneurism, our labor and our diligent advocacy on behalf of our clients. But there must be a sense of some larger purpose in order to continually push us to go a little bit above and beyond.

"Sustainable growth and success are far more likely when what you seek to achieve is clear, important and personal to you as a human being."

Building an enterprise based on something larger than just profit will dramatically color the approach you take to building your team, the way in which you interact with clients, the strategy and tactics you employ to grow the business, and ultimately, the personal satisfaction you derive from your work.

Define your satisfaction drivers

Carve out some time where there are no distractions, and thoughtfully answer the following questions. Once you’re done, set them aside for a week and then revisit your answers to ensure they truly reflect who you are as a person.

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ClientWise is the premier financial advisor coach focused on business development and management best practices for financial advisors.

Topics: Business and Operations Management

Empty Chairs - The looming NextGen advisor crisis

Posted by Ray Sclafani on Jun 3, 2019 4:38:13 PM

The statistics paint a pretty bleak picture. The average financial advisor today is age 51, with nearly half (43%) over the age of 55 and therefore inside of a decade from retirement age. Conversely, the number of new junior advisors entering the workforce isn’t even close to keeping pace with the number of senior advisors exiting. According to Ernst & Young’s recently released The Next Generation of Financial Advisors report, each year there are two financial advisors qualifying for Social Security benefits for every new advisor entering the market.

Advisory firms have become incredibly top-heavy organizations. According to Michael Kitces, three out of every four U.S. practices currently have more lead advisors and partners than support and service advisors to work with them.

Sustainability impact

Exactly what does this mean for the long-term sustainability of your enterprise? Without a talented team of young advisors to eventually take over the reins, not only are you risking your firm’s future, you’re seriously jeopardizing your ability to monetize your life’s work. More importantly, you’re neglecting your fiduciary duty to your current clients.

With each client you’ve onboarded, you promised them (either explicitly or implicitly) that you’ll be there through all of their life’s transitions – helping to put their kids through college, preparing them for retirement and dealing with crises like illnesses or the death of a spouse/parent whenever they arise. However, if you don’t have a plan to ensure continuity of client care beyond your working life, that promise is rather meaningless.

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ClientWise is the premier financial advisor coach focused on business development and management best practices for financial advisors.

Topics: Business and Operations Management

Proclamation on Prayer for Peace, Memorial Day, 2019

Posted by Ray Sclafani on May 25, 2019 5:35:55 PM

Regardless of political persuasion, whether red state or blue, there are some messages that transcend politics and provide a rare opportunity to begin salving wounds and healing divisions. At ClientWise, we head into this Memorial Day weekend with the deepest appreciation for those who gave their lives for our country, and a renewed resolve to help reignite the principles of honor and integrity by which these brave men and women lived their lives. I hope we can all come together in support of the following White House Proclamation on Prayer for Peace. 

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ClientWise is the premier financial advisor coach focused on business development and management best practices for financial advisors.

Topics: Holiday

Engaging the NextGen client

Posted by Ray Sclafani on May 20, 2019 4:07:04 PM

The clock is ticking

We’ve all seen the statistics. The probability that your firm will be able to retain your current clients’ assets once they transfer to the next generation are slim – by most accounts, the percentage of those assets that will remain with your firm post-intergenerational transfer is in the teens. It’s the elephant in the room that nobody wants to acknowledge.

Think about that for a minute. If you’re currently running an enterprise with $500MM in AUM and an average client who’s aged somewhere near 60-65, choosing to do nothing but whistle past the graveyard means there’s a very good chance that close to $425MM of your current AUM will at some point walk out the door over the next 20 years! And if you’re average client is age 70+, you’re looking at the exact same outcome just over a more compressed timetable.

All the time, effort and energy you’ve devoted to acquiring and caring for your clients; gone for no other reason than failing to effectively engage with the next generation before they become inheritors of wealth.

5 ways to build better connections

While they may be inclined to make a clean break and forge their own path with their own people, there are steps you can take to build stronger relationships with the next generation.

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ClientWise is the premier financial advisor coach focused on business development and management best practices for financial advisors.

Topics: Client Acquisition, Client Engagement

What’s My Job Again?

Posted by Ray Sclafani on May 6, 2019 4:52:44 PM

Why clearly defined roles and responsibilities matter

Remember when you first started your firm? Not only were you the owner of the business, you and your original team members all needed to wear multiple hats. You moved from client acquisition to client service; from placing trades and rebalancing portfolios to implementing software and technology; and from regulatory responsibilities to handling benefits and payroll.

Over time, as the business grew, you were able to make additional key hires – building a team of complementary professionals around you. Yet for many advisory owners (even those who’ve built large multi-faceted enterprises) the jack-of-all-trades mindset persists. Rather than hiring and cultivating highly-skilled specialists, they gravitate towards generalists who may not be exceptional at any one discipline but who can pitch in when and where needed.

Ask yourself one simple question. If you needed bypass surgery, would you look for a general surgeon or would you find someone who’s a cardiothoracic specialist?

Building specialized expertise

Our research shows that in most enterprise teams, founders/principals tend to play a large role in almost EVERY team function. They are the pivotal identity of the team – a factor which limits rather than enhances the value of the firm. When perceived enterprise value rests almost exclusively in theidentity and activities of one or two leaders (who will one day retire), it is inevitably diminished.

The best enterprise leaders know that a critical aspect of their role is putting team members in positions to succeed and developing/coaching those individuals so that they can not only be

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Topics: Team Development

Rewarding Performance - Human capital is an asset, not a liability

Posted by Ray Sclafani on Mar 27, 2019 9:00:00 AM

As a strategic business leader, you recognize that your team – your human capital – is your most important asset. You invest in them in a variety of ways and, in turn, they fuel the continued growth of your enterprise. That’s why one of the most important elements to the longevity and continued success of your business is your ability to attract and retain talent – getting the right people in the right seats at the right time, and not losing them to the competition.

Yet many firm principals tend to view their human capital solely in terms of being a cost (albeit a necessary one) of doing business. It’s a mindset that leads to reactionary rather than proactive behaviors. Instead of hiring to drive growth, these organizations usually hire in response to growth. They frequently push the limits of capacity – reluctant to bring on new team members until it’s deemed absolutely essential as indicated by a drop-off in service quality. And they reward exceptional performance haphazardly – driven more by the fear of losing a key player rather than an effort to cultivate loyalty and stronger bonds.

Recruiting and retaining top talent

One of the key elements of this challenge is the creation of clear and measurable growth and development plans that provide clarity around not only what is expected of each team member, but precisely what they need to achieve in order to take the next step in the firm. Research shows that individual team members who participate in written performance

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ClientWise is the premier financial advisor coach focused on business development and management best practices for financial advisors.

Topics: Team Development

The Case for OKRs

Posted by Ray Sclafani on Mar 20, 2019 11:07:57 AM

Odds are, at some point during college or in the early years of your career, you were introduced to the acronym “SMART” as it relates to creating business goals and objectives. The approach, made popular by Peter Drucker, proposed that for business goals to be effective, they had to be: Specific, Measurable, Achievable, Relevant and Time-bound.

For years, it’s a structure that has provided a useful means for setting and achieving goals. But the SMART approach has always had a major, nagging flaw – it’s only able to look at goals individually in isolation, rather than collectively. So, while SMART can still serve as a highly effective way to set and achieve personal goals, it will never be able to accurately account for the complex interrelationships and interdependencies of multiple goals across an entire organization.

Thus, the impetus behind the creation of “Objectives and Key Results” (OKRs). Developed by Andrew Gove at Intel and later widely popularized by John Doerr in his book Measure What Matters, OKRs offer a better way to connect every individual team member to your enterprise’s strategic growth plan.

How OKRs Work

With OKRs, agreement is first established on the high-level, long-term goals of the organization. These goals then directly inform a more actionable 1-3-year plan for specific financial and growth-oriented objectives and key results. Those enterprise-level OKRs then serve as the basis for building out OKRs at the team level (in the form of specific 90-day action plans) and ultimately down to the individual level.

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ClientWise is the premier financial advisor coach focused on business development and management best practices for financial advisors.

Topics: Organizing Priorities

Happy Holidays - from our family to yours!

Posted by Irfan Raja on Dec 24, 2018 3:17:25 PM

On behalf of the entire ClientWise team, we would like to wish you Happy Holidays from our family to yours! In this season of giving, we are most grateful for that which you give to us...your friendship, support, and love.

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ClientWise is the premier financial advisor coach focused on business development and management best practices for financial advisors.

A History Lesson in Gratitude, Living and Laughing at it All

Posted by Ray Sclafani on Nov 21, 2018 4:41:03 PM

As we take time to give thanks and reflect on the relationships for which we are most grateful, we invariably recall certain history lessons that serve as important reminders to celebrate a life worth living.

At ClientWise, our team is most grateful for all the many lives we have impacted, the long-standing relationships we have forged, and the milestones and traditions we have celebrated together. We also take time out to give thanks for one another, for what we have achieved together, and to listen to what’s going on in each other’s lives.

There’s an old song from the 1930’s Broadway play Scandals, originally sung by Ethel Merman and later made famous by Rudy Vallee called “Life is Just a Bowl of Cherries.” The lyrics seem as fitting today as they were more than 80 years ago:

People are queer, they're always crowing, scrambling and rushing about
Why don't they stop someday, address themselves this way?
Why are we here? Where are we going? It's time that we found out
We're not here to stay; we're on a short holiday

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ClientWise is the premier financial advisor coach focused on business development and management best practices for financial advisors.

Topics: Leadership

Happy 4th of July

Posted by ClientWise on Jul 4, 2018 10:13:38 AM

Four Fun Historical Facts for Financial Advisors on the 4th of July

Happy Belated Birthday! In actuality, the real Independence Day, is on July 2nd. This is the day that Congress voted for independence. However, the written document wasn’t completed until July 4th. When the document was sent to the printer (John Dunlap) on July 4th, Dunlap printed that date in the announcement to the nation…and July 2nd became forgotten. Blame it on the printer!

 

Boom! Congress first authorized the use of fireworks on July of 1777. Today, according to the American Pyrotechnics Association, more than 14,000 fireworks displays light up the skies. For fireworks professionals, the 4th is kinda like Christmas for retailers, where they happen to do more than 90 percent of their revenues for the entire year.

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ClientWise is the premier financial advisor coach focused on business development and management best practices for financial advisors.