It’s an approach that has served many financial advisors well, but it’s not a recipe for building a durable business that can achieve sustainable growth. To achieve that, you need a strategic onboarding plan – something few financial advisors have because it requires taking a considerable amount of time to build a clear vision for the business and the technical skills, relational skills and problem-solving/decision-making skill sets that will be necessary to realize that vision.
Odds are you never got into the business to be a manager, let alone the CEO of a large firm. But as your business has grown over the years, and continues to grow, your role needs to evolve and your financial advisory team needs something more from you – not just rainmaking but leadership.
It requires that you cast off your jack-of-all-trades cloak and instead become more of a visionary, thoughtfully and strategically focusing on the experience and skill sets that will be needed down the road to ensure a continually high-performing financial advisory team and an exceptional service organization with enterprise value. Keep in mind, that in order to sustain growth, you need to add capacity before it’s required, not when you’re scrambling to keep up with client demand and desperate to get a body onboard.
Some financial advisor owners recognize that it might be in their best interest to hire a CEO and not try to fulfill that role themselves. Others forge a more traditional path by focusing their efforts on whatever they do best and surrounding themselves with complementary people.
It can be a successful approach, but understand that it’s small firm thinking, not visionary, and will likely limit your firm’s growth potential enterprise value significantly.
Perhaps you’re a wizard at constructing investment portfolios and love that aspect of the business. Merely surrounding yourself with a team that can handle all the rest of the relationship management, trading and compliance functions isn’t going to be enough if you envision a business that’s also providing outsourced portfolio management to other advisors. In that case, you may need to consider onboarding a strong analyst and an additional portfolio manager sooner than later.
Your long-term goal should be to become an owner of the business rather than an operator in the business. Whether or not you want to remain active in the day-to-day running, think about how you can work yourself out of a job by strategically onboarding the best people to perform the work you envision. Not only will it free you up to focus more on looking ahead, removing yourself as an essential cog in the operation will also greatly improve the enterprise value of your firm when the time comes to exit.
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