The Growth Equation: People + Processes (Specialization in a Financial Planning Practice)
There is a secret sauce to growing your business. While the foundations are the same, what works for everyone is different. Advisors who practice specialization in a financial planning practice, who hire the right people, have efficient processes in place, learn to delegate, and specialize roles within their firm tend to grow sooner than those that don’t. These are foundational for AUM growth, acquiring other practices, or selling their practice someday.
For a solo advisor, until hiring an assistant, there is no way to make more time in the day for relationship management or for acquiring new ones. For advisors teaming up, there’s a difference between dividing up clients, a.k.a., conquering by numbers just to have someone face them, and having the right people, processes, and specialists on board.
“One of our teams started around $100 million in AUM with three people and grew to approximately $620 million and became 97% fee-based over the course of 10 years. By hiring the right people, creating processes, delegating roles, and eventually bringing in operations specialists and investment specialists.” – Jake Saba, Vice President, Growth & Succession, Focus Financial Network
A Growth Story
Hiring the right people enables an advisor to meet with more clients and increase AUM, all while positioning the practice for growth. But the growth equation isn’t just about adding more people; it’s about creating processes, delegating tasks, having the right technology, and more.
“There’s an office with us that demonstrates how well an advisor treats their employees directly correlates with how their practice grows. The treat their employees as thought they are also their clients, and that trickles down to how employees treat the clients/investors. If the employees treat their clients well and have excellent processes in place, led by a team of specialists, they keep growing, and clients stay.” – Jake Saba, Vice President, Growth & Succession, Focus Financial Network
Financial Planning Practice Role Specialization
According to a study by Kitces Research, an advisor who is a ‘jack-of-all-trades’ only spends about 20% of their time in face-to-face client meetings. They’re the administrative assistant, financial planner, asset manager, marketing professional, compliance officer, and any other role that comes up. An advisor with employees in specialized roles spends an average of 30% of their time with clients, resulting in greater business and advisory growth.
As an advisor’s practice grows, role specialization becomes paramount. A solo advisor must establish a basic hierarchy for growth: a visionary (the advisor) and an assistant who serves as a scheduler, follow-up specialist, and back-office ninja. As the practice grows, the advisor must add more people to their team, each specializing in a specific role.
Next comes the operations specialist. Whether it’s the tech or the workflows, they must hand off these essential areas to a specialist or become overworked trying to manage them along with clients.
“We assist our advisors in hiring, delegation, and roles, and even onboarding their new employees.” – Jake Saba, Vice President, Growth & Succession, Focus Financial Network
Finally, the investment specialist is the next strategic hire. This person is responsible for researching investment strategies, creating portfolios, and, alongside the advisor, offering guidance at client meetings. This person handles most of the investment decisions, enabling the advisor to focus on client needs, building relationships, and bringing in new clients.
Having a job description and hiring are one thing, but advisors must implement processes and procedures and create a specialized role to support the person they bring in. Without that, they will be unable to perform their job well, leave, or be dismissed. And that is something clients always notice.
How Joining a Hybrid RIA Helps Advisors
Advisors can struggle staying up to date with their technology, marketing, or compliance tasks. Working with an RIA like Focus Financial Network that has specialists on board can help fill these gaps quicker, allowing the advisor more time to focus on clients and bring in new ones.
For advisors planning for succession, having a specialist to help them prepare for and handle the deal allows them more time to focus on their business and clients.
“One of my roles is succession, helping our advisors create a plan for mergers and acquisitions, helping them get financing, or doing the actual structuring of a deal. Our corporate staff is divided by specialty roles, which are necessary for growth and succession.” – Jake Saba, Vice President, Growth & Succession, Focus Financial Network
Just as customized as a financial plan is, every interaction and process a client experiences must be special. Treating them ‘special’ doesn’t come from investments; it comes from a team with clear roles, client procedures, and firm processes, which equates to outstanding relationship management.
From operations and investment specialists to succession planning and marketing professionals, Focus Financial Network equips advisors with a team to help grow their practice and position it for acquisition or sale.
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