What does it take to build a high-performance team? My analysis shows that the best advisors follow two distinct approaches.
Last week, in my article The Skill Set for Exceptional Performance, I featured an email from a successful advisor named John on managing staff to support continued growth. John, the co-managing partner of an 11-person team, said that dealing with staff as they’ve grown has been by far his biggest challenge.
I also quoted one expert who observed that “what it takes to build an initial business, which is driven by the founders’ skills and energy, is very different from what it takes to run a bigger business, where you need to lever the skills of employees.” To learn more, I hosted a series of lunches with top-performing advisors to talk about what it took to build their teams. The advisors at those lunches identified seven discrete steps (shown in the graphic below) for building and running the teams that are integral to their businesses
Last week’s article talked about the role of mission and culture. This week’s piece outlines what I heard about definining roles to make a team run smoothly.
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Generalists with specialized expertise
Joanne is one of three partners in a super team with 18 advisors and support staff spread across two offices. She described her team as a group of like-minded people with complementary skills.
“In a world that’s getting more complex, clients demand specialized advice,” she said. “All of our advisors are generalists who can talk knowledgeably about any aspect of clients’ finances and know enough to ask the right questions. But then each advisor has one or two areas of specialization on which they are experts and have deep expertise – asset allocation, tax planning, trust structures, life insurance and annuities, direct investments in real estate or charitable giving. Those advisors go to conferences and invest the time to make sure they’re at the leading edge in their areas of focus.”
Philip was one of three advisors at the lunches from a large team that has hired a chief operating officer to manage daily operations.
“We take the view that the only really good use of time for advisors is being in front of clients and prospects,” he said. “We’ve structured everything we do to allow us to focus on client-facing activities. Five years ago we hired a CPA with experience in the investment industry to run our day-to-day operations. All the support staff report to her and she’s put in systems to automate every aspect of our business, including tracking the experience that clients have working with us. The only area that she doesn’t get involved in relates to portfolio construction – that’s managed by one of our partners who has a CFA and oversees a couple of outside firms to whom we’ve outsourced the investment process.”
Bringing new clients on board
There were different views on who should be responsible for attracting new clients. Given the importance of bringing new clients on board, on some teams every advisor is expected to focus on client development. In other cases, client development is the principal responsibility of a few advisors, typically those who are the most senior and the best connected.
Mark is a partner in a team where all the advisors have client-development responsibilities: “I’ve seen other teams where some advisors are comfortable being client minders and get complacent as a result,” he said. “We take the view that if we want to grow, even the most junior advisor has to make a serious commitment to bringing new clients on board.”
Jason’s team has the opposite approach: “While we want everyone to look for chances to attract new clients, the opportunities for junior advisors aren’t in the ballpark with a senior partner who’s been in the business for 20 years. At the beginning of each year, we agree on the weekly hours that every advisor will spend on client development. This year it varies from three at the low end to 20 at the high end. The hours that junior advisors spend with clients free up time for our senior advisors to get out in the community. It ends up being a better use of time for both the junior and senior members of our team. It’s worth noting that as advisors get more experience, they are expected to spend more time networking and to put more focus on client development.”
Assigning clear responsibility
There was universal agreement on assigning clear responsibilities for tasks. “If it’s everyone’s job, it’s no one’s job,” said Patricia. “A few years ago I had two assistants who shared responsibility for dealing with all of my clients. When something went wrong getting paperwork out or when a follow-up call hadn’t been made, there was always a certain amount of finger pointing. That ended when I split my client base in two and gave each assistant primary responsibility for one half of my clients. From the moment I did that,” she said “both my assistants began taking much more ownership and I saw a significant improvement in productivity – not only that, but I began getting more compliments from clients about the assistant they were dealing with being responsive and how proactive she was.”
Assigning clear responsibility for key tasks was something that resonated with many of the advisors at the lunches. One typical statement came from Brian: “Our goal is to have a kickass team that is going to outperform every other team in our market. We make someone responsible for every meaningful task, whether it’s getting our newsletter out, organizing our quarterly outlook lunches or ensuring that we are following up with prospects. If a job is important enough, new business development for example, we’ll share responsibility for overall management of it across a couple of people.”
Susan described how her firm had addressed one problematic issue: “We were having difficulty getting people to enter data on client conversations into our CRM system. We put together a three-person committee – two advisors and one senior admin person. We agreed on several initiatives to address this problem, including giving the admin person responsibility for monitoring the extent to which everyone records client conversations. She sends a report around every month that shows the percent of conversations recorded for every individual in our firm. Since that came out, we have seen a meaningful change in behavior.”
While these advisors came from large teams, the principle of assigning clear responsibility and accountability applies to every advisor with one or two support staff. Next week I’ll discuss what successful advisors are doing to motivate team members and attract the right people.
Dan Richards conducts programs to help advisors gain and retain clients and is an award winning faculty member in the MBA program at the University of Toronto. To see more of his written commentaries, go to www.danrichards.com or here for his videos.
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