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I enjoy attending industry conferences. With thought leaders, scholars, authors and consultants ably imparting their wisdom and kindling attendee enthusiasm, I often find myself taking copious notes, getting inspired and motivated to return home and share what I learned with my clients and my colleagues.
And yes, comparing notes with colleagues facing similar challenges is immensely valuable.
At the same time, however, these conferences remind me of a poignant gap between where most founder-centric advisory firms are today and where they could be. I often walk away thinking to myself:
With such abundance of information and all the vendors displaying their latest state-of-the-art tools, only a handful of firms truly rise above to become elite firms. The rest barely tread water or even decline. Yet, virtually all of the attendees I befriended here tell me that they attend the event almost every year. How is it that there is so much good information with so little results?”
Let’s be clear about a couple of things.
Some founder-owners of wealth management firms want to keep their firms small by design. They enjoy their income and lifestyle and have little desire to grow their firms beyond their current size, other than incrementally. They want to practice financial planning, not run a business. One downside to their decision is that they get slightly annoyed at industry conferences where attendees’ worth seems to be measured by the size of the assets they manage. Otherwise, they are content with things as they are.
Second, bigger isn’t always better. The truth is, some (many?) larger firms lack a clear strategic direction. They grew by hiring advisors with books of business mainly to grow assets. They often have muddled compensation structures, murky career paths and uninspiring strategic visions. Others are just haphazard conglomerations of producers, each with his or her distinct investment philosophy and strategy, ideal client and value proposition. They are “advisors with benefits,” sharing the costs of managing their respective books of business, but not much beyond that.
But there is one primarily reason for the lack of results.
If you are one of these founder-owners who genuinely wants to grow and to transform your practice to an enduring business with a transferable enterprise value, the reason your firm has plateaued is you, the founder-owner.
Specifically, you have yet to make a shift from being an advisor to being an executive. In effect, your firm is missing a leader – though unwittingly – who is charged with taking it to the next level. The unfortunate outcome of your firm’s lacking a bona fide executive is that you may be the very person getting in the way of your firms’ growth – and slowing things down. This is because by virtue of your status as the founder and owner, you have the title of CEO by default, but not doing the job of a CEO. It’s an innocent “mistake,” to be sure, but a consequential one.
Thus, to take your firm to the next level, it’s critical that you commit to learning some new skills to become an effective executive. As with any meaningful work, an executive job requires a unique set of skills and experience to perform well. It’s not “rocket science” and it can be learned, but it does take diligent study and practice to be effective at it. So be ready to hit the books, be coached and practice diligently.
