- Scalability is a key challenge for all growing businesses because it requires time, strong leadership, the right people, and good resources.
- While some of these obstacles can be overcome, developing customised solutions that are repeatable and sustainable, builds a much stronger platform for growth.
- Managed accounts provide a great business transformation tool to help take advice businesses to the next level, however they need to be properly assessed in this context if they are to suit this purpose.
Building a financial advice business is tough. Building a scalable, growing and highly profitable business is even tougher.
For smaller practices with limited resources, which rely heavily on their principal to manage the day-to-day, creating an environment for growth can sometimes feel almost impossible.
But by adopting some tried and tested mindsets, you will be better placed to meet the challenges head on.
Here are five mindset changes that could make all the difference when growing your advisory business:
Mindset #1: Give yourself thinking time
A key challenge in growing in any business is finding the time to step back from the mounting day-to-day tasks to think about what’s holding it back and where you’d like to take it – that is, finding time to work on your business, not in it.
It just requires some discipline and can be as simple as crossing off regular times in your diary well in advance.
A useful tool to keep you focused is McKinsey’s Three Horizons of Growth, which requires you to categorise your goals into three “horizons”: maintaining and defending your core business, nurturing emerging business and creating new business.
Mindset #2: Foster innovation
Many heads are better than one. Why not get your staff involved in your thinking time with a team brainstorm or an innovation workshop?
Also work on creating an environment that encourages innovative thinking and inspires staff to share ideas and recommend solutions to problems. To do this, it’s crucial to have an honest and open workplace where people feel free to speak up.
You could also follow tech giant Google’s examples. It lets its employees spend 20 per cent of their time on creative projects in order to unlock innovation. It also has a “collaboration” space that promotes staff interaction. That’s because informal discussions often lead to good ideas and solutions.
Also consider hiring people with different perspectives to yourself and if you do use an idea, make a big deal about it and implement it as quickly as possible to show that suggestions are valued.
Mindset #3: Finding and retaining staff
To avoid ad hoc hiring and inefficiencies as you grow, do an audit of your current and future staff needs. Investigate how you can meet your requirements more efficiently. For example, you might benefit from cross-training some staff members to do more than one job or from using a mix of full-time and contractors to keep the business flexible as it grows.
With staff replacement and retraining costs so high, it’s just as vital to focus on retaining good staff – for instance, by having an effective induction program, offering opportunities to develop skills and being serious about exit interviews so that you know why people leave.
Part of any training and induction processes should also focus on creating a consistent customer experience and maintaining your service standards as you grow.
Mindset #4: Your time matters
Stick to what you do best. Part of successfully scaling your business is to acknowledge that your time is more valuable than ever. Try to work smarter, not harder.
Do a time audit to understand where your time goes and how it can be better managed. Do your most taxing tasks when you have your most energy – for example, first thing in the morning.
Focus on where you add value and consider delegating or outsourcing the things that other people may perhaps do better than you. And surround yourself with people who save you time, not drain you of it.
Consider adopting agile process management methodologies to help you and your team better prioritiese tasks and your time.
Mindset #5: Technology is your friend
Automate as much as you can to free up time and improve your operating efficiencies.
Examine how you can use technology to lower the costs of servicing additional clients as your business grows. Also look at how you can leverage technology to provide highly customised solutions to your clients and differentiate yourself from others.
The Netwealth AdviceTech Report, released in June 2017, contains great insights into the opportunities technology can offer advice practices, particularly when it comes to scaling.
For example, the use of managed accounts is gaining in popularity with 59% of advisers anticpated to use them by 2019. Managed accounts, for many advice practices, can be highly effective in helping scale the investment processes. They allow you to monitor, transact and rebalance across multiple tailored client portfolios in a cost efficient and transparent way.
With this improvement in effeciences, Managed accounts can free up your time so you can scale your client engagement efforts to better engage with wide range of clients, from HNWs to retirees and accumulators, and especially those looking for transparency and to outsource strategic portfolio decisions to experts.
To find out about how technology and managed accounts can help your growing business, why don’t you have a chat to one of the Netwealth team.