Who Is Advising Financial Advisors?

If you do not have a mentor, coach, or branch manager, who is advising your business? Brokers and dealers and MGA’s are constantly trying to help financial advisors. They do a great job with product, planning, and client service. Can they tell you how your business is running? Do they have diagnostics to tell you, and research to support it? Do they know how to help you in areas you want to improve? This is called benchmarking.

What is benchmarking? 

We use a tool called the "Advisor Practice Management Benchmark Report". It covers both qualitative and quantitative aspects of your financial business.  The report gives you an independent assessment of your strengths and weaknesses across 30 different areas. Nothing is stopping you from improving your business. That's the problem. A lack of data prevents many financial advisors from reaching their full potential. A benchmark is a unique and innovative assessment tool. Thousands of financial advisors have benchmarked their practice across Canada USA and the world. The report includes the data from those successful practices. What else is everyone doing?  

Why would I benchmark my practice? 

Financial advisors who benchmarked their practice are more profitable. Financial advisors who meet with an external adviser/business coach at least quarterly are 89% more profitable than those practices who aren’t. (Data extracted from Future Ready VIII, Insights into the Australian Advisory Profession, Jan 2020, Business Health Pty Ltd).  It is the same reason why people don't want a comprehensive financial plan. They don't want to know how many gaps and opportunities there are for their future. You know the power of planning and advice and putting together a list of action steps to help people reach their goals on paper. Now you understand what benchmarking is and can be for your financial advisor practice.

What do you do with a benchmarking report? 

Just like a financial plan, it will give you a checklist of action items or an implementation schedule, and now you know what to do. It will give you step by step on what to do in different categories of your business. Here are examples of the five categories benchmark examines in your financial advisor practice.

Ideal clients, how often do you segment,  How do you deliver value-added service, and ensure consistent communication?

Clarity around your comprehensive business plan- Understanding your mission vision values and your exit strategy

Growth planning, acquiring new ideal clients and your onboarding process, reputation management, and time management

Capacity, managing your team, growing your team, managing technology, and growing your technology

Key performance indicators- critical data to making big decisions about your business going forward.

Here are some examples of decisions that financial advisors had made as a result of their benchmark.

  • Finding, meeting, and acquiring more ideal clients
  • Less is more, finding more ideal clients and having fewer clients in the future
  • Developing a proven scripted process for all team members
  • Building a robust onboarding process and deeper communication plans
  • Delivering more value to ideal clients while delivering consistent communication to all clients
  • Getting a deep sense of clarity of the direction of your practice's future in 1 year 3 years 5 years and 10 years on paper
  • Developing a training program in a career path for team members including an organizational chart
  • Finding ideal capacity and running the business not letting the business run you

 At least, it‘s worth a discussion. 

Given the extreme challenges of today’s marketplace, surely these financial advisors would benefit from some critical data and expert input and advice. A poll conducted by Risk Info adds further fuel to this discussion; 65% of business owners stated that they do not intend to utilize external input in the next 12 months to better manage and build their financial advisor practices.

As financial advisors are writing out their short and long-term goals, an ideal opportunity exists for financial advisors and their firms to help them run a better business.

Related: Advisors: Do You Have Clarity About Your Future?