Why Financial Advisory Firms With Growth Ambitions Need Strategic Planning

Written By: Ginny Hudgens | The Strategic Implementer

Ever felt like you're pedaling on a stationary bike in the world of advisory? Working hard but not getting far? I’ve chatted with many financial advisors, and the strategic planning story is the same. You're buried under the day-to-day of your firm, managing staff, compliance, creating a great client experience and on and on. Whew! So, squeezing in time for your own business planning feels like a luxury.

Pro Tip: Growing isn't just a choice now, it's survival. And planning that growth? Man, it's like trying to find a needle in a haystack. Where do you start? What’s the most important now? And in the long run? Will changing things up break the bank? Trust me, I’ve been there with 100’s of Advisors. 

But planning? It’s like having a GPS for your business. No more wandering around hoping you’ll get to your destination. You decide where you want to go, and we help you get there.

The Fastest Growing Advisors Have a Game Plan

In the Schwab’s Mastering strategic planning, A practical guide to charting your firm’s future, we find that loads of financial advisory firms want to grow (big surprise); but, here's the kicker. A whole bunch of advisors don't even have a game plan. Yep, that's right. They’re running blind.

However, those with a strategy are making waves. But don’t just take our word for it, the numbers don’t lie. The go-getters in the business, about 75% of them, have a strategy penned down.

As you scale up, it’s not just about adding more to your plate but ensuring that what is there fits perfectly. Navigating growing client lists, tech challenges, and the ever-evolving market can get overwhelming. That's why a plan isn’t just nice to have; it’s essential.

How Strategic Planning Drives Growth and Differentiation

  • Firms on a growth path must make critical choices and manage tradeoffs along the way. A well-conceived strategic plan becomes the road map that defines the firm’s mission, articulates leadership’s vision, establishes goals and objectives, and creates the framework for making decisions to move the firm toward its vision. There’s no guessing or second guessing. But if some aspect of the plan isn’t working, at least you’ll know why and have a framework for fixing it. 
  • Having a strategic plan that’s communicated broadly and regularly ensures a firm-wide alignment with its visions, goals, priorities, and values, which is a hallmark of many of the best-performing companies in the world. 
  • For firms with growth ambitions, it’s just as important to know what not to do as it is what to do. Top-performing firms use their plans to keep laser-focused only on what’s essential, with a clearer understanding of how to manage tradeoffs and how best to invest resources to optimize return on investment. 
  • It’s in the strategic planning process that firms are able to assess the internal and external factors that represent threats or opportunities to their growth ambitions. With competition intensifying and clients demanding more from their advisors, financial advisory firms must find ways to differentiate themselves. The strategic planning process allows firm leaders to explore their purpose and values and strengths and weaknesses to create a differentiated competitive strategy, showcasing its commitment to attracting and retaining clients as well as top talent. 

Getting Started with Strategic Planning

If you're shooting for the stars, a roadmap is your best bet. I mean, in a world full of financial advisors, having a clear strategy is your ticket to standing out in the crowd.

Related: Why Financial Advisors Should Continue To Hire in a Volatile Market