Often, practices focus primarily on their client value proposition, and that’s important. While many advisers focus ‘below the line’ (on investments and products), I’ve proposed repositioning this to ‘above the line’ (people, goals and objectives) in the form
of ‘life-first’, real goals-based advice.

Clearly, there are other areas to consider in designing and building a world-class business. Let’s look at each of them.

It starts with you

There are various stakeholders in an advice business, and the principals are among them. Typically, principals are practitioners and employees, along with business owners. I see some advisers want to grow increasingly scaled businesses, while others are quite happy to maintain a lifestyle business. There’s no right or wrong but before you consider your business plan, ask yourself whether you have a personal plan. Are you clear what you want out of your life? In all our lives, we have a start, a middle and an end. We need to enjoy the middle bit. We have a limited number of days and hours. Precious time is slipping away. What do you want to do with your life?

Business vision

The key notion here, figuratively speaking, is taking a helicopter up to 10,000 metres for an overview and working on your business not just in it. And not just once a year, but regularly. It’s an old saying but a good one: ‘If you fail to plan, you plan to fail.’ I continue to meet an alarming number of advisers and principals without a documented business plan, or who don’t regularly review, monitor and update the one they do have.

Have you considered a formal board or an advisory board structure? (The difference, of course, is a formal board has directors. An advisory board has advisers to the board, without formal governance, regulatory and compliance responsibilities and associated risks). Certainly those businesses with growth aspirations, who have annual revenue at or greater than $1 million to $1.5 million, and typically 5-10 staff or more, need to consider this. We can all benefit from fresh eyes, objectivity, mentoring, coaching and accountability. Take the best athletes as examples; they typically have a coach, or a team around them. (Unless you are Nick Kyrgios, and therein lies the point – enormous unfulfilled latent talent and potential.)

What about your current and prospective organisational structures – which tasks and roles are you undertaking? Which do you enjoy, and which could you delegate? What tasks do you undertake that you detest? Are you using the notion of leverage, working on ‘the highest and best use of your (and everyone else’s) time’? Draw up a chart of all the roles you fill, all the ‘hats’ you wear, then ask yourself what would need to happen for you to get out of each of those roles.

Have you considered future organisational charts, based on expected growth rates, to determine what your business might look like after one, three and five years? What roles need to be filled and when? What will the drivers be?

These are not easy decisions for businesses, as new hires mean increased expenses and, typically, shorter-term pressure on margins. But we need to invest in our own business and people to grow. Evidence shows greater EBIT margins are available to those who make the hard decisions and push through the barriers and glass ceilings.

Client value proposition

Historically, many clients, certainly in a commission-based world, have received suboptimal value propositions. In a fee-based world, an issue that I am sure will surface over the next period from some quarters will be ‘fees for no service’.

I strongly feel more people would seek out advice from client-centric, life-first, goals-based advisers whose value proposition is focused ‘above the line’. The keys to an above-the-line value proposition are reflected in the following statements:
‘Really know me and my family. Understand me, help me, simplify me, de-clutter me, reduce my anxiety, and help me achieve what’s important to me.’

One of the challenges is that prospective clients often have the view that an adviser’s value proposition is ‘below the line’ – investing. Rarely would a prospective client proactively ask for a financial adviser to help them achieve their goals and dreams. They typically ask you to help them with their investments. My view is that there is a difference between what they want, and what they need. Many don’t know what they don’t know, and certainly don’t understand that the adviser of the future can help them achieve their goals.

Working on the value proposition, we need to make sure you and the team can articulate the basic building blocks. This would include both your business and personal ‘why’. Why you, and why your business?

Successful businesses are able to articulate their ‘why’; most articulate their ‘what’ and ‘how’ – what is often referred to as an ‘elevator pitch’. That’s how you articulate and summarise what you do in, say, 30 seconds? But where do you add value? You might also want to consider defining and working on the following areas: