 Many advisors fall into the trap of thinking about doing some great new thing for the business but never getting around to it because there is so much other stuff to do. If you are ready to break that cycle, here’s a proven way to follow through on your best ideas.
Advisors, just like people in general, don’t usually have a problem knowing what we should do. The problem is that we just don’t do it! Even when we know how much better things could be if we did!
Did you know it happens in professional sports as well? If you follow basketball and its history, you know that Wilt Chamberlain once scored 100 points in a single professional game. You also know he was a lousy foul throw shooter, though in that game he was 28 of 32, shooting underhand like Rick Barry. In his autobiography, Chamberlain wrote this on the subject of shooting underhanded: “I felt silly, like a sissy, shooting underhanded. I know I was wrong. I know some of the best foul shooters in history shot that way. Even now the best one in the NBA, Rick Barry, shoots underhanded. I just couldn’t do it.” Shooting underhanded is known as “the granny shot.” Speaking of knowing what to do and not doing it! Rick Barry also tried to get Shaquille O’Neal to shoot underhanded. Shaq said, “Forget it, I’d rather shoot zero than shoot underhanded.” In the world of football, research by Thaler and Massey said football teams should trade away their first round picks. They should stockpile players in the second and third rounds, who can be paid a lot less and are nearly as good. This is how you build a winning football team. NFL teams spoke with Thaler and Massey, yet no one took their studied advice. NFL owners sometimes trade a pick in this year’s draft for a pick in some future draft. They use a rule of thumb to figure out how to value the difference between a player you can use this year versus a draft pick you can’t use until some future year. Thaler and Massey discovered the rule of thumb makes no sense. It’s completely irrational; it massively overvalues current picks and undervalues future picks. They valued that rule of thumb as borrowing money at an interest rate of 137% per year. The owners pay a huge premium, but again, no one has ever followed the researchers’ advice. In your business life…
I could go on…but you get the point. What do you know you “should” do but have not done? How can you get off the hamster wheel? You are not alone Look, you are not alone. I, and many others, are right there with you. Following through is a challenge for all of us. The questions are:
Let’s first understand what’s going on with us. Why don’t we follow through? Mike Lejeune in his article “The 7 Reasons People Don’t Follow Through and What To Do About It” says there is a common thread in all of the reasons that stop people from following through on their word or plans. And he defines seven root causes and nine actions you can apply to overcome those causes. Lejeune’s article identifies several related reasons for not following through including:
These are all good points. His article suggests nine actions you can apply right away to overcome this…
The 3 secrets to follow-through for advisors As an advisor, you can boost your follow-through by creating a business plan that will address all seven reasons and all nine actions. And you’ll build this business plan through a particular approach, which I’ll describe below. Yes, I know, you’ve heard it before and you hate doing business plans whether one-page or 50 pages. Get over it. If you want to be a better FA, build a business plan. The “secrets” are...
A good business plan can be completed easily and quickly if you have a good team putting it together and take just one day in an offsite location. That is how it is best done. The team should include all team members, including junior members. For all members, it’s a great learning experience. Junior members often have fresh ideas viewed and view things from differing perspectives. And of course, it’s a bonding experience for all. An outside facilitator can also be an excellent addition to this process, whether it is a manager who has done this before or a business coach (yes, a shameless plug). The power of your plan What does your practice look like? Is it managed chaos or calm and effective? The key question is: Why are the calmer, effective teams able to manage their time more effectively and efficiently? The answer lies in the planning that these teams do in advance. These teams have a very deliberate business plan. They have decided whom they want to work with and how many clients they can serve effectively, and they have a clear service definition for exactly what they are going to provide for each client. They have a set of goals, strategies, tactics, and action plans. The calm effective teams have realized they cannot run a practice without having a business plan and without planning their time well. A plan gives you purpose A full business plan is used to help run your company with a more cohesive vision. It is your roadmap. By truly analyzing your plan for marketing, sales, manufacturing, website design, etc., you greatly improve your chances for following through and succeeding in these areas. The type of plan we discuss below is primarily oriented to business development/growth, efficiency and effectiveness. What is included in your business plan? In its simplest form, a business plan is a guide—a roadmap for your business that outlines goals and details how you plan to achieve those goals. For many, if not most, FAs and planners, we suggest a base business plan should include the following sections:
How to develop your FA business plan It is a fairly simple and fast process that can be done by the advisor and her or his team in a planning session and fleshed out quickly. (You can find a detailed example in my book, The Financial Advisor’s Success Manual.) Before going into the business plan, I believe it is an imperative to have completed a client segmentation analysis, dividing clients into appropriate service tiers and to have a well-constructed service strategy. Then your planning approach can essentially be a marketing and sales plan, as suggested above. Start your process with a number of key questions so you know how to get from where you are to where you want to be. The focus in this plan is on client and asset growth. We start the plan with several base questions in the review of last year:
Attach a value to each strategy The plan should include enough detail to establish rough value for each marketing and sales strategy.
Does the first example have a higher priority than the second? Yes, in the near term. In the longer term, it depends. That’s a judgment the team will have to make when you do time planning, which was mentioned previously. Budgeting your time Part of the business planning process is determining how much time you can and want to devote to each major task. You will also want to define roles and responsibilities at a high level.
A word (or two) about the stress factor A survey by psychologist and self-help author Robert Epstein found that the stress management technique that worked best is planning. In other words, “fighting stress before it even starts, planning things rather than letting them happen,” says Epstein. “That means planning your day, your year and your life so that stress is minimized.” Let’s face another reality. If you have 100–150 clients (or are striving to get there), $100,000,000 to $200,000,000 in AUM entrusted to you (or are striving to get there), and you are earning $100,000 to $250,000 to $500,000 a year or more, your work is complex and stressful. Especially if you are a person prone to feel stress anyway. As Tom Hanks said in A League of Their Own, “It’s supposed to be hard. If it were easy, everyone would do it.” Remember also that the June 2018 median household income in the United States according to Sentier Research was $62,175. Keep things in perspective. There are many techniques to reduce stress and some to make your work easier, but you know you have a lot of responsibility to a lot of people. It comes with the territory, as they say, but having a solid plan in place, reviewing it with your team on a very regular basis, e.g., monthly and quarterly, will contain stress. It will help you know what you should be doing and whether you are doing it. As Gandhi advised us: “Happiness is when what you think, what you say, and what you do are in harmony.” Once the plan is in place, execution is critical, i.e., time to follow through! Get to work with the same admonishment as before, “Don’t do it alone.” You have a team! Accountability Your last step is to establish accountability for all tasks and assignments using the tools we put in place. “Accountability eliminates the time and effort you spend on distracting activities and other unproductive behavior. When you make people accountable for their actions, you’re effectively teaching them to value their work. When done right, accountability can increase your team members’ skills and confidence.” Check out this article from Forbes, in which the writer argues that “…accountability is probably the single most important element fueling truly successful organizations.” He goes on to say: Poor follow through—failing to keep important promises to ourselves and others—does a lot more than just threaten our health. It takes a toll on virtually every aspect of our lives. It prevents us from achieving personal, financial, and career goals that should be well within our reach. It damages our relationships, produces stress, and creates regrets. It robs us of credibility, self-esteem, and peace of mind. Poor follow through deprives us, our families, our businesses, and our communities of the full benefit of our intelligence, talent, imagination, and hard work. I’ve learned that a good intention won’t work unless I can find a way to keep it on the front burner. That’s just the way it is. You can have an accountability person on your team who is rewarded for that work and is part of her or his metrics and success. Or again, consider hiring a coach. Now start planning—and following through—on your steps to success! David I. Leo David Leo is the founder of Street Smart Research Group LLC. He is an author, speaker, coach, consultant and trainer to financial professionals. David is an experienced business manager who works solely with financial advisors, planners and firms who want to organize, structure and grow their businesses by attracting, servicing, and retaining affluent clients. Contact him at [email protected] or call 212-598-4229. Some of the material from this article comes from several sources including:
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