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What We Can Learn from Career-Changer Advisers

Do you know a career-changer adviser or have one on your staff? They bring a certain skillset that many lifelong financial advisers may benefit from.

One individual I know retired from the military and began his career as a financial adviser when he was in his 40s. He was quite comfortable in his role as leader of a growing ensemble firm. He was adept at enhancing efficiency through the use of consistent processes, attending not only to the firm’s top line but also to margin and profitability, delegating to staff, focusing on teamwork, mentoring young advisers and building a culture of camaraderie. These aren’t usually the responsibilities advisers say they excel at; instead, most say they much prefer spending time with their clients than managing the business.

Can we assume, then, that some career-changer advisers are better business managers than financial advisers who have spent their entire careers in this industry?

What Career Changers Bring
There is no actual data to validate my hunch, but if you think about it, there are a few reasons why an adviser who came from the military, engineering, health care or some other industry would find success as a business owner. Let’s look a little closer.

Lifelong financial planners often have no formal business training; after all, you don’t get CE credits for learning how to be better businesspeople. In fact, at conferences, there’s a built-in incentive to go to the sessions offering CE credit and a built-in disincentive for the practice management sessions. Consequently, developing or enhancing leadership and management skills or business acumen in general plays second fiddle.

When an individual starts a second career, however, there is an opportunity for a do over. You get to assess the new industry you are joining and learn best practices to apply from the get-go? (if you had the chance to start your financial planning career over, wouldn’t you do some things differently?) Plus, those who change careers have often learned from their earlier experiences and know how to avoid certain bad habits the second time around.

Of course, career changers are often older and more mature. That maturity may also be accompanied by greater financial stability than a newbie adviser just entering the industry would have. For example, instead of taking on every client to make ends meet, the more established individual can select the clients who best fit his or her niche and how he or she wants to present the firm to the public.

Last, there is something to be said for bringing external knowledge into this industry. That’s probably true for any industry. It’s not a leap to suggest that prior experience leads to increased wisdom.

If This Is True, What Difference Does It Make?
If you have a career changer in your firm, perhaps that individual has insight that could be useful to you as the leader of the firm. If you are considering a career changer as a successor, that individual may possess some valuable skills less commonly found in the financial services industry. Consider also that, as our industry shrinks, perhaps we need to recruit from non-traditional niches.

If it’s logical to assume that career-changer advisers often possess better business management skills, then it follows that financial planners who switch industries might be observed to have exceptional relationships and, of course, financial planning skills. It’s just that financial planners seldom move on to a second career. Why would they, when this one is so gratifying?

Joni Youngwirth_2014 for webJoni Youngwirth
Managing Principal of Practice Management
Commonwealth Financial Network
Waltham, Mass.


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The Value of Time and Experience

I recently visited an adviser whose business had grown very quickly. In a five-year period, he went from one employee to five and his production tripled, easily putting him in the seven-figure range. In comparison with many other advisers with similar businesses, this adviser is 15 years younger, on average and has a commensurate 15 fewer years of industry experience. Listening to his business challenges—especially those having to do with human resources—gave me pause. Did this adviser have more people problems than most or was something else going on?

Getting Better Vs. Getting Used to Things
In considering this young adviser’s situation, I believed one of two things was going on:

  1. He had not yet developed the skills necessary to manage staff, which was actually contributing to his issues.
  2. He had not yet recognized that people issues are an ongoing component of managing a business.

For example, the adviser felt that he needed to revise job descriptions and re-create a compensation system that would more specifically motivate the behaviors he desired. He wanted his employees to take more responsibility for producing error-free work, instead of depending on him to review their work and catch errors. The issue extended beyond his support staff. He had recently brought on a staff CFP® and discovered that the process of guiding and mentoring the young woman required a significant investment of time to help her understand how to apply financial knowledge and theory to clients’ reality. That’s not to mention the time he was spending helping her evolve business development skills. When I asked how much time he was investing in managing the business, he said 50 percent.

But is that really too much? Comparing his story with that of other advisers with similar business scale and capacity, I found that they were far less verbal and seemed less frustrated with their human resource situation. What was particularly thought provoking was that the young adviser had assumed he must be doing something wrong or that there was something wrong with his organizational model.

We’re Never Done
There is no doubt that if we make the effort to improve, we get better over time. We learn how to manage resources—time, money and people—more effectively. What this young adviser had yet to learn was that he was doing just fine as a manager. The reality is that just when we have things lined up to achieve the perfect organization, a lot can change—someone gets sick, leaves for a different job or needs to implement new technology or procedures, which actually causes him or her to be less effective and may even lead to performance issues.

The longer we spend in a leadership position, the more we learn that when things are going well, all we have to do is wait a bit—they’ll change! The good news is that the reverse is also true. When things are not going right from an HR perspective, focusing your attention on the issue can help improve it. The fact of the matter is that we are never done managing our people. And that’s the real value of time and experience.

Joni Youngwirth_2014 for webJoni Youngwirth
Managing Principal of Practice Management
Commonwealth Financial Network
Waltham, Mass.


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6 Seriousness of Success Indicators

During a complimentary group coaching session with 60 financial advisers, I made a special announcement that for a limited time we would offer a very low monthly payment plan option on our upcoming group coaching series to anyone with five years or less in the business. I did this to try and help those in need who may not have the necessary funds for coaching.

The caveat: we were only taking the first 10 people who emailed me with their interest. Within minutes, we had more than 10 people contact me. However, only one ended up actually signing up for our group coaching program. My first thought was that the others simply didn’t see our follow-up email with the registration link. After calling the entire list twice and speaking with many of the advisers, I came to the realization that the real reason they were not following through on their initial interest was that they simply were not serious about their own success (and it had nothing to do with money after all).

The following are just of few examples of what I have found with my successful client advisers:

1.) They Are Serious about Commitment: Successful advisers know that making a commitment to own their success is not a gray area—either you are committed to succeed or you are not. This doesn’t eliminate setbacks but redefines them as opportunities to learn and move forward.

2.) They Are Serious about Character: Successful advisers know that doing the right thing for the client is much more important than earning a commission. They say what they mean and they stick to their word.

4.) They Are Serious about Consequences: Successful advisers know that they are responsible for their own success, not their firm, their clients, the market or the economy. They realize that it is pointless to blame others.

5.) They Are Serious about Collaboration: Successful advisers find others to help build and maintain a thriving practice. They utilize their firm’s resources and expertise. They oftentimes build teams with other like-minded advisers or hire junior advisers to delegate activities to that they themselves don’t like to do.

6.) They Are Serious about Control: Successful advisers know what is and is not in their control. They CAN control their attitude, activities and actions. They don’t worry about things that they cannot control, such as their clients’ attitudes, the market and the overall economy.

Obviously, I’m not saying you can’t have fun in your business but I am saying that if you want to get to the next level with your practice it’s time to get serious about your own success. Nobody else can, or will, do it for you.

If you read this article and would like help identify how to take your business more seriously, email Melissa Denham, director of client servicing at melissa@advisorsolutionsinc.com to schedule a free complimentary consultation with Dan Finley.

Dan FinleyDaniel C. Finley
President
Advisor Solutions
St. Paul, Minn.


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Learning about Leadership through Baseball

“Baseball is this huge analogy for life,” said Rebecca Herman, Ph.D., professor of leadership and organizational development at Kaplan University’s school of business. Herman spoke to FPA volunteer leaders about leadership and volunteerism at the FPA Chapter Leaders Conference in Broomfield, Colo.

Herman, a baseball fanatic and co-author of Lead Me Out to the Ballgame: Stories and Strategies to Develop Major League Leadership, shared the following steps to effective leadership:

Lead Yourself
To be an effective leader, you must lead yourself. According to Herman, this takes passion, leading by example, and respect. “Leading by example is one of the best behavioral lessons we can give our team,” said Herman.

Leading Others
The next step to effective leadership is leading others. To do this successfully, Herman says you must cultivate relationships (spend time with the people on your team each day), communicate effectively, and support your people. After interviewing dozens of Major League Baseball players for her book, Herman was shocked to learn that what players wanted most from their managers was support; they wanted their managers to have their back.

Leading the Game
This is what Herman considers your expertise. She encouraged the planners in the room—experts in financial planning—to stay up to date on their expertise, to foster teamwork and create a winning culture.

All these steps will lead to becoming a major league leader, scoring a home run and experiencing your own version of that champagne-popping moment of winning the World Series.

Schulaka Carly_resizedCarly Schulaka
Editor
Journal of Financial Planning
Denver, CO


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Managing the Business Development Process: A Key to the True Ensemble

According to a recent report by Cerulli Associates, financial advisers today are more likely to join an established RIA than to create their own advisory firm. Another study by InvestmentNews came to the same conclusion. Are these results surprising? Perhaps for some, but the talk regarding the emergence of ensemble firms has been around for more than a decade. Whether due to aging founder advisers who want their firms to continue after they’re gone, or to advisers who want to grow the top line, there is indeed a hiring frenzy by existing firms.

What happens after the frenzy has been satisfied and additional advisers are in place is another story. Unfortunately, “buyer’s remorse” can sometimes set in: Firm leaders who have failed to anticipate and prepare for the changes resulting from having additional advisers in the firm cannot achieve the intended results. So, what can be done to prevent this scenario?

As the leader of your organization, you should, of course, carefully craft the vision and business plan—and then drive that plan into reality. But one key to forming a true ensemble is the need to manage the business development process—sometimes referred to as the sales process.

Manage the Process
As advisers join your firm, they will need leadership and management to help them grow. You may find that it doesn’t cut it to go back to “business as usual” and focus your time as a financial adviser on only serving your clients. Be it loosely or with formality—and whether or not you call it “sales”—the business development process within a firm needs to be managed. To do this, consider the following:

  • Have individual advisers set revenue goals. This will yield the forecast on which future expenditures of the firm can be based. At least some of these expenditures should be for marketing efforts designed to gain new clients.
  • Track all activities. It is all too easy to service existing clients endlessly and never get around to prospecting. Keeping track of advisers’ revenue-generating activity will help provide some needed structure and balance to client-servicing activities.
  • Coordinate marketing events. This will ensure that firm-sponsored events and expenditures are embraced by all advisers within a firm.
  • Recognize success. Advisers need to be recognized for their achievements, as well as coached in areas where improvement is needed.
  • Evaluate techniques. By evaluating the effectiveness of different revenue-generating approaches, future time and energy can go into those prospecting activities with the highest return on investment. This is often referred to as tracking and assessing the effectiveness of endeavors of the sales funnel.

A Word to the Wise
If you love being a financial adviser and working directly with your clients but hate managing others and/or focusing on others’ growth, you might want to “stick to your knitting” and remain in a solo practice. And if you think that growing your business is as simple as finding another adviser to join your firm, think again. All work is a process—including business development.

Remember, you might establish a multi-adviser firm by hiring more advisers. But a key to forming a true ensemble includes actively managing your business development process.

Joni Youngwirth_2014 for webJoni Youngwirth
Managing Principal of Practice Management
Commonwealth Financial Network
Waltham, Mass.


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One Four-Letter Word Hindering Your Professional Success, and 4 Tips to Deal

FearWhat can prevent a good adviser from becoming a great adviser? The answer can be often found in one four-letter word: F-E-A-R.

Frequently, fear has deep roots in our pasts. Specifically, in our childhood when we first experienced the dreads of not fitting in, being rejected, being wrong or not being good enough. The latter is essentially at the root of all others. We fear that we will be rejected, lose relationships and end up abandoned because we aren’t good enough.

The majority of our fears are ingrained in false beliefs and have very little to do with reality. What are real, rather, are the powerful emotions triggered by fear. Ultimately, fear is a jarring emotion that gets amplified by the reptilian fight or flight side of our human make-up. Our negative self-talk can be so powerful to push the anxiety associated with our fear to a level where our response morphs into utter avoidance.

For example, one morning, you walk into the office and find a very animated voice message from a client asking you to call her back immediately. You recently invested for that client into a discounted closed-end fund, with the intent to liquidate it once the high discount narrowed. Unanticipated economic news instead moved the discount in opposite direction. Your mind begins its fear producing chatter: “Now she’s going to complain about her investment losing value. I do not want her to treat me like if I am a novice who doesn’t know what is doing. How can avoid making this call?

In reality, what frightens us most is experiencing the feeling of being afraid. Ultimately, that’s our greatest fear. Our mind possesses the power to distort supposed outcomes to levels beyond mere fiction. Fortunately for us, in real life most of the outcomes we end up experiencing—even the one we dreaded the most—are never as bad as we envisaged them.

Fear of failure and rejection are part of our daily life—both personal and professional. We must learn that when we fail or experience rejection, it’s not a personal matter; people are not rejecting you or me, rather they are refusing the ideas we are proposing. Failure is a vital component of our success. It enables us—as long as we commit to learn from it—to refine our strategies and make our skills pliable for future success.

Fear interferes with conscious awareness, clear thinking, true knowing and in turn conscious behavior. There is no shield against fear. It is a mental creation and the only antidote against it is to lessen and possibly break our mind’s fear generating process. Experiencing fear is natural, but enabling it to prevent you from growing your business can be disastrous. So, here are a few tips you may want to implement when facing fear:

Acknowledge Fear: Our first reaction is to ignore our fears and hope they’ll go away. The longer we avoid them, the louder and nastier they become. By mindfully bringing our awareness to our fear, instead of just fighting or fleeing, we develop the courage needed to confront it.

You Are Not Alone: Understand that you, just like the rest of the people and animals on this planet, feel fear. Instead of ignoring it, experience it and try to look into its nature. Understand that ultimately it is just an impermanent and transitory feeling with no true inherent power of controlling your life.

Beginner’s Mind: Approach your fear as if it were your very first time facing it. Because every single experience in our lives is unique, you have never confronted this specific fear before, ergo, you do not know the endless possibilities associated with it. Keeping a beginner’s mind—an attitude that encompasses both doubt and possibility—empowers us to see any situation as fresh and new and be a huge game-changer.

Be in the Moment: Seek to quiet your mind and let go of any thoughts of past mistakes and what may happen in the future. Focusing on the present moment will help you trust that if you fail, you can be proud to have tried. Ultimately, let the old adage “fear the fear and do it anyway” be your ultimate goal.

Claudio PannunzioClaudio O. Pannunzio
President and Founder
i-Impact Group
Greenwich, Conn.


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Leaders: Born or Made?

leadersThis question came from a participant in one of my strengths workshops.

“Are certain strengths or characteristics common in leaders?” the participant posed. Many questions along this same line have been asked about leadership over the years. What do you think the answer is?

Are leaders born or made? What are the characteristics of great leaders? Can you learn to become a better leader? These are all versions of the same question and a natural one to ask. Deep down inside we might just want to know if we have the capability to lead.

The phrase “we are all leaders” is true. Yet it does not get at the answer to what most people are attempting to ask, which is, “Do I have the stuff that leads to greatness as a leader?” Yes you do and here is what you need to know to tap it: Leadership is not an anointment, appointment or an otherwise granted ability; it is earned through the use of the gifts you were given at birth. Is it born? Yes. Is it made? Absolutely.

A few rare souls come into this world with clarity about their natural gifts and how they are to be utilized for good. Most of the rest of us get to figure it out and that is where leadership is made. Back to the question from the participant in the strengths workshop: “Are certain strengths or characteristics common in leaders?”

This is the question that Dr. Donald O. Clifton and the researchers at Gallup sought to answer as they began their research starting in the 1960’s (to read more about the research and outcomes, check out the book Strengths Based Leadership by Tom Rath and Barry Conchie).

Through interviews, Dr. Clifton and his team quizzed leaders across industries and occupations including political leaders. One might think after all this research the scientists would identify one strength, a single characteristic that all the best leaders have in common. That was not the case.

“A leader needs to know his strengths as a carpenter knows his tools, or as a physician knows the instruments at her disposal,” Dr. Clifton found. “What great leaders have in common is that each truly knows his or her strengths—and can call on the right strength at the right time. This explains why there is no definitive list of characteristics that describes all leaders.”

The answer to the question you are asking “Do I have what it takes to be a leader?” is yes. Will you become a leader is the question you need to answer.

Barbara StewartBarbara Stewart
Coach to financial advisers
Owner and founder
Accelus Partners
Houston, Texas