Are You Ready to Lead a Practice?

Many advisors venture out on their own in order to grow a vibrant book of business. As the client roster grows, the need to bring on more help to manage clients also grows. But the skills that make you a great financial advisor do not make you a great practice leader. To effectively transition from the role of financial advisor to financial advisor practice leader, you need to develop several key skills.

CEO Mindset

As you begin onboarding new team members, your focus should naturally shift from handling the day-to-day needs of your clients to running and building your practice at a strategic level. Making the shift from advisor to CEO means learning how to delegate and distribute tasks to the team and how to keep your time and energy focused on defining the path of the organization, setting goals, and leading the practice toward those goals. You also need to learn how to make very difficult and strategic decisions that will strengthen the organization and help it grow through an ever evolving and, at times, tumultuous economic climate.

Systems Thinking

In a team practice, operational performance becomes a major focus of the practice leader’s time and energy. To efficiently scale a financial advisor practice, you need reliable, flexible systems that can support every aspect of operations and that can grow as the practice grows. As the practice leader you need to learn to identify and source financial services technology, develop processes and procedures for key operations, create compensation structures, and establish, train, and maintain standards for delivering client services.

Brand and Culture Management

Transitioning from a solo advisor to a team-based practice means establishing a clear brand and practice culture that attracts and retains talent and clients. A brand and culture extend beyond the personality of the founder. They are based in clearly defined values, a powerful mission, and in the norms and behaviors that are developed and reinforced by the entire team. As the leader you need to know how to define the brand and culture, how to communicate the elements of that brand to clients and staff, and be able to define and reinforce expectations so the organization can live up to the desired culture.

Financial Management

As you evolve from solo advisor to practice leader, you must become more adept at managing the financials of the practice, not just client portfolios. You must become knowledgeable in the factors that drive practice value and profitability and know how to manage and influence those factors. This means knowing how to read financial statements, understanding how client composition impacts practice revenue, securing business valuations, and managing practice expenses in order to maintain profitability.

As the old saying goes, what got you here won’t get you there. Your practice will evolve over time and go through many phases of practice development, which will require you to evolve and change as well. In order to manage and grow an effective practice, you need to develop new skills that will help you become a leader, not just a skilled financial advisor.

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