Five essential steps to help grow your practice
Growth-minded advisors are typically bold, work hard to win new clients, and have a vision. But without a plan, reality can sometimes fall short of the vision. Firms that develop a sustainable growth strategy can maximize their growth today and set a path for building momentum into the future.
Follow these five steps to help you establish a plan for growth that's right for your firm.
1. Define who you are
Advisors typically choose the RIA model with a clear sense of purpose. You want to do right by your clients and build a practice that you can be proud of.
Develop a plan that puts who you are and what you stand for at its center. Use these values as your guide as you develop your strategy and don't lose sight of your north star. If something doesn't feel right or isn't true to you, consider a different approach.
2. Assess your situation
Critical to a growth plan is a clear understanding of where your firm currently stands and how it's poised to achieve the goals you set. Evaluating your situation using the "SWOT" analysis (Strengths, Weaknesses, Opportunities and Threats) can help you get you there:
- Internal – Identify the strengths and weaknesses within your firm
- External – Determine the factors outside the firm that pose either opportunities or threats
Taking time for this process will allow you to evaluate where your firm excels and identify the gaps in expertise or competence you may need to fill. It also can help you uncover opportunities for growth and prepare for barriers to success you may encounter.
3. Identify your ideal client
A big challenge facing many firms is determining whether a prospective client is the right fit. Growth-minded firms can be tempted to take on every prospect who walks through the door, especially if they have significant assets. But are they a good match?
To find your ideal client—a client who you want to attract and for whom your firm does its best work—think about a potential relationship holistically, beyond the assets to be managed. Ask yourself:
- Can our firm offer solutions to meet the client's particular and unique needs?
- Are we prepared to address the stage of life they are in as they prepare for their future?
- What is their investing proficiency?
- Does the client fully understand and value our approach?
- If they have an investment philosophy of their own, will it conflict with our firm's approach?
- Are they comfortable delegating, or will they want some level of involvement in the process?
- Is there a personality fit--will we work well together?
- Are they located in a region where we're able to serve them?
Running through this checklist can help you feel confident that a prospective client will likely be a good fit for you and your firm.
4. Set goals
Goals help you make sure your plan is on track and provide clues for what adjustments are needed along the way. It's helpful to have at least one long-term and several short-term goals that support your bigger objectives. For example, if you have a goal of merging with another firm, your more immediate goals might be to: increase margins, grow your number of clients, and improve back-office efficiency.
The "SMART" method can be a useful tool to guide you in establishing your goals. Regardless of type or size, each goal you set should be:
- Specific – Be clear and precise about exactly what it is you want to achieve
- Measurable – Set tangible metrics for how you will evaluate progress and measure success
- Attainable – Be sure your objectives are possible and within reach
- Relevant – Verify that your plan includes courses of action that are pertinent to your growth goals
- Time-bound – Establish a detailed timeline including start dates and target dates
5. Check in on your progress
Once your growth plan is in motion, schedule periodic check-ins to track your success. Identify what's moving along as planned and celebrate those successes. You may discover that certain aspects of the plan are encountering barriers due to unpredictable forces such as internal changes at your firm or external factors in the market. Stay nimble and re-think those aspects of your plan. Having that flexibility will help you keep your overall vision from losing steam.
Not unlike investing, sustainable growth requires careful and diligent planning. No matter how bold and ambitious your growth goals are, creating a plan can help you realize the future you envision for your firm.
What you can do next
- Register for the Virtual Practice Management "Building Your Strategic Plan" program.
- Take our Guiding Principles Assessment to find out what it'll take for your firm to stand out from the competition.
- Consider a custodian that invests in your success. If you're thinking about becoming an independent advisor, contact us to learn more about the benefits of a Schwab custodial relationship.