The third leg of the stool - FP Advance

The third leg of the stool

BY brett

The Third Leg Of The Stool - FP Advance

Great advisers attract more clients…and more clients…and more clients.

Before you know it, you’re facing a bunch of business management issues you didn’t sign up for at the start of your career. You hit a ceiling and get stuck.

The solution?

Business owners try all sorts of things to get their business moving again, using the skills they deployed in the startup and early phases of their career. For example:

  • Working harder
  • Working longer hours
  • Hiring support staff
  • Hiring more advisers

And while each of these strategies delivers some short-term relief, it never deals with the real issue. The skills that got you started have now become the handbrake that prevents you from moving on to the next level.

So, what’s the real issue?

A Two-Legged Stool Is Not Very Stable

A good advisory business is a three-legged stool, consisting of:

  1. Technical knowledge
  2. Selling and communication skills
  3. Business management skills

The first two legs are important and get focused on relentlessly in the training programmes advisers are put through.

Three legged stool - FP Advance

The third leg, business management, rarely gets taught in the traditional advisory career.

As a result, the owners of advice businesses keep turning to the strategies I outlined above, in an attempt to wrestle back control and to bring back the fun of their early years in business.

It doesn’t work.

The skills that get you started are not the skills you need to continue growing and building a sustainable business organisation that’s enjoyable to work in.

Being Head Cook and Bottle Washer is no longer a winning strategy. Unless you learn new skill sets you’ll become frustrated.

There’s A Better Way

You can only start where you are at, and any business, at any level, has something it can work on right now.

It doesn’t matter if you’re trying to create a small, beautifully-formed lifestyle business or a larger enterprise – the issues are the same. In fact, lifestyle businesses need to be more organised, or there’s no lifestyle to be had!

Owners need to address six key issues to create a business that works and to lay the foundations for future growth:

  1. Business management:
    Creating a vision for the future and being able to execute it.
  2. Team building: 
    Creating a high-performing team who are experts in their specialist roles.
  3. Process: 
    Building a repeatable client experience and a trusted brand.
  4. Culture (Values):
    To bind your team, your clients, and the business together.
  5. Client profile:
    Defining who you love to serve and working relentlessly to attract more of your ideal clients.
  6. Financials:
    Understanding your profitability ratios, productivity ratios and client selection ratios, which provide feedback throughout the business journey.

When business owners can get these half-dozen issues right, they create a business that works from the inside out.

It’s A Journey

Verne Harnish, author of Scaling Up, says “To get to 10 employees, founders must delegate activities in which they are weak. To get to 50 employees, they have to delegate functions in which they are strong!”

The first phase of growth is recognising your strengths and hiring a support team (in-house, or outsourced) to handle the other parts of your job.

Write down the parts of your job that “only you can do.”

For most adviser owners, that’s a pretty short list consisting of:

  1. Seeing clients
  2. Rainmaking activity (finding more clients to see)

Everything else you touch or get involved in during the course of your day could be delegated, if you had the right person in place to delegate to.

Administration work, paraplanning work, office management, HR, improving processes, technology; it can all be delegated

Now you’re free to do what you love and are good at.

Then What?

The next phase of growth is to create leaders throughout your organisation, so you can let go of business functions and stay focused on strategy and culture.

To do this, please, please let your team make mistakes.

How good were you 10 years ago?

Not as good as you are today is the answer you’re looking for.

How did you learn what you know now?

Through making an endless series of mistakes; mostly small, sometimes big.

That’s how your team learns too. Please let them fail, and then support them and help them unpick the learning opportunity within each failure. Trust good people to figure it out with your help and mentorship.

Business owners struggle with the transition from being the most skilled and important person in the business, into a role mentoring and developing younger team members who are ready to take over the business when they sell or retire.

But it’s the most important transition you’ll ever make.

Let people make mistakes while you are still in the building. I don’t mean business-ending catastrophic mistakes. I mean the garden variety mistakes you’ve made and learned from your whole career (just like everyone else).

If you can get your head around the switch from ‘player’ to ‘coach’, it might just be the defining phase of your business career.

It’s all good.

And let me say it in black and white: This is not a demotion. Creating the next generation of leaders is the pinnacle of great personal leadership

To Sum Up

The skills that got you here, won’t take you where you want to go.

Your business won’t grow faster than you do as a person.

Recognise that to build a great organisation and leave a legacy you’ll need to be great at business management, the third leg of the stool.

Being Head Cook and Bottle Washer is no longer a winning strategy.

Take a sneaky peek behind the scenes

The big concern that comes up with almost all the advisers I speak to is that “This is it.”

“I’ve gone as far as I’m going.”

My response?

You haven’t come this far to only come this far.

You’ve got options.

You can stay in a holding pattern at your latest plateau of performance and feel ever so slightly frustrated, or you can work with me in my Uncover Your Business Potential Online community. 

It’s simple, easy to access 24/7, and you get my brain on your business. 

Let me take you on a guided behind-the-scenes video tour and give you a sneak peek of what you’ll find once you become a member.

I’m not up for wasting time, either yours or mine. Nor am I one of those waffly-types who uses a hundred words when one will do.  If you’re like me and just want quality, to-the-point content delivered straight to your inbox, then subscribe to my weekly blog.  No frills, no fanfare, no fuss.  Just 100% solid, no-nonsense advice on growing the best Financial Planning business. You can unsubscribe at any time, we won’t be offended, although I don’t think you’ll want to.

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ABOUT BRETT DAVIDSON When you work with FP Advance you work with me, Brett Davidson, directly. My motto is ‘advise better, live better’ and I practice what I preach. I’m straight talking and get to the heart of an issue quickly. There’s no beating about the bush, just a focus on helping things improve. Ask my clients – what I teach works.