blocks with icons / andrii yalansky

This article appears in the May 2023 issue of Investment Executive. Subscribe to the print edition, read the digital edition or read the articles online.

“Coach’s Forum” is a place to ask your questions, tell your stories or give your opinions on any aspect of practice management. Our objective is to build a community with a common interest in making financial advisory practices as effective as possible.


I have a sizable practice with a major dealer firm, which I am told is the envy of the large office in which I work. We are a discretionary management shop with documented workflow systems. Most of my team has been with me for at least five years. They handle everything — administration, client service, number crunching for financial and investment plans, preparing review meetings, portfolio transactions — leaving me to focus on big-picture items and relationships with our top clients.

What gnaws at me, however, is that my book of business hasn’t grown over the past few years. I know Covid had some impact, but the new clients and assets we add just replace what we lose through client drawdowns or deaths, transfers to adult children and market declines.

When I complain about our lack of growth to my team, they tell me adding any significant number of new clients would require hiring more staff.

Maybe I have gotten too far from the day-to-day operations, but I wonder if we have become too comfortable with where we are. Any ideas on how to shake things up?


First, congratulations on your success to date in building a sustainable business. The majority of financial advisors in the industry today have successful practices, while only a subset have elevated themselves to “sustainable business” status.

What’s the difference? While both can be highly profitable, the risk is much greater in a successful practice because its success often depends on the founding advisor — their knowledge, network, work ethic, reputation and personality. A sustainable business, on the other hand, is much bigger than the founding advisor, and not necessarily in terms of the number of people. I mean the business has reputation and goodwill of its own, over and above that of the advisor alone.

By your description, you have built a sustainable business, and this will serve you well when you decide it’s time to exit. However, given that you still want to grow your business, I assume retirement is some way off for you, so let’s consider how to re-energize your practice now.

First, recognize that all enduring businesses grow in cycles. They start off slowly, growing until they reach a “ceiling of complexity,” at which point momentum begins to slow and the business begins to plateau. At this point, a business could begin declining unless something is done to reinvent it. That change sparks a new growth cycle.

This sequence is what prompted you to hire your first assistant, to develop the systems you now have in place, to expand your team and to add discretionary portfolio management. Each time you changed something in your practice, new opportunities opened for you to move to the next level.

The problem may be that your team doesn’t want to upset the status quo because everything runs smoothly and easily. If that’s true, rather than a ceiling of complexity, you may have reached a ceiling of complacency. Since you think your team may be at the heart of the issue, let’s begin by evaluating your organization chart.

Step 1: Identify your core business functions

Think about the type of business you have and the manner in which you operate. Then, list the all the primary and secondary functions that must be consistently carried out to deliver everything you promise.

At the highest level, those include strategy, marketing, sales, advice and operations.

Each of those functions has one or more secondary functions. For example, “operations” may be divided into administration and client service; “advice” might be split between planning and portfolio management.

Step 2: Create an org chart based on functions, not people

Draw a new org chart based on the functions you identified.

Typically, when advisors draw an org chart of their practice, they do so based on existing team members, not the functions. But that method may not reflect the best structure for the practice you envision.

Drawing your org chart based on functions also helps with legacy staffing issues. Many advisors hire their first staff members from among family, friends and former co-workers because they provide a level of trust and familiarity. As a consequence, while you know you should probably have someone more capable in a position than “dear old Sally,” you might say something like “Sally has been with me from Day One”; “The business may have outgrown Sally, but she knows more about X than I do”; or “She’s my sister; how am I going to fire her?”

By drawing your org chart based on functions rather than people, you avoid these potential obstacles.

Step 3: Define each function and its required qualifications

After you’ve outlined the functional areas and reporting hierarchy for your business, create a role description for each function that incudes job requirements and qualifications. List duties, responsibilities, experience, credentials, aptitudes, attitudes and other necessities.

Step 4: Evaluate existing staff against required qualifications

Now, knowing what has to be done and what it takes to qualify to do the job, look at your existing team and see who fits where. And keep in mind: the evaluation includes you!

Put the names of your entire team into the appropriate boxes on your new org chart — but only in the functions for which they are fully qualified. Be ruthless in your assessment of people’s qualifications. There are ways to improve a team member’s suitability if they don’t currently fit but, for the purposes of this drill, do not put a team member’s name in any box if that person is not fully qualified.

A few things will become evident:

  1. some people will have their names in more than one box (almost always, one of them will be you)
  2. some boxes will not have any names in them
  3. some people won’t have their names in any boxes

If a team member is qualified for more than one function, ask, “Which is the best use of this person’s talent, given the time the function takes, its importance to the practice and considering everything else the team member could be doing to further the business?”

Where you have boxes without names, ask yourself: “Given that this is an essential function, can any of our existing team members become qualified through training or motivation to perform these duties well?” If the answer is yes, attach that person’s name to the box (but not inside it, to indicate something is required to make the person fully qualified). If the answer is no, ask: “Is this a position for which we can hire or outsource?”

Finally, what about an existing team member who doesn’t fit in any box? Again, ask, “Can this team member become qualified for a function through training or motivation?” If the answer is yes, consider how that will be accomplished and the time that will be required. Then, decide how that job will get done in the interim. If the answer is no, make a decision to retire or terminate that team member, or live with that person’s underperformance for your own reasons.

Everyone in your practice working at the peak level of their capabilities would be rare, much less all functions being performed to the highest standards. And most employees know that. This review of everyone’s role on your team puts them on notice and may be just what you need to begin shaking things up.

This exercise won’t solve all your problems, but the process is a good first step toward identifying and addressing areas in your practice that need strengthening. Next time, we’ll examine more ways to shake up your practice.