5 Mistakes Advisory Teams Make (and What You Can Do About Them)
Managing a team is an important part of an advisor's growing practice. As an individual advisor's practice becomes more successful and complex, eventually a team structure becomes necessary.
"With every additional team member, the challenge of managing complexity and achieving efficiency grows exponentially," said Kenneth Haman, managing director of The Advisor Institute of AllianceBernstein, during a presentation at the Schwab Impact 2012 conference in Chicago.
Here are 5 common mistakes advisors face as their firms grow, as well as tips on how to avoid them.
Source: Kenneth Haman, managing director of The Advisor Institute of AllianceBernstein
The successful individual performer tends to gather other individual performers together to help get things done, but this a disaster for the team. These performers expect others to see the world like they do, and as a result seek team harmony by hiring matching or complimentary personalities. Don't do this!
Effective leaders accept that planning and managing must be a priority and remain a constant commitment. They create harmony by developing successful methods and rewarding team members.
Effective leaders understand that harmony doesn't create success, success creates harmony. To create an effective and harmonious team, leaders must develop, define and refine effective methods and then hire people to implement them. ,br>
The most important question is not, "Do we naturally get along?" Instead, effective team leaders ask, "Do we all know exactly what to do in order to succeed?"
While the individual performer wants to "get things done," the team leader wants to "build an effective business."
Effective team leaders must make time for managing the team. To avoid breakdowns, they must devise a business plan, define each team member's role, and establish a communication that clarifies assumptions and perceptions of fairness. They must also develop metrics to manage performance and institute an accountability process to hold each member to their defined role.
Intention doesn't equal execution. Each member must know exactly what is expected of him and how to perform in each situation and he must be able to tell that other members are contributing. One person, the manager, must be responsible for providing the voice of the team's plan, insuring that the intention of the business is realized, and monitoring and reporting on performance.
"If you can't measure it, you can't manage it," said Tom Peters, author of the seminal business management book, In Search of Excellence.
The process of defining, assigning, and tracking metrics is the only way to measure and monitor fairness between team members. Avoid using trailing indicators which only look back, but instead incorporate metrics that also measure success for the next week.
Managing a team is an important part of an advisor’s growing practice. As an individual advisor’s practice becomes more successful and complex, eventually a team structure becomes necessary.