Since its launch in 2011, over 600 advisors have participated in the program, with a goal of reaching 750 advisors by year-end 2012. The enlarged version now includes these four topics: strategic planning, managing profitability, technology integration, and succession planning.
"Last year's introduction was a bit of an experiment," Nick Georgis, vice president of Schwab Advisor Services, told Financial Planning. "We wanted to see if advisors would commit the time to such an immersive program. As it turned out, we received rave reviews. Advisors - and that includes some who manage over a billion dollars - made comments such as, 'this was a game-changer.'"
According to Georgis, each topic is offered as a three-stage-course. First, participants are given a program guide on the relevant topic. "We want everyone to start at the same place," he said.
This leads to a one-day onsite workshop, typically attended by about 30 advisors. "Around seven advisors are at each tabletop, so everyone has a chance to have a say," he said. "We encourage a lot of give-and-take at these meetings."
Workshops on such topics are not unknown but Georgis says that post-workshop follow-up make Schwab's program unique. "The total commitment is often about three months," he said. "Advisors have a series of one-on-one sessions with Schwab consultants to help encourage the advisors to implement the desired changes."
As a group, advisors are known for spending a lot of time working with their clients and not enough time on their own practice management. "We estimate that advisors who participate in our program spend four to five hours a week, after the workshop, following up on what they've learned," Georgis said. "Advisors have told us that they really like Schwab consultants 'holding us to task' so that things get done."
Results so far include the development of strategic plans.
"These are custom plans," Georgis said. "We provide the framework but the advisors actually write the plan for their own business. We've also seen advisors develop a formal segmentation of their client base, by profitability. Our software can help advisors determine how much time they spend on individual clients and determine the cost." This calculation, in turn, can help advisors price their services more efficiently.
Schwab's development of its Insight to Action program has been aided by the firm's annual RIA Benchmarking Study, which captures trends and best practices in the RIA industry, based on data from participating firms.
According to the study, "best-managed firms" (those in the top 20% based on profitability, productivity and growth) have seen double the revenue growth rate and margin and almost fifty percent higher revenue per professional than all other firms in the study. Actionable insights taken from working with the best-managed firms helped shape Insight to Action's course curriculum.
Donald Jay Korn writes for Financial Planning.