Not everybody has read my white paper on the future of the planning profession, but if you had, you'd find what I don't think is a very bold or courageous prediction.  I suggest that, for a variety of reasons, a lot of solo advisory practices are going to start looking for ways to add scale. 

In fact, the trend is visibly well-underway. With scale, advisory firms amortize their compliance/regulatory costs over a larger revenue base.  They make themselves a more attractive acquisition candidate.  As they grow, they are more likely to survive their founders, and continue to take care of clients when the founders retire. 

Not to be too greedy about it, but there's also the matter of getting paid what you're worth.  The owners of larger advisory firms, even if they move from full ownership of a small RIA to part-ownership of a larger one, generally make more money for their time and effort.

An easy decision, right?  Well, chances are you know all-too-well the downside: the huge risk of hiring new employees, and creating new expenses without any guarantee that you'll take in more revenues.  You have to train the new hires, which distracts you from your core functions.  You take on management chores that you're not trained to do. 

Isn't there an easier way?

Maybe.  Instead of bringing on new employees, you could hire an outsource firm to take on some of the chores around the office.  In today's market, this outsource ecology may be the biggest untapped resource in the profession. 

Consider: For less than the cost of an employee, you can hire a company that has more focused expertise in downloading and reconciling your performance data than you would find in a whole division of that big firm down the street.  You can hire a virtual receptionist, a virtual assistant, or a virtual compliance officer who will know more about the paperwork and responsibilities than your Chief Compliance Officer. 

You can hire a firm that knows more than you do about the financial planning program you use in your office, to input data whenever you land a new client.  There are even firms that will take over as your chief operating officer, allowing you to evade a lot of those training and oversight responsibilities as you ramp up with new employees or bring on a new software program.

But...  You run into the same problem: how do you evaluate these outsource providers?  How do you even FIND them?  Most of them are smaller companies about the size of the back office of a larger advisory firm, and some are individuals with a support staff.  They don't advertise in any of the magazines.  They don't have booths at your local or national conferences.

So the question that I'd like you to help me with, on the Financial Planning discussion forum, is: what's the best way to interview, evaluate and start a relationship with an outsource provider?  How do you know a good one when you see it? 

If you DO work with an outsource firm, are you happy with their work?  Who do you recommend? 

If you DON'T currently outsource, but you'd like to add scale, painlessly, to your firm, what chore would you like to take off your desk?  Mention that in the online discussion forum, and let others tell you who to talk to.

To enter this discussion, click below. I hope at least some of you will think that I'm completely off-base and will be courageous enough to say so; those are the comments I tend to learn the most from.

If you have suggestions about other topics that the profession ought to be exploring, or great ideas for a group discussion, please send me a message at:

Bob Veres is one of the leading journalists in the financial services world.  For much more information on practice management, investments and marketing, go to:


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