Maybe you're at the top of your game; growing revenues and profits, recruiting top tier talent, and expanding your book of clients with quality referrals. Or perhaps you've hit a wall and, while revenues are good, you're on a plateau and just maintaining the status quo for the most part. More than likely, you're somewhere in between.

Wherever you are on the spectrum, even the best independent financial advisors can benefit from an occasional or even regular program of coaching and mentoring. (After all, even gold medal athletes take lessons.) It sometimes takes an outsider with a fresh perspective to see the best way for you to take your team and your practice to the next level. Coaching, mentoring and similar peer-network methods are increasingly being used to enhance professional development, embed positive practice changes and encourage the sharing of advanced skill-sets and learning. We have found that this is time very well spent.

For the very best advisors we work with the mindset that self-improvement is not an option ? it is almost an obsession. From good to great may be something of a cliché, but the reality is to be great requires continuous learning. It's what we call being committed to one's ongoing professional development not training, because as Churchill said "I'm always ready to learn. I'm not always ready to be taught."

Professional coaching and mentoring is not about teaching, but rather helping teams identify what it is they do well and where there are deficiencies. Not to get "new age", but part of mentoring is a guided self-discovery that helps advisors and teams reach conclusions on their own by asking questions. Sometimes a small tweak can have extensive results.

As an example, a few months back we were doing a business review with one of the teams in the Dynasty network.  When reviewing the advisor's P&L, we noticed that his top wealth management clients where he was performing comprehensive services (financial planning, trust review, insurance, lending, asset management, etc.) had the same fee schedules as business clients who hired his firm for asset management services alone. As a result, his profit margin for wealth management clients was lower as he was doing far more work for them. The solution we arrived at together was to design service level agreements that define the services performed by his team allowing clients to make decisions between becoming an asset management client or a wealth management client.  Wealth management clients pay more because they get more.  We helped the team draft up the new agreements, build marketing pieces that describe the new service level agreements and did basic role play with advisors to make sure they were comfortable with client positioning.  So far it's working great for legacy clients and new clients.  This is just one example of a simple suggestion making a meaningful impact on work-loads and firm profitability.

Part of the mission of any formal or informal coaching and mentoring program is to provide a forum for the open exchange of ideas related to a range of relevant topics, from investment management to practice management and building your client and asset base.

Finding out exactly what it is you need is part of a discovery process. For example, at Dynasty Financial Partners, our goal is to enhance skill sets and shorten the learning curve to doing better business at every stage. To do that we execute discovery on independent advisor teams through extensive interviews and a due diligence process that takes into account resources, marketing, referrals and business practices. This can involve multiple people as often times mentorship by committee allows for broader and more comprehensive feedback.  When doing this work yourself, don't be afraid to include peers, co-workers, coaches, resource partners, etc. on this committee.  Also don't rush through the initial discovery process as it is absolutely critical to delivering results during the coaching process.  

Since the relationship between financial advisors and their clients is completely individualized, it is impossible to provide effective coaching unless an in-depth knowledge of the ideal service model is obtained.  Once the coach(s) understands variables such as
the skill set of the advisor, infrastructure of the team, client
deliverables, etc., they must evaluate how close the team is to achieving their ideal model.  Feedback must be direct.  For some, the advisors need to make a few changes to optimize business.  For others, a completely new model must be created.  Getting and receiving honest and direct feedback is critical the process.  We recommend and help our advisors set up client advisory boards and have found that if you select that right clients they will give you very candid feedback, and they like being involved with making their advisory firm better.

As our advisors growth partners, our objective often times is to help teams do more business more efficiently by maximizing their true potential; helping advisors stay focused and take action on the highest payoff activities that lead to business, professional and personal success. This often circles back to client assets ? identifying, uncovering and assessing ways to bring them in, as well as connecting on a deeper level with clients, potential clients and referral sources. Of course, leading independent advisors have effective tactics for building assets, but mentoring and coaching can help them employ additional levers they may not generally use: marketing, managed money, asset consolidation and allocation and even qualifying better leads.

A short list of things we have found that can be helpful outcomes to coaching and mentoring sessions with advisors:

?     Set a value proposition that makes a practice unique and provides business focus.
?     Define a growth plan: identifying steps to develop predictable and recurring revenue streams.
?     Structure a replicable process for the acquisition of assets ?
top teams have solid compound annual growth rate (CAGR) and a system to bring in assets.
?     Help newly independent teams develop a 100-day plan to ensure a practice is on track in terms of handling clients and developing new business.
?     Develop effective P&L management discipline for expense control; Encourage teams to learn small business skills from business-owner clients.
?     Enhance client segmentation and filtering techniques that are key to keeping a book sized manageably and focused for growth.
?     Create a tiered system of client contact ? e.g.,
platinum/gold/silver levels that help determine where to spend the most time and focus the most effort.
?     Develop an effective referral program that makes it easy for
clients and contacts; Attracting professionals like lawyers and CPAs to demonstrate capabilities and cross-share clients.
?     Incorporate an effective, manageable product range that will help increase share of wallet ? insurance, lending, trusts, etc.
?     Define wealth management offering and manage client/team expectations.
?     Coach and develop staff and incorporate a growth track that will help attract, retain and reward excellent employees including delineating specific roles for staff members.
?     Expand a practice by folding in new teams and taking on
additional advisors to create growth and share expenses.

Through coaching and mentoring, Dynasty ensures the effective development and evolution of independent advisor practices so they maintain their competitive edge. Staying the course is fine when you're actually on course, but everyone can use an adjustment now and then.  As independent RIAs sometimes you can also feel more isolated and it may feel more challenging to get this coaching and mentoring work done. Whatever your circumstances however, we encourage you to not let good be the enemy of great and proactively put in place a mentoring and coaching program for yourself and your business partners. It is an important tool to ensure independent advisor teams and their businesses are headed in the right direction.


Shirl Penney founded Dynasty Financial Partners and is its president and CEO. He is formerly director of business development for global wealth advisory services at Citi Smith Barney and previously was head of executive financial services and director of private wealth management at Smith Barney.


Register or login for access to this item and much more

All Financial Planning content is archived after seven days.

Community members receive:
  • All recent and archived articles
  • Conference offers and updates
  • A full menu of enewsletter options
  • Web seminars, white papers, ebooks

Don't have an account? Register for Free Unlimited Access