Three Practice Management Keys: Vision, People And Culture

Long-Term Vision, Focus On People And Value-Based Culture Foster Success That Overcomes Economic Troughs

The economic headlines are gloomy. Earnings are down. Businesses are closing at a higher rate than in recent years. Over 70% of new financial advisors leave the industry within three years. However, behind these depressing statistics, financial advisors and businesses are still thriving and finding growth opportunities.

Below, I share three principles and supporting practical tips that help strengthen advisory businesses that face inevitable economic peaks and troughs.

Take Care Of Your People

The days of people staying with the same company for their entire careers are long gone. However, low employee turnover is a critical factor in delivering consistently high-quality service and steady organic growth. Additionally, the next generation of advisors and employees are looking for different benefits than previous generations. While compensation is still a factor, other benefits that help employees lead the lives they want and develop professionally help foster an enticing workplace environment.

Staying current with compensation, benefits expectations and best practices is critical. You may consider employee surveys or have a human resources expert monitor trends and report to leadership annually. Your business can use that data to evaluate your benefits package and adjust accordingly.

Focus on employees

We believe in creating a beautiful work environment that is comfortable for on-site employees, providing regular service and volunteering opportunities, and offering competitive benefits, including financial support for employees to attend graduate school or complete certification programs like the CFA.

Foster A Positive Culture

The role of the employees in a successful business brings me to my next recommendation: Create and maintain a positive culture. Yes, this concept is fairly nebulous – but it works when you take time to identify your company values and mission and then take action to make those values part of day-to-day operations.

There are several methodologies you can apply to identify your company values. One of the common threads is to include employees outside of leadership. Whether you create a focus group or committee or run an employee survey, involving the people who execute your vision gives them a voice in what the company stands for and how to demonstrate it and can elevate buy-in.

Implementing your vision and values to develop and maintain a positive culture is tricky. For example, if gratitude is a core value for your business, implement ways to express thanks authentically from the top down and between peers. Managers can be coached on various ways to thank employees for their hard work. You can consider different peer recognition programs to encourage employees to recognize and celebrate each other instead of waiting for thanks from supervisors and managers.

Our firm has a culture unlike the traditional high-pressure atmosphere you’d expect in an investment house. Instead of focusing on short-term performance and fear, we foster a calm and measured temperament and long-term view, focusing on our clients. We recommend this, to generate a positive, supportive environment for employees and clients.

Focus On Long-Term Vision

Today, many people are looking for meteoric quick returns, but the potential for high rewards comes with higher risks. Many advisors and investment managers advocate for long-term planning but face constant challenges in the form of client expectations on short-term performance. Focusing on values and risk appetite management can help you, your clients and your business keep your eyes on the future. You can apply a value-based philosophy to your client care and investment strategies.

Take the long view

First, it’s critical to understand your clients’ values and goals to build an effective and appropriate financial plan and portfolio. By asking open-ended and thoughtful questions, you can learn about what your clients want their lives to be like now and in the future. Discover what is important to them, whether it’s retiring in luxury, supporting women-owned businesses, providing a legacy for their children, practicing generous philanthropy or something else.

In our experience, a value-based investing philosophy delivers consistent performance and protection over market cycles. We recommend a risk-averse and long-term view of investment strategies and growth plans.

One Final Piece Of Advice

Don’t be afraid to try new things. Sticking to the status quo and doing things the way they’ve always been done is easy. Change and transformation are rarely comfortable but often worth it. In our experience, a positive culture can guide a firm through changes that encourage growth and thriving while staying true to the firm’s values.

William Rice is CEO of value investing-focused Anchor Capital Advisors.

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