Excel to Exist

[Mitch]

What does it take to grow a successful financial advisory practice?
It seems that each time I speak with an advisor, the subject always
seems to gravitate towards what advisors are doing to achieve
financial success. I can’t tell you strongly enough that any
financially successful advisor has found his/her unique way to provide
a unique service; there is no secret formula. It really bothers me to
see advisors who have had some financially rewarding experiences that
try to present a “Secret Formula” as the reason for their success.
Your relationship with your clients should be a personal one if you
ever expect to earn their trust. With this in mind, if you are trying
to be someone else, your client will intuitively sense it and trust
will be very difficult to achieve. At the gym I workout at, the
gentleman with a locker below me is a finance professor at Cal Poly.
He and I had a conversation about the financial advisory business and
he pointed out that financial advisors tend to be very
entrepreneurial. He is right but only for a small percentage. Let’s
look at the definition offered at http://www.quickmba.com/entre/definition/
Entrepreneur originates from the French word, entreprendre, which
means ‘to undertake’ In a business context, it means to start a
business. The Merriam-Webster Dictionary presents the definition of an
entrepreneur as one who organizes, manages, and assumes the risks of a
business or enterprise.
Schumpeter's View of Entrepreneurship
Austrian economist Joseph Schumpeter 's definition of entrepreneurship
placed an emphasis on innovation, such as:
new products
new production methods
new markets
new forms of organization
Wealth is created when such innovation results in new demand. From
this viewpoint, one can define the function of the entrepreneur as one
of combining various input factors in an innovative manner to generate
value to the customer with the hope that this value will exceed the
cost of the input factors, thus generating superior returns that
result in the creation of wealth.
An entrepreneur embraces change and risk. He/she embraces risk for the
prospects of reward. BUT he/she is only willing to take the risk if he/
she believes that the change/innovation will be an opportunity to gain
market share and the commensurate profits.
For most advisors I have talked to, they are looking to be led but
enjoy the profits of an entrepreneur. It sounds a lot like having your
cake and eating it too!
In traditional business, entrepreneurs are people who understand their
respective industries so well that they have identified an opportunity
to create new and innovative products.
I hate to sound like a broken record but I believe that most financial
advisors do not achieve their full potential because of lack of
knowledge about their industry and craft. If an advisor truly
understands their industry, they will see opportunity. Why don’t many
advisors truly understand their industry? I believe that advisors
don’t appropriate enough time to exploration, education, and
experience.
3 Tenets of a Financial Advisor
1. A Financial Advisor should constantly be exploring industry trends.
Read through every available publication available.
2. A Financial Advisor should constantly be educating him/her self.
Take new courses or read textbooks on financial theory; preferably
academically authored.
3. A Financial Advisor should always be gaining experience. Broaden
your practice services and gain new and valuable experiences through
embracing variety. Most advisors think that streamlining their
planning services, but they only limit their potential clients.
WHY DO ALL THIS?
Competition. In order for you to grow your business, you need to take
clients from other advisors. You will only be able to this if you have
something innovative to offer; simply doing the same thing as everyone
else won’t cut it. When you compete, you either win or lose. Winners
do things that losers don’t. Winners work with a focus in winning and
losers participate without defining their goals. Believe it or not,
every other successful financial advisor is a competitor and they are
always looking to steal your clients by offering superior services.
Think about it, does a successful financial advisor works through the
process of identifying an opportunity that they exploit for profit and
your clients could next. What are you doing to keep this from
happening? If you are not doing the 3 Tenets mentioned above, you may
not be doing enough.
I know what I write through firsthand experience. I needed to Excel to
Exist. You can look at my software company and see that I remain
dedicated to innovation and excellence. The best thing is that I am
here to help YOU!