The person writing and running the business is often trying to develop it too. Understandably, there will be gaps.
Many advice firms see business growth as one of their top priorities, but turning this aspiration into reality is more difficult than it sounds. This is understandable. After all, most advisers are entrepreneurial and client-focused by nature; they are not necessarily business strategists. So for those who see business development and growth as an absolute ambition, what should they do?
The challenges facing business owners today are very different to five or 10 years ago. Advice firms tell me about increasing income pressures and challenges with recruiting and retaining talent. Also, how do you source new clients? How do you achieve greater levels of productivity?
Many firms are also concerned about whether they are keeping pace with the latest technological developments, along with managing their exposure to ever-increasing cyber risks. Meanwhile, we have a regulatory environment that is constantly becoming more challenging and demanding.
The upshot of all this is a fundamental desire from firms to operate more efficiently, as the combination of a squeeze on their business from regulation and increasingly demanding clients impacts on the bottom line.
Going hand-in-hand with greater efficiency is the need to leverage their value, which for some will probably entail scaling up their business and for others might mean considering the likes of mergers and acquisitions – perhaps even preparing for a future sale.
Before diving into solution mode, it is important to establish the fundamentals. Leadership, organisational structure and management style are all key to future success.
For some firms, this is going to pose quite a challenge, because a lot of the time, the person writing and running the business is also trying to develop the business.
The question, therefore, is how effective that person is at all three of these disciplines.
The chances are there will be some gaps, so something like a leadership development programme that incorporates best practice across a range of areas could be a good starting point.This could cover strategic thinking and embracing change, succession planning and leading people, or growth, diversification and exit strategies.
At a recent roundtable debate with leading advice firms, four key areas emerged as those advisers are most looking to prioritise. Sharing this list might help others as they consider and clarify their thinking around business objectives and solutions:
- Develop a growth strategy that maximises your value. With so much change taking place across the industry, it is imperative you make the right decisions moving forward and back the right horse;
- Focus on people development because with an increasing skills shortage in the market, there is a risk that not developing your people or creating opportunities could lead to succession and retention issues;
- Improve your go-to-market proposition, particularly in terms of your digital presence;
- Streamline your proposition, so that when you sit down with clients, you can spend more time talking about the value you bring rather than weighing up the pros and cons of every platform and investment solution out there. Try to switch the axis and get more clarity on your proposition, so it drives more value.
Every advice firm is different, which is why there is no one-size-fits-all solution.
Perhaps this is no surprise given that every client is also different and has their own individual needs and circumstances.
That said, there are fundamental skills advisers can develop in order to improve their chances of long-term success. Strong leadership and an efficient organisational structure are critical, which is why effective business development support could be one of the wisest investments a firm makes.
Ross Liston is managing director of Bankhall and PMS