Whether you are building, joining, or looking to improve your financial advisory team, the goal should be to create something that adds up to more than the sum of its parts. Our Practice Management Team outlines six considerations that are critical to establishing a healthy team dynamic.    

If you are thinking of starting or joining a team, the first thing you should do is lie down until that feeling goes away.

That advice from a former senior executive has stuck with me for almost nearly two decades. In all my time coaching and consulting financial advisory teams, I have worked with many team members who are struggling and asking themselves, “Why did I agree to this in the first place?”  

Candidly, teams are not for everyone – they require sacrifice, humility and patience. Furthermore, managers on teams have to develop and deploy new skill sets, often beyond what they have trained for or performed over the course of their careers.   

That said, while anyone thinking of joining or forming a team should indeed weigh the potential consequences of their actions, it’s worth noting that the demand for teams in the financial services industry has steadily increased over the past 20 years.  

There are a number of reasons for this growing preference for a team approach. Today’s clients expect more from their financial professional, while the regulatory and industry requirements for providing services has become more complex. Given the greater demands on their time, many financial professionals have found that the only way they’re able to go on vacation or spend time with their family is to have a team they can rely on to provide adequate coverage. Furthermore, many financial professionals view expanding their practice as a crucial step to growing the business and paving the way for a comfortable retirement.  

So, there’s the rub. Teams are the model for the modern financial advisory practice, but many of those seeking a team arrangement are, through no fault of their own, ill-prepared for what lies ahead.   

 The good news is, if you think a team arrangement may be right for you, there are steps you can take to prepare. Following are six things to consider before embarking on your team journey:  

1. Be clear about WHY you are doing this. 

First and foremost, ask yourself what you hope to accomplish with a team that you couldn’t achieve on your own. Start by making a list of the specific tasks you would maintain responsibility for, then make a second list of the tasks you would delegate to team members. Be sure to consider how the allocation of each of these tasks could not only create greater efficiency for your practice, but also lead to better results for your clients. 

2. Do some introspection, then ask for feedback. 

We often think we know ourselves better than anyone, but being on a team means being open to other people’s perspectives. As with any relationship, communication and trust are both critical to a successful advisory team dynamic. Consider using tools like personality assessment instruments and informal team gatherings to build self and shared awareness of your strengths and weaknesses. Use the insight you gain from these exercises to plot a course for the future that captures the shared vision and goals of the entire team. 

3. Establish, cultivate and model the culture. 

As the leader of a team, people will look to you for what is acceptable and what is not. It’s not enough to have a list of words that express your team values; exceptional teams take time to define what those words mean in the context of working together. For example, if “honesty” is a core value at your firm, consider what that really means. For example, is it challenging your manager acceptable? Can it be done in private rather than publicly – or not at all? Values and culture are only meaningful when the leaders and executives who establish them consistently emulate them. In other words, be prepared to talk the talk and walk the walk.  

4. Don’t be cheap. 

One of the biggest mistakes I see teams make is failing to make key hires as they grow. Understaffing in key positions can create bottlenecks and negatively impact client service. A smaller, entrepreneurial business may be able to get by with more fluid roles and responsibilities, but as it grows and serves more clients, the value of having professionals in key positions becomes evident.  Whether it’s hiring another support person, expanding the research or investment team, or even bringing on another advisor, teams that can invest in human capital will be poised to grow with less difficulty than those that wait until the difficulty becomes disruptive.  

5. Establish metrics for success. 

While financial professionals are often great at keeping track of their assets under management, revenue, net new assets and number of households served, there are many additional metrics that can be tracked and analyzed to improve results. Think about the actions you want people to take or the precursors to success in your business – things like the number of proactive calls to clients or meetings needed to bring in a new prospect. As business guru Peter Drucker famously said, “What gets measured gets done.”  

6. Manage your time wisely. 

Between markets, clients, regulators and life in general, there are a lot of off-ramps that can derail you from even your most carefully planned intentions and goals. And on a team, there will likely be multiple viewpoints, ideas and interests that further complicate the answer to the question, “Where is my time best spent?” Take advantage of tools and technology – such as calendar and time audits, prioritization matrices and project management software – that can help you create guardrails and stay on track.   

Whether you are building, joining or looking to improve your team, remember that the goal should not be to create 1+1 = 2 but rather something that adds up to more than the sum of its parts. This requires sacrifices, deliberate action and the development of the people you have decided to partner with. The team dynamic is not for everyone, but with the right preparation, it can be for anyone.  

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