One of the greatest strengths of providing ongoing financial planning and investment management for an AUM fee is also the model’s greatest challenges: because the revenue is recurring, and industry retention is so high, as long as advisors can survive long enough, they can eventually accrue enough clients to build a sizable business. Thus, one of the greatest predictors of an advisor’s income, and the size of his/her business, is simply the number of years the advisor has been in practice.
However, the fact that advisory firms steadily accrue (and rarely lose) any clients means that eventually, the growth of the business will necessitate hiring. And then more hiring. And at some point, there are so many clients, and so many employees serving them, that the advisor ends up spending more and more time doing tasks in the business that aren’t enjoyable, and less and less time working with the clients he/she once enjoyed.
In a new book entitled “The Pursuit of Absolute Engagement”, industry consultant Julie Littlechild studies how financial advisors and their firms can unwittingly veer off course, and what it takes for the advisor to become re-engaged in the business again. Because the reality is that failing to do so can eventually lead to a point of burnout, where the advisor loses control of the business – and instead it feels like the business controls you!
Ultimately, the path to finding meaningful engagement with the business again is all about (re-)creating its future with a specific intent – to identify the kind of clients that you enjoy working with, the kind of work you enjoy doing for them, and the role in the business that is the most personally engaging and fulfilling for you. For most advisors, the idea of finding a focus – to the exclusion of clients and tasks that don’t fit the mold – is terrifying, both for the change it entails, and the risk to the business. But as Littlechild points out, the truth is that for many advisors, the best path forward for future growth is all about focusing in on the right clients, the right work, and the right role, that helps the advisor find “Absolute Engagement” – because when you’re truly engaged in the business, your newfound energy is likely to do more to propel the business forward than any other business strategy could have accomplished anyway!
source https://www.kitces.com/blog/absolute-engagement-book-review-julie-littlechild-avoiding-burnout/?utm_source=rss&utm_medium=rss&utm_campaign=absolute-engagement-book-review-julie-littlechild-avoiding-burnout
No comments:
Post a Comment