Advisors rightly want to know how to justify the expense of making changes in their businesses, especially if they decide to hire a coach. The benefits are addressed in this chapter, but at the end of the day, 50-plus years of experience says justification is a state of mind.
While there is some research suggesting asset and revenue growth can be attributed to working with a business coach, perhaps the biggest benefit is difficult to measure. In financial advisory practices, most FAs tend to work individually, even if part of a team. As part of a team, advisors can at times work with their partner to bounce ideas off one another. With solo-preneurs it’s difficult. There is a great benefit for advisors to share ideas with another individual to:
• See if plans make sense from another perspective.
• Find out what other advisors are doing in similar situations.
• Brainstorm new ideas and consider other options.
• Share confidentially.
In essence, when another individual is your partner you have an informed, knowledgeable teammate, an independent voice who cares as much about your business as you do. The difference between success and failure is often small. That gap can be narrowed with a business coach.
Statistically accurate metrics on the growth of assets and revenue over a significant period of time (e.g., several years or more) for multiple advisors is limited. One article said, “The Oechsli Institute claims that the average coaching client brought in over $19 million in assets over the past 12 months, added 21 new clients and increased advisory fees by nearly 22 percent.”1 It is difficult to evaluate specific benefits without knowing the situation, including the baseline in these cases. Neither of the other two firms described in the same article quoted any quantitative benefits.
In another article from 2011, Matt Oechsli’s research showed that “advisors who are consistently acquiring wealthy clients are a distinct minority, and most other advisors are eager to learn how to replicate that success.”2 He “defined ‘elite’ advisors as those who have acquired five or more new $1-million-plus clients over the past 12 months.” Only about 10 percent of FAs reach this level, with only 1.5 percent acquiring 10 or more million-dollar clients. The rest of the “elite” acquired five to nine new $1-million-plus clients while about 50 percent of FAs acquired one to four new $1 million-plus clients and 40 percent acquired none. (These FAs were not part of the Oechsli program.)
We can point to cases in our own experience where FAs have increased production by 50 percent in little more than three years while they also grew AUM by 83 percent. However, one of the reasons it is difficult to suggest an anticipated increase in growth rates is because it depends on too many variables: the advisor, the markets, the length of service of the advisor, the client base, and mostly the depth of execution the advisor puts into implementing the recommended processes. While case studies are available, they are usually one-offs and don’t represent statistically accurate assessments.
Most of the literature states benefits in the form of qualitative improvements. We have no doubt, though, that you will grow your assets, revenues, and client households, and have an excellent ROI in doing so, if you:
• Formally segment and analyze your book and clients.
• Develop a realistic and complete business plan.
• Implement the six defined processes.
• Execute several business development approaches.
• Track your actions and results.
• Clearly define and state the value you deliver.
You will also be more efficient as well as effective while being able to be more consistent in what you do and how you do it. You will have the time to implement an effective set of marketing and sales approaches for improved client acquisition efforts. You will be less overwhelmed, less stressed, and have a more manageable practice. You will maintain or improve your client retention.
Overall, implementation of the contents of this book would provide:
• More structure around what you do, when you do it, who you do it for, and how you do it.
• A focus on what is important to you.
• Ideas on what is working for others.
• An opportunity to be held accountable if you implement these processes with a capable, experienced accountability partner. On a scale of 1 to 10 (10 being high), you need a laser focus to be at a 9.5 or better. That’s where accountability comes in.
• A better understanding of your unique areas of opportunity.
• A clear roadmap of how to take your business to the “next level.”
• An increase in client loyalty.
• Deeper and more profitable relationships.
A coach who is experienced in working with FAs would be of value in the customization and implementation of these processes. Let’s look at some benefit data.
In their article “The Neuroscience of Leadership,” David Rock and Jeffrey Schwartz write:
You’ve probably had the experience of going to a training program and getting excited about new ways of thinking, only to realize later that you can’t remember what the new ways of thinking were. Were the ideas no good in the first place? Or did you just not pay enough attention? A 1997 study of 31 public-sector managers by Baruch College researchers Gerald Olivero, K. Denise Bane, and Richard E. Kopelman found that a training program alone increased productivity 28 percent, but the addition of follow-up coaching to the training increased productivity 88 percent.3
The International Coach Federation (ICF) is a well-known professional organization that has more than 60 chapters worldwide. ICF states that the benefits of using a coach include “fresh perspectives on personal challenges, enhanced decision-making skills, greater interpersonal effectiveness, and increased confidence. And, the list does not end there. Those who undertake coaching also can expect appreciable improvement in productivity, satisfaction with life and work, and the attainment of relevant goals.”4
According to the ICF, “Coaching generates learning and clarity for forward action with a commitment to measurable outcomes. The vast majority of companies (86 percent) say they at least made their investment back.” And 99 percent of companies and individuals who hire a coach are “‘Somewhat’ or ‘Very Satisfied’ with overall experience” and “96 percent would repeat the process.”5
Another site that offers coaching says that one of the “main benefits of coaching” to the recipient is that it “generates improvements in individuals’ performance/targets/goals [by] 84 percent,” and among the benefits to the organization is that coaching “allows fuller use of individual’s talents/potential [by] 79 percent.”6
Coach Bill Cole (www.mentalgamecoach.com) says:
A coach won’t do the work for you, but here is how a coach can help launch you to the next level:
1. A coach can be a confidant. You can tell your coach things you wouldn’t tell others, because a coach is trained to understand and be nonjudgmental.
2. A coach can help you see your blind spots. Everyone, even the coach, has personal areas that are out of view or awareness until someone points them out. A coach is perfectly poised to perform this critical function.
3. A coach can provide objective feedback. Other people may have agendas. Your coach has your best interests in mind in providing feedback and counsel to you.
4. A coach provides another set of eyes. Even the top performers in the world have coaches to help them see what they themselves can’t see.
5. A coach can keep you accountable. Your coach can help you take on more responsibility by having you report weekly (or biweekly) on your accomplishments and initiatives.
6. A coach can be a sounding board. Your coach can be another set of ears as you talk about the things that are bothering you. As you hear yourself have a conversation new personal realizations emerge.
7. A coach can be another source of creative ideas. You can brainstorm and try out new ideas, behaviors, and mental processes as your coach provides a safe place to experiment.
8. A coach can help you create your vision. Your coach can assist you in developing your plans for success based on your values, personal strengths, background, and assets.
9. A coach can help celebrate your successes and be a source of strength when you fail. Your coach can be a supportive and nurturing source of energy.
10. A coach can help you process life. Life is a process and a good coach can assist you in reviewing and reframing what happens in your business, your sports, and your life!7
If some of these points are goals you would like to achieve, the benefits should be apparent.
The answer to the benefits of implementing the approaches and principles laid out in this book are based in your belief system. You will achieve these benefits if:
• These approaches and principles are what you want.
• The benefits as described are what you are looking for.
• You are willing to work hard to get them.