Game plan for success

01 April 2007 Esm? Davies, Celestis

The highest score on the board makes you the winner in many games and sports contests. But, when it comes to financial advisory practices, how you play the game really does matter. There are some crucial issues to take care of to ensure continued success.

Building a practice is about building a business team in which all players understand the goals and are committed to the game plan.

Key advisers

Especially in smaller practices, one pitfall presents itself often – your clients see you, the adviser, as the business. While this may be advantageous in the short-term, it presents obstacles later. Where the practice's goodwill is associated with an individual, the value of the practice will be significantly reduced when that person leaves. This problem manifests itself when it comes to retirement and succession planning. Sad to say, but many a financial advisory practice has met its demise with the departure of the key adviser.


Another vitally important issue is that of employees. In a recent survey conducted by Celestis amongst 1 100 South African advisers currently participating in their practice management program, only 59% of them reported having employee contracts in place. The need for written employment contracts is spelt out in the Basic Conditions of Employment Act and non-compliance makes no sense – practically or legally.

Only 12% of those surveyed have provided documented job descriptions and the same percentage have entered into performance contracts with employees. Having appropriate job descriptions and being able to reward staff on the basis of performance achievement could make the difference that is necessary to achieve excellence.

A job description is the first step in empowering staff and encouraging them to contribute to the success of the practice. It also ensures that someone takes ownership of every function within the business and caters for overlaps in responsibilities. Although not a legal requirement, each staff member should have a job description, irrespective of the size of the business.

Business plans

Another disturbing aspect of the survey was that less than 20% of the respondents appear to have a written business plan in place. Even for an individual, it helps to document one's plans. A written business plan facilitates clear thinking and often results in strategies or tactics that may not otherwise have been thought of. Where staff members are involved, the need for documentation is even more important. The whole "team" must know what the goals and objectives are and how these will be achieved. Discussion sessions help, but a written plan can eliminate misunderstandings.

Segmented client bases

More positive, in terms of the survey, was that a third of the respondents have segmented their client bases. This means that they know who their A-clients are and have established the platform to deliver excellent, but differentiated services. Again, this is something that staff members need to be aware of if they are to contribute to practice excellence.

A practice that has clearly understood goals with a written game plan to execute through a cohesive team, focused on the specifics of client service delivery, will triumph in the long term. What is more, victory will be sustainable.

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