The Elements Ironstone Blog

Current news and trending topics for sales and financial industry professionals


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Stay Competitive By Adopting A Higher Value Business Model For Your Firm

In our first blog series focusing on strategic planning and your firm’s business model (https://aeschlapia.wordpress.com/2012/02/06/how-to-define-your-business-model-and-set-the-objectives-that-will-bring-it-to-life/) we reviewed types of business models including solo, silo and ensemble firms and how strong ownership mentality helps drive success and creates focus to leverage services offered to your clients.

We also identified that your business model explains the flow of money within your firm along with identifying the services that your clients find valuable with a focus on what the largest income generator for your firm is.

Your business model has been and needs to continue to evolve for a variety of reasons including industry commoditization and increased competition.  In order to stay competitive and set yourself apart from your competitors, adopting a higher value business model will be a vital part of your firm’s success.

The structure of your business must change in order to support your new business model If not you will experience:

  • declining revenue growth
  • deteriorating client satisfaction
  • increased levels of stress on your team
  • erosion of market share
  • loss of credibility

As you change your business model, you will need to solve complex wealth management problems and build stronger relationships with your clients, all of which will require added resources.  Clients are desperately seeking advisors that they can rely on.  Provide a business model that enables them to:

  • Trust that their advisor will act in their best interest at all times
  • Know their advisor is there when needed
  • Know that fees have been minimized
  • Retain control of their assets
  • Provide meaningful educational opportunities

Providing this type of business model is important, but do not forget to share your business model with your clients and prospects.  After all, you need to educate and demonstrate what makes you different from the rest!

Include the following items while you review and refine you business model:

  • Key Partners
  • Key Activities
  • Value Proposition
  • Customer Relationships
  • Customer Segments
  • Revenue Streams
  • Channels for Reaching Clients
  • Key Resources
  • Cost Structure

Ironstone can assist you in developing an up-to-date business model that meets the needs of your clients. We specialize in identifying gaps in your existing plan and will collaborate with you to develop solutions that are parallel in achieving the results your desire.

Contact us for assistance in starting and improving your Business Model.  We want to hear from you!   Share your best ideas here!  What challenges do you face in setting yourself apart from your competitors? We always love hearing from you!

Follow us as we explore each of Ironstone’s Fundamental 4™!

  • Strategic Planning
  • Business Development
  • Operational Effectiveness
  • The Human Element

You won’t want to miss our next in the series:  Business Development-Branding


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Create Added Value In Your Investment Model

Designing a methodology for managing your client investments is essential for a clear representation of financial performance and aides in effective decision-making.  It is a generally accepted principle that a portfolio is designed according to the investor’s risk tolerance, time frame, and investment objectives.

Create Value Within Your Investment Model

“All good to great companies begin on the path to greatness

 by confronting the brutal facts of their current reality.”

Jim Collins, Good to Great

 Your goal is to create a weighted investment model (one or many) and implement a consistent investment strategy.  Focus on actions that will provide unique added value for your clients.  Position your firm to support the highest value-to-value exchange.

Evaluate your current investment model(s) with a focus on determining if they are creating added value.  Employing a one-to-many investment strategy creates the leverage necessary to optimize your resources and elevate your delivery of services to clients.

Consider the following services (not all inclusive) while evaluating your model(s) and how you will deliver added value for your clients with each service.

  • Risk Tolerance
  • Asset Allocation
  • Manager Research
  • Portfolio Monitoring
  • Rebalancing
  • Performance Reporting

While you are ultimately responsible for due diligence and oversight of your clients’ assets, you may want to consider outsourcing services that are invisible to your clients such as manager research, monitoring, portfolio construction, performance reporting and re-balancing to a third party who specializes in these services.  Other obvious outsourcing options or strategic alliances, such as CPAS, attorneys, and insurance agents will provide you the weight to focus on your firm’s unique added value and help clients with the steps they need to take.

Communication With Clients

Look at your value proposition through the eyes of your clients and prospects.  You must be able to answer the question, “Why should a client invest their money with you, versus allocating their funds in some other way?”

When implemented effectively, your investment model should be viewed by your clients as a proactive model with enhanced services and communication.  Implementation will require that you have direct systems and procedures in place to provide each service.

Advisors are required to make full and fair disclosures about fees.  Consider the appropriate fee level for your services and investment model.  You may want to implement a tiered fee structure that differentiates the service levels within your client segmentation process.

Your investment model(s) will allow you to sharpen your focus on the unique needs of each of your clients. Understanding that each of your clients has unique needs will ensure efficient client service delivery.

Ironstone can assist you in developing appropriate investment models and collaborate with you to develop solutions that are parallel to achieving the strategic goals of your firm.

Follow us as we explore each of Ironstone’s Fundamental 4™!

  • Strategic Planning
  • Business Development
  • Operational Effectiveness
  • The Human Element

You won’t want to miss our next in the series:  Business Development-Client Appreciation