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Create A Powerful Asset With An Advisory Board

You don’t need to tread in unfamiliar waters alone. Building an advisory board for your firm will create a powerful asset that will provide advice and objective feedback elevating the level of service you provide and improving the current client experience.

Advisory boards have no fiduciary responsibility. Their advice is non-binding. Your advisory board should provide you with great feedback and will naturally become a powerful referral engine as they gain a vested interest in the success of the firm.

Eight Steps To Creating Your Advisory Board

Determine The Objective – Your advisory board will help you look at your firm with an open mind. Objectives should include; insight to product and business development, marketing and technology, and research that encompasses emerging industry trends.

Define Your Advisory Board Member Profiles – Choose clients that will become evangelists for your firm while mentoring you as an advisor. When forming your board identify clients that can provide you with diverse skills, experience and knowledge. The ideal members of your board will be open minded, thought-provoking, problem solvers and have strong communication skills.

Establish Expectations – Make sure you have clear objectives so that board members know what is expected of them. You should be specific in communicating responsibilities, the areas in which you are seeking help, and how often you will want to interact. If private information will be discussed inform advisory members that they will be signing a confidentiality agreement. You may want to consider having board term limits so that when changes are needed, board members and clients are not offended.

Develop Board Relationships – Ask your board members for their opinions and advice, and establish a mentor/sounding board relationship with them. Express your appreciation frequently and don’t be offended if you hear something you don’t like, your advisory board must be open and honest.

Prepare For Board Meetings – Advanced preparations may include: soliciting agenda items from the board (to prevent unplanned discussions) and distributing important information prior to the meeting along with your meeting agenda. Host your meeting in a location that is free of distractions and stay on track by stimulating dialogue and having a results oriented gathering. Summarize minutes and include recommendations on key issues.

Compensation – Most board members are eager to serve and help firms and will usually not expect or inquire about compensation. Consider making a donation to their favorite charity in their honor. Make sure you comply with FINRA regulations.

Keep Board Members Informed – Keep your board members excited about your business by providing them with updates at times when you aren’t asking for their advice. The fact that they’ve agreed to be on your board means they care about your firm. Keeping them up-to-date will enhance their commitment to your practice and in turn, help them be of greater value to you.

Celebrate– Find ways to celebrate your board members affiliation with you. Create an e-mail list for high-level communication or incorporate your advisory board into your website.

Advisory Board Members can help you see what you are not seeing yourself.

Embrace the insight they offer and remove the personal barriers and

roadblocks that may be preventing you from experiencing positive change.

Ironstone can assist you in developing an Advisory Board Plan. 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.

We want to hear from you!  Does your firm have an advisory board and if so, how are they working for you? Share your best ideas here!   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: Operational Effectiveness-Client Database
• Email us at info@ironstonehq.com
• Call our office at 800-917-8020
• Follow us on twitter @ https://twitter.com/#!/AndreaSchlapia
• Join us on Facebook! https://www.facebook.com/IronstoneCommunications
• Connect with us on LinkedIn @ http://www.linkedin.com/profile/view?id=29647364&trk=tab_pro


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Business Plans -Creating A Roadmap For The Success Of Your Firm

The main objective of strategic planning in your firm is to create an uncomplicated plan that clearly defines the direction of your practice. A business plan embodies your set of business goals and how they can be attained. Overall, a business plan supports the business model and explains the steps to achieve the goals of that model. You will want to be as specific and detailed as possible in each area of your business plan.

The goal of your business plan should be to create a roadmap for the success of your firm.

Ironstone’s research has shown us that approximately 40% of financial advisors actually have a written Business Plan and even fewer have a marketing plan. Those firms that implemented a completed business plan have 50% more profits and revenue than firms without a plan.

Your business plan will help you:

• Evaluate your firm and your position relative to your competition
• Provide a laser like focus to your marketing efforts
• Support your infrastructure to provide for the needs of your firm
• Diagram a route for your success

Focus Areas To Include In Your Business Plan:

An executive summary – Include your unique value proposition, how you will obtain new business, client retention practices, and your competitive advantages.
Practice Overview – This snapshot of your practice includes how it’s organized, its essential purpose, and other formalities such as founding date, legal licensing, location, etc…
Situation Analysis – Interpret the state of the environment & describe your competitive position along with the operating & financial conditions of your firm. Use a SWOT analysis in order to define your strengths, weaknesses, opportunities, and threats.
Market Summary – Describe your niche markets.
Market Analysis – Stay abreast of new market strategies and understand the needs of your community. Research current trends and potential growth in your demographic area and industry to explain how you will improve your position in the market. Include statistical information showing your current position in the market share.
Market Needs/Service Offerings – describe what your firm provides to clients & prospects. Items to include are pricing, how you will meet the needs of your clients, advertising and client service.
Competition – Analyze your competition & how your processes outweigh your competition. Explain where you want to be in relation to your competition and how you plan to reach that goal
Keys To Success – Identify three or four areas that you will focus on for optimal success.
Critical Issues – Identify three or four goals or issues that your firm plans to achieve during the year. Develop a strategic plan of how you will obtain each objective
Marketing Strategy – Attach a copy of your marketing plan.
Marketing Objectives – List the objectives of your marketing plan.
Financial Objectives – List the financial objectives of your firm and include your sales and expense forecasts along with checkpoints that will gauge performance levels.
Exit Strategy – Outline your succession plan – timeline, person(s) to retain your practice.

Once you’ve developed your business plan, don’t file it away until the end of the year when you’re making the appointment to see your CPA.   Use your business plan as a GPS guidance system for running your practice. Update it often; real-time changes are ideal, quarterly at a minimum.  Communicate your business plan to your team in order to effectively bring it to life and track milestones to enhance your overall business focus.

As you begin to develop or review your business plan, contact Ironstone for tips and best practices that will assist you in taking your firm to the next level.  We have numerous tools and aides available for you and insight that will help you reach the goals you have set for yourself and 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 – Referral Networks
• Email us at info@ironstonehq.com
• Call our office at 800-917-8020
• Follow us on twitter @ https://twitter.com/#!/AndreaSchlapia
• Join us on Facebook! https://www.facebook.com/IronstoneCommunications
• Connect with us on LinkedIn @ http://www.linkedin.com/profile/view?id=29647364&trk=tab_pro


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Begin With The End In Mind

Your succession plan should start when you make plans to open your firm.  If you want to create a purposeful life and path for your career, as you start your business think about what your exit game plan will be.  Regardless of being in the midst of success, if you do not have a succession plan, make it a priority this year. 

How should you start the process?  Think of yourself as replaceable and begin to delegate tasks to others.  Other key questions to answer in developing your succession plan:

  • At what time would you like to transition out?
  • Who will you sell to?
  • When will you make the transition?
  • How will all of these work together?
  • Are annual recurring revenues growing over time consistently or are they up and down and somewhat volatile?
 

Predictability is the preference in appealing a buyer to your firm.  Higher net cash flow and higher recurring revenue will give your firm a higher valuation. 

How long should an exit take?  Each firm is different, however, it can take months to years for the entire succession process.  When pursuing a sale the following steps can take 1 to 2 months per step and are critical in successful succession planning:

  • Preparation
  • Marketing
  • Negotiating
  • Due Diligence
  • Final Transaction
 

 Other considerations to include in your succession plan:

  • Prepare your team & your clients. Make sure your clients will receive the same level or better quality of service that they are currently receiving.
  • Train your clients so they are used to you being out of the office.
  • That the buyer can have a profitable practice.
  • That you will be compensated fairly for your practice.
  • Look for businesses that are compatible with your firm.
  • Is the business a fee-based or commission-based firm?
  • Is the firm financial-planning based or investment-management service based?
  • What is the firm’s client service philosophy?
 

As the owner of your firm, you are sure to be experiencing feelings of loss of control, loss of significance and grief.  Be aware that your team is experiencing an elevated pressure of anxiety if you leave them in the dark.  It is vital to communicate the tactics of your succession plan to your team.   

Purposeful planning is key to the entire succession planning process.  “One of the best things you can do is to work ON the business not just IN the business.”

 We want to hear from you!  Is your succession plan in place?

Contact us for assistance in following the proper steps needed for a successful succession plan.

 

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 & Value Proposition-Does Your Firm Have A Value Proposition?  Learn How To Create A Unique Value Proposition For Your Firm.