To grow your advisory, you need to identify and then diligently support those staff members who can 'fill the bucket' by bringing in new clients.
Business owners naturally focus on costs and expenses to maximize profits. Salaries, rent, the cost of benefits, and other normal overhead expenses remain relatively fixed during any given year. But rather than fixating on expenses, think of these as holes in your budget bucket. Instead of obsessing on trying to keep these costs as low as possible, focus on filling the bucket.
We recently had a billing snafu with a vendor. They failed to process a payment and hit our account with $35 in penalty and interest charges. Our accounting service and two employees spent several days and endless emails and phone calls to get it resolved.
I thought about how much time and effort we spent to save $35, and I realized how wasteful we had been with our time. My employees could have been scheduling client meetings for our advisors. Our accounting service could have been fine-tuning our budget for 2017 and working on the business metrics I need to evaluate our firm's profitability.This led me to wonder where else we were focusing on the wrong things.
I had the opportunity to spend some time over the holidays with a business turnaround expert from Australia. He described a recent project where he took a struggling company and doubled its sales in less than a year. I asked if he had to replace most of the staff to accomplish this, and he said no, the staff was fine; they were just focused on the wrong things.
Needless to say, after my $35 fiasco, he had my full attention. The owners realized their sales were dropping, so they went on a cost-cutting mission to maintain profitability. They suspended advertising, reduced the expense accounts of their salesforce, and cut support staff.
It sounds so foolish, but it is a natural reaction when cash flow drops to focus on cutting expenses. We all do it personally; it is how households work. But it is absolutely the wrong thing to do in a business.
When I asked how he turned them around, he told me about "filling the bucket." He restructured the compensation of the salesforce to reward the highest producers. He increased their expense accounts for meals and entertainment of clients and prospects and penalized those who did not spend their monthly amounts. He forbade them to eat lunch in the office or with each other. He brought back the support staff for the sales department and all but banished the salesforce from the office. He wanted them meeting prospects for morning coffee, talking business on the golf course, and taking good clients and referral sources to dinner.
He told me that the entire company exists to support the salesforce before, during, and after the sale. Time that a salesperson spends fixing a client issue is time not spent finding and closing another sale. Creating proposals and implementing the company's solutions are tasks that support persons should be doing--not the salesforce.