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Finding Practice Nirvana

Four industry gurus show you how to create an ideal business.

C. Marie Swift, 02/02/2006

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In November, I had the pleasure of seeing the Bob Veres, Tracy Beckes, Joel Bruckenstein, and David Drucker present their first-ever Practice Nirvana workshop. The event was co-sponsored by the Financial Planning Association of San Diego and NAPFA, as a part of the 16th annual Planner Resource Day.

"The idea really got rolling when the four of us looked at other practice management sessions and realized that there was often great material there, but nothing was ever done with it," says Veres, a popular conference speaker and publisher of Inside Information. "People would hear the presentation, they would go to other presentations, and then they would go back home to their former routine. So we wanted to break through what I think is a huge dysfunction about practice management conference presentations: We wanted not simply to give information, but to find ways to change behavior--for the better."

How do you do that, when everybody in the room has a different definition of better? I asked. 

"By getting the group to focus on where they want to improve their practice, their lives, their relationships with clients, and then present information in that context, in as many areas as possible, so that whatever somebody wanted to improve, there would be advice presented in our workshop setting," Veres says.

"Once we determined to move forward and develop the Practice Nirvana workshop," Veres continues, "over the course of six months, we all contributed ideas, each in our area of focus and expertise, on which areas of a practice might need attention and might harbor inefficiencies or--as Tracy calls them--incompletions. Then, we created questions that defined a spectrum of efficiency or completeness in each of these areas, and put them into a 25-point index that helps practitioners measure how close they are to enjoying an extraordinary life and practice in the financial planning profession."

The Practice Nirvana Index

"Most advisors believe their status quo is all they can expect in the future," adds Drucker, a columnist for MorningstarAdvisor who brings a myriad of insights and resources to the financial planning community through his speeches, writing, and Web portal.

"A few advisors recognize that where they are today is a stepping stone to a more fulfilling and prosperous future. Perhaps one in a thousand has identified what their ideal practice would look like and is taking steps to achieve it. The survey we developed and use in the workshop is designed to help practitioners determine how close or far they are from Practice Nirvana, and to develop ways to make progress in all areas of their business and personal life."

Veres says, "After scoring themselves, we ask everybody to put two scores--one, their overall closeness to Practice Nirvana and, two, their rate of progress--on their name badge. This helps facilitate the daylong discussion, including the between-session times that are, of course, often the most valuable part of any conference experience.

"The overall goal is to help advisors get better at the important work that they do," Veres says. "I think it's fair to say that the four of us are all fans of the planning profession and its potential impact on the world at large. If we can help make everybody in the audience 10% more effective and efficient and productive, then the cumulative effect on the community could be enormous.

"Oh, and along the way, we try to make it interesting and fun," Veres says.

Creating an Effortless, Outrageous Business

After setting the stage for the day and helping the conference attendees work through the Practice Nirvana index, Veres yields the stage to Beckes, one of the most articulate and insightful coaches in the industry.

Beckes works with some of the industry's most prominent advisors and typically has a waiting list to get in as a coaching client.

"Does your business serve you in living an extraordinary life, or are you a servant to your business?" she asks at the beginning of her presentation.

"Remember when you first began your career as a financial planner? You transformed your passion into a money-making venture. But somewhere along the line, the work that once brought you great pleasure became drudgery. In the midst of living your dream, you found yourself with a daunting list of tasks that you don't even enjoy," she says.

"I have worked with enough advisors over the years to know that you don't have a lot of time to reminisce about the original dream. You have tons of paper to handle, employees to manage, and a huge amount of information to track. As your responsibilities multiply exponentially, you move into those unconscious, but familiar ways of getting things done. You simply react in the same manner you always have--but you can create a business that works for you if you implement a structured process that's inline with your vision."

"You can reclaim your life," she says.

As a business coach, Beckes supports clients in creating "effortless outrageous businesses" (EOBs) by routinely asking one key question: "Are you feeling energized or drained by what you're doing?" 

"People who lead extraordinary lives focus on activities that energize them," she says. "They've learned how to restructure, delegate, or eliminate the tasks that drain them. By embracing a structured process, surrounding yourself with the right people and staying true to yourself, you can create a business that authentically reflects who you are when you are at your best.

"An EOB will require more than purchasing technological tools or establishing outsourcing partners; it will require adopting a new mindset," Beckes says. "In order to completely commit to the development of an effortless outrageous business, you must have a clear vision of what an EOB would look like for you. This vision will serve as a mental blueprint to guide you through the inevitable and natural resistance to change." 

You can reinforce your vision by consistently reminding yourself of the benefits. You might think, for example, about the cumulative effects of the current inefficiencies in your practice.

"Imagine the energy expended in responding to a client request without streamlined systems" she says. "First, you spend time beating yourself up over the disorganization; you lose a few minutes looking for the requested information; and finally more time is consumed as you place the return call. This same energy could be used to move your life and business forward. 

"Use our time together," she says, "to think deeply and profoundly about what you most want in life."

Ask yourself: 

  • What parts of the business excite me?
  • What was the original reason for starting my business?
  • What is most important in my life?
  • Am I focusing on the activities that energize me?

"Once you envision your ideal practice," she says, "commit to a process, and begin taking action, one of two things will happen. You will achieve the results you want, or you will discover what blocks you from easily attaining those results. Either scenario elicits valuable information in creating an EOB.  As you explore the source of these blocks, use your mental blueprint as a frame of reference. Moving through these points of resistance will ultimately open you up to greater success in other parts of your life as well.

"What are you going to do with your one wild and precious life? At the end of my own life, I intend to look back in awe at the phenomenal life and business I've created. I want the same for you--an extraordinary business that allows you to live an extraordinary life!"

Punch, Power, and Perspective

"In my opinion," says Drucker, "advisors need to make an honest assessment of their personal and professional deficiencies, think more creatively about new client sources, and do more to maximize practice efficiency."

The commonality among these action items is advisor inertia and the tendency to persist in following ineffective strategies, says Drucker.

Drucker says, "Almost every advisor could do some critical function better. It might be business planning, relationship building or simply getting his head on straight. The problem is, most advisors will live with their deficiency instead of either improving their skills or delegating the jobs they can't handle."

Drucker observes the same phenomenon in the areas of marketing and operations. "Advisors are told the way to get clients is to hold seminars, so they spend a lifetime trying to perfect their seminar system." Meanwhile, says Drucker, they're competing with and looking just like wirehouse reps.

"Professionals get clients by referrals from clients and other professionals. Or they take advantage of the robust new market for buying and selling practices to purchase client relationships from advisors who are retiring or 'pruning' their client lists," he says.

Long known for his books and articles--many done with Bruckenstein--on virtual office tools and techniques, Drucker says advisors need to take technology more seriously. With costs of labor and compliance rising steeply, he says, advisors must seek both the cost savings and competitive advantages of document management systems, remote computing technology, and outsourcing opportunities.

"The paperless office, for example, is no longer a novelty," says Drucker; "it's essential. Broker-dealers are scrambling to provide document management systems to their reps. They know the technology represents a huge efficiency boost. They also understand they must provide serious practice management consulting--including help with technology--to keep their reps from roaming because that's what the best broker-dealers are doing now."

During his time on stage, Drucker shared a business acquisition case study--and compared its bottom line numbers with more typical growth-related endeavors, such as seminar marketing. The business acquisition strategy produced better and quicker results.

Drucker also shared insights from the 14 coaches, consultants, and industry insiders profiled in The One Thing.You Need to Do, a book he co-wrote with longtime advisor "D" Shannon.

True to his presentation's title, "Punch, Power, and Perspective," Drucker told listeners how to punch up their top line, power drive their bottom line, and get the right perspective to achieve Practice Nirvana.

How to Think Like Joel

Author and technology consultant Bruckenstein, who also writes for MorningstarAdvisor, says that, ironically, budgeting and planning are the biggest challenges facing independent advisors today.

"As a general rule," says Bruckenstein, "advisors do a great job planning for everyone except themselves. Nowhere is this more evident than in the realm of technology. Most advisors I speak with have no technology plan and no budget. They make technology decisions on an ad hoc basis, not as part of a unified business plan. As a result, their firms do not operate as efficiently as they could. According to a number of industry studies, typical advisory firms find it difficult to push their profit margins much above 40%. I maintain that well managed firms that leverage technology and outsource when appropriate can achieve margins in excess of 60%."
 
In the future, advisors will need to embrace technology to maintain and grow their business. The best way to do that, says Bruckenstein, who along with Drucker publishes a monthly practice management newsletter called Virtual Office News, is to improve their business planning. This entails developing a yearly technology plan and a yearly technology budget.

Advisors must also educate themselves. "You have to spend some time at industry conferences attending technology and/or practice management sessions. They are a great source of new idea. You've also got to stay current on the literature in the field. Virtual Office News is one great source," he says. Others include MorningstarAdvisor.com, Financial Advisor, Financial Planning, Inside Information, Investment Advisor, and the Journal of Financial Planning.

"I'm becoming increasingly convinced that many of the desktop software programs advisors use today will soon be replaced to a large extent by Web based applications,"  says Bruckenstein. "Advisors should, at the very least, be evaluating their current software packages and comparing them to the competition. If they are not regularly re-evaluating the technologies they use in their business, they risk falling behind. And it can take quite a while to catch up. Unless you have an ongoing program to evaluate technology needs, you are putting your profit margins, and possibly the very existence of your firm, at risk."

One of the objectives Bruckenstein stated at the beginning of his presentation was to help listeners think like him. How does he think through various practice management decisions? What does he look for when researching technology and solutions for his own business? He encouraged attendees to:

  • Frame the problem.
  • Look beyond the immediate.
  • Question preconceived notions.
  • Filter through a different prism.
  • Do a cost/benefit analysis.

Pulling It All Together

At the end of the day, Veres reclaimed the stage to recap key points and help participants' synthesis what they'd learned. "We are about to enter an age where consumerism will be replaced by a life of satisfaction and fulfillment," he says.

There will be a revolution in client services, based around the four Ds:

  • Discover
  • Dream
  • Design
  • Deliver

"Find someone to help you have a great life," he says. "Get some creative nagging. Commit to going through the door first and then pull as many people through as possible. As Stephen Covey says, find your own voice and help others find theirs."

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