You Don’t Need a Business Plan Template to Business Plan!

We are officially three weeks away from the year 2020, which sounds so weird to say! I hope that you all are in the midst of some hardcore business planning for next year. There were three things I want advisors to complete before the end of the year as it relates to their planning.

The first is finding time to do some individual thinking, strategizing, and writing. So that’s just you spending an hour intentionally thinking through what you want to achieve next year, what you want the business to achieve, and the outcomes that you hope the people around you can achieve. In other words, team members and partners.

The second thing is finding time to conduct or facilitate an offsite with your team where you are sharing that information and then getting their buy-in, number one. Number two, identifying what it is that’s on their mind and what they want to achieve and what they want you to achieve, and then coming together to really identify the theme of the year. This is an exercise that I always find helpful. Of course, you’re going to set goals with your team and you’re all going to be clear on what the journey’s going to look like next year. But, try this at your next team offsite: come up with a word, phrase or sentence that represents the theme of the year. So this year, maybe your theme was “finding efficiencies in processes and systems”. Maybe your theme for next year is “intentionality”. This is helpful because it gives you something tangible you can constantly refer back to month after month, quarter after quarter, and say, “are we really being intentional with these decisions we’ve made around technology or marketing or hiring?”.

The third thing is, I think it’s important for advisors to spend separate time on their marketing plan. In an earlier podcast, I talk about how advisors get so caught up with downloading the right marketing template and filling out this 48-page document on their company’s intranet that they sort of miss the whole point of marketing planning, which is to think about highest-impact and lowest-effort activities. So, how can we intentionally connect with clients and consumers in a way that’s conducive to the way we already do business, and that’s conducive to the way in which they want to purchase goods and services from us? So in an earlier podcast, I actually speak about setting a budget between 2% to 10% of gross revenue, which is usually the marker, and really simplifying the marketing plan into four basic categories. You can listen to our earlier podcast on that.

Today, I want to talk about simplifying your business plan. Like marketing plans, advisers are always looking for the perfect template to complete their annual business plan. And they hire coaches and consultants to help them do really fancy exercises around business planning. What I say to most advisors is, there’s no need to do any of that. Now we do know that the likelihood of something coming to fruition when you actually write it out is much higher than if you simply think it or say it. So, I, of course, recommend that everybody has some sort of written plan. But, my point is, go easy on yourselves. You have enough paperwork and exercises to do in any given year, on any given day. So here’s a really simple way to think about your business plan in that “individual thinking time” that you’re going to be doing for business planning this month.

A couple of things I want you writing down; the first is your revenue goal for the year and what that represents in terms of year-over-year growth percentage. What’s always been interesting to me is how many really successful advisors don’t even do this part, and how many folks grow by happenstance and by chance, instead of having an intentional plan. So if you’ve always been somebody who can simply achieve goals without having to write them down, what I’ll ask you is, get in the habit of writing them down, not for the sake of you, but for the sake of your team. What we know about team member profiles – their actual personality profiles – is that most people who represent the support cast of a team need quantitative goals, something tangible to work towards. So the first thing is “set revenue goals”.

If you’re having trouble even deciding how much you should grow year-over-year, look at the three-year rolling average (or increase it a little bit, by the way, year-over-year). Or, come up with a growth philosophy that ties to vision. So for example, if you have a desire and it’s your vision to double the business over the next seven years, it’s really easy to work backward to see what we have to hit year-over-year to do that. The second thing you should be doing is setting AUM goals, especially if you have lead advisors or associate wealth management advisors on the team. Allocating the percentage of AUM that you want to bring in, net new, the percentage that you want them to bring in, net new, and the percentage that’s going to come from client assets (of course that only can be a guesstimate). But we do want to differentiate between net new, and what we already have in our book of business.

So your revenue goal, the percentage that represents in year-over-year growth, your AUM goal, and then five objectives tied to specific areas of practice management. So bear with me here and if you have a paper and pen, write this out. You’re going to be setting goals for:

• Team
• Business structure
• Growth
• Efficiency
• Continuity

By the way, these don’t have to be numeric goals. This is your business plan. Simply write out what you want to achieve as it relates to your team.

So here’s what you may write, as it relates to your team; “I would like to see my lead advisor get to the next level within his or her development pathway”, “I’d like to see him or her achieve the CFP certification” and “I’d like to see 10% of business revenue come in from other people, other than me by the end of the year”. Another objective you may have within the team is that you’d like to “add additional talent dedicated to business development and marketing”. I’m making that up, but here is where you have the chance to free-form think about your strategic objectives within your team.

Same for business structure. Do you have the desire to merge? Or begin to toy with the idea of merging with another firm? Do you have the idea that you’d like to start thinking about setting up phantom stock for team members or creating paths to partnership for team members who potentially could be partners?

Then you have growth and efficiency. Here’s where I want you to set the objectives and philosophy around growth. So for next year, your objective within growth may be that you’d like to see, again, I said this earlier, a percentage of revenue come in from someone else on the team. I’ll also add in here, you may want to see a growth in the business; the majority of it come from A-level clients versus a high volume of A, B, and C clients. As it relates to efficiency, I want you to think about objectives that are tangible and can be translated to team members. So the turnover process for producing a proposal and plan to a client – maybe we want to shorten that from five days to two days. Here’s where you want to set objectives that team members can actually feel excited about because they have control over changing.

And then finally, goals and objectives around continuity and succession. So, obviously having a written succession plan is a must, but I think continuity planning is also critically important. So an objective for you in the year 2020 may be to have everybody on your team document their day-to-day so that, God forbid, we had to pull one of them out of their roles, or we had to bring somebody else in, or we needed somebody to be cross-trained, it would be really easy to do that.

And there’s your business plan for the year. Your quantitative goals, and then the qualitative goals around the five main areas of practice management.

I hope that was helpful and I hope this gives you a foundation and a framework for your one-hour, one-on-one time with yourself to business plan. As always, feel free to reach out to us with any questions or comments. Otherwise, I will speak to you next week, same place, same time. Take care.