When building a financial planning firm (or any business), there is a tension between personalization and optimization. On the one hand, as a business owner, one ostensibly has the right to create their own rules and only do the work that is most fulfilling to them. Yet at the same time, the reality is that planners, like anyone else, need to earn a sustainable living – which usually requires some level of systems, processes, specialization, and optimization to ensure that there is reliable income. Without optimization, it is challenging for firm owners to do what they’re passionate about… and with that optimization, advisors can feel as though they’ve built a business for someone else’s life.
In this 192nd episode of Kitces & Carl, Michael Kitces and client communication expert Carl Richards discuss how creative advisors can build a business that is both fulfilling and successful. For example, for many advisors, financial planning is more creative than technical, as it is centered on relationships and individual needs, not ‘optimal’ decisions. Similarly, many clients choose advisors not only due to their perceived competency, but also their unique personality. So, advisors may want to consider how they can further imbed their unique interests and strengths into the advisory firm offerings, trusting that it may be something which attracts clients, regardless of how ‘optimal’ it is. For example, many advisors integrate their interests into client experiences, from fishing to sharing meals, which can increase the personal meaning of the work for the advisor and the client experience.
Another part of building a fulfilling firm owner experience is to outsource. For example, many advisors dislike administrative and compliance tasks. Even if that work ‘only’ takes up a few hours, delegating or outsourcing it can create huge dividends in the advisor’s day-to-day fulfillment. Alternatively, technology solutions may be able to produce the same benefit.
At the same time, these decisions come with a trade-off: advisors can build a business designed for humans that is still profitable, but it may be less profitable than a purely optimized business. There is, thankfully, room for nuance between a solely optimized business and wholly creative acts, and advisors who build indfully may reap the benefits of both models. And alternatively, advisors may choose to optimize their business in order to fund their more creative pursuits in their own time!
Ultimately, building a human-centered firm experience does not have to come at the sacrifice of profitability. Highly creative advisors can give themselves permission to do what is most fulfilling, leveraging their unique strengths, interests and approaches. This can ultimately create a better client experience… and a more fulfilling workplace for the advisor themselves!
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