Why time management is the key to growth
Running a wealth management firm can be a little like running across a battlefield.
Those in charge have things coming at them from all directions. Because this industry is so regulated, and getting worse, it is very important to cross all the “Ts and dot the “Is.”
Clients want everything immediately. Some employees constantly need to be coached and managed.
And of course, there are often unexpected fires to put out.
However, firms that aren’t growing are dying, and time management is the first step. Growth should be the top priority for anyone running a business.
But, it takes discipline, focus, organization and, yes, time.
All of us tend to gravitate to what is comfortable, easy and quick. There is a lot of psychology at play regarding the actions that most people choose to take.
Those who have discipline tend to have greater success.
In order to be successful, advisers should start by making a list of all the things they do each day. Then assign how much time is spent on each activity.
Ask these simple questions:
- Does this activity help increase revenue or the bottom line?
- Is this activity important, and will life go on if it doesn’t get done?
- Can this activity be delegated to someone else?
- Is doing it the best and most efficient use of my skill set and time?
At The Rummage Group, we consult with independent firms all the time that are making a very critical mistake: Nobody is focused on growth anymore.
Business owners should never spend time doing tasks that they could pay someone else a lower wage to do. This is a very important concept.
Let’s assume that an adviser has built a firm with revenue of $1 million and that adviser owns all the stock. Let’s also assume that the adviser is netting $500,000.
This means that the adviser is personally making about $200 per hour.
That means the adviser shouldn’t do low-level tasks that someone else could be paid $15 per hour to do.
Advisers who insist on doing such tasks should know that it is costing them $185 per hour and keeping them from higher level tasks such as bringing in more revenue.
Nobody will build a firm like the owner, so that person should focus on growth.
All successful wealth management firms get that way because the owner is a rainmaker. When owners start letting operational tasks dominate their time, instead of rainmaking, they become overwhelmed, and revenue suffers.
Advisers should look for employees right away to take over tasks that aren’t the best use of their time. The salaries will cost a little, but it will be paid back many times over.
And then advisers should get back to what is key: Rainmaking and building the firm. Don’t do what is easy but what is right.
This story is part of a 30-30 series on smart strategies for RIAs.