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Chris Davies: The starting point for business planning


Having recently supported a large platform provider on its national adviser firm conference roadshow, what became apparent throughout the Q&A sessions was the mixed levels of progress made in developing and implementing a bona fide business plan.

Most firms have made good progress post-RDR but there is more work to be done in understanding the regulatory high-level standards. Essentially, adviser firms will no longer be regulated as product distributors but as standalone professional service firms.

When developing a business plan, the starting point should always be the mission, philosophy and vision for the firm. Answering the “Why we exist” question will get the grey matter going and generate some interesting ideas.

In his book, Start with the Why, Simon Senik says it is our reason for doing things that matters most and the “why” will differentiate our business from competitors and build loyal clients. The “how” and “what” come later.

A mission statement should be short, memorable, inspiring, market-focused and centred around what you want to be remembered for. Once complete, it is time to build or recalibrate your business plans.

It is important to understand the business, staff, stakeholders and clients are all on a journey. By taking a holistic approach, you can map out  the most direct line from A (current position) to B (future vision).

You then need to build in different data sets to ensure your path is aligned with your long-term objectives and goals. 

Porter’s five competitive forces can be used as a framework to better understand the issues at play.


The diagram provides examples in each segment of how competitive rivalry can be mapped and used to enhance and ensure clarity for the business case and planning process.

Next come specific long-term objectives. This is a five-year-plus view; anything less relates to goals.  

At Engage, we employ objectives called Five Keys:

1. Leadership and engagement: Corporate governance, management information, regulatory compliance

2. Client service proposition: Segmentation, retail investment products, platforms, centralised investment propositions and technology.

3. Operations and service support: Combine the front and back offices to create a middle office via support technology and a CRM.

4. People: Ensure the right people are in the right roles with the right skills.

5. Financial ratios: All relevant financial data in a dashboard and regularly tracked.

Once objectives are set, we can track them against our organisational strategies, which are shorter-term goals that run along the business plan journey (A to B). The goals can be detailed action plans, which involve individual staff members and provide specific actions, timeframes and accountabilities.  These action plans provide invaluable structure and strategy, with progress tracked at board or management meetings to ensure the actions are understood and carried out in accordance with the business plan.

By keeping things simple and aligned to the “why” question, your business plan will ensure you not only satisfy the regulator but also provide a strong foundation for loyal and trusted client relationships.

Chris Davies is managing director at Engage Insight 



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