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The business of advice

Money Marketing will be serialising Taxbriefs’ new business transformation book, the Business of Advice, across our newspaper, website and new monthly magazine Adviser Evolution. This week, the book’s author, David Shelton, explains the rationale behind the title

If over 90 per cent of advice businesses do not have a strategic plan, just think of the scale of the opportunity for the 10 per cent that do. We all know having a plan is no guarantee to success and that many advice businesses survive without one. But think about your car. It could run for years without you looking under the bonnet but what state would it be in when you finally took it to the scrapyard?

You have to think about your business in the same way. In fact, you are not just trying to maintain it – you should be actively increasing its value. There are no substitutes for creativity and entrepreneurial flair but if they are applied with superb management practice and a clear vision, their potential will be maximised.

The pressure to do this is even greater during times of change and the retail distribution review presents many threats and opportunities. For businesses that plan carefully, there is opportunity to increase value and take advantage of the combined power of consolidation in the number of advice business and rising demand for objective advice.

The Business of Advice is a new publication specifically developed for financial advisory businesses. It gives you tried and tested tools and techni- ques on how to manage and develop a successful financial advice business. It avoids theory and jargon and deals in practicalities and approaches that save you time.

To make sure that you run your business well and build an achievable plan, the book and its accompanying website deal with every aspect of managing and growing your business. The timing is critical, given the RDR changes, so an organised approach is essential.

The book is split into seven parts covering the major planning areas:

  • Practical strategic planning techniques.
  • Designing service to attract the right clients.
  • Marketing your business cost-effectively.
  • Controlling your finances and managing growth.
  • Running your business efficiently.
  • Finding and keeping the best people.
  • Finetuning your business to keep it on track.

You should begin with strategic planning to account for where your business stands and where you want to get to. The identification of the key issues that you need to deal with and how that will be done is the important first step to setting a clear direction and framework for the detailed work that follows.

When you have set direction, you can then approach the detail of service design which is essential for the RDR and especially adviser-charging.

This deals with what you are offering, who it is for and how you will deliver it. You need to define your target market and profile your clients to help design service that is attractive at a price they will pay. When you are satisfied that service is robust, you can move on to marketing. The marketing process splits into four parts. These are brand profile, client acquisition, client retention and accountable marketing planning. It is important to have a streamlined and proven process to help you organise your marketing as efficiently as possible.

The changes implied by the RDR will necessitate concentration on financial management and the growth strategy of the business. The typical liquidity issues that arise for advice businesses will be exacerbated through the RDR change process and it is likely that the value of advice businesses will increase after the RDR. The buying and selling process is important, along with the criteria to be used and succession and exit strategies.

The efficiency of your business is key to ensuring you provide service consist-ently and cost-effectively. Many businesses should analyse their main processes, from initial client contact thr- ough to review meetings for established clients. This includes the use of information technology to make sure you have the right back office software to undertake client management and adviser-charging post-RDR.

People are one of the most important assets of advice businesses. The job description provides the foundation for performance management, reward and the bonus structure. Recruitment is extremely difficult and you can reduce risk by drawing up a recruitment specification, developing selection criteria and providing effective induction. In addition, you need to pay attention to managing change and communicating well with your people. It is hard to achieve consistently high standards in this area and best practice techniques are essential.

Finally, it will often be necessary to finetune your business. There will be times when you are satisfied with your strategy and direction but the business is losing its efficiency or competitiveness. This may be more pronounced during a recession but finetuning your business is as important as keeping fit and should be done regularly. You will get to your destination more quickly and use fewer resources.

Content serialised from The Business of Advice, the first dedicated adviser’s guide to running their business, published by Taxbriefs at £140, details at



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  1. Info as forwarded from David Lamont

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