What type of financial advisory firm will you create? Part 2

In my last post (Part 1), I introduced you to my Uncle Martin and his enthusiastic approach to what he did as a specialist aeronautical engineer working for Qantas.

I also commented that many of the financial planners I know take a similar approach to their work as my Uncle Martin did to his. They specialise based upon what they do.

But there is an alternative, which you might consider in 2013:

Building a financial advisory firm that aims to be known for its expertise in self-managed super, or in redundancies, or in investment management, or in social security or in estate planning or whatever might be only a ‘ticket to the future game’ of financial advice.

That is, assume that providing, or having access to, the specific expertise to best serve the technical needs of your advice clients is a ‘given’ and ‘must have’ to participate, let alone prosper in the future market of financial advice.  What then becomes your focus?  

Consider building an advisory firm that specialises on understanding why you do what you do?

That is, build an advisory firm that makes ‘connections’ with service specialists in relevant areas (e.g. estate planning, investment management, debt raising or whatever) whilst internally honing your team’s client management, strategic management and project management expertise and specialisation in:

  • Helping pastoral families with inter-generational wealth/asset transfers;
  • Helping small businesses in the hospitality industry find funds and grow;
  • Helping time-poor dual-working ‘mums and dads’ within a specific geography or occupation achieve as much financial certainty as possible;
  • Helping small service-type businesses franchise their operations;
  • Helping ex-pat families continually manage their financial lives and in particular the cross-border financial considerations they face;
  • Helping members of a specific occupational group (e.g. dentists) build a financial life that isn’t reliant upon their personal exertion.

The focus in the above examples (or niches) is not on a single ‘event’ (e.g. buy a house, or roll over retirement monies, or apply for a pension), but rather, on helping to manage the ongoing financial behaviours of each specific group of people.

Many accountants today believe they do this.

They don’t.

They try to, but a review of their timesheets shows they are mostly too bogged down in compliance and tax work. They have however generally become their clients’ most trusted financial adviser as a result of their professionalism and annual contact in conducting their client’s tax affairs. Obviously there are also accountants who do a lot more than this.

Don’t get me wrong.

I’m not advocating that 2013 and beyond will only be viable for those building ‘one throat to choke’ type advice firms that manage a wide variety of financial matters for their advice clients.

I’m challenging you, at the beginning of 2013, to consider your natural preference about the type of work you want to do and the type of firm you want to build.

The preferences I refer to are like your right or left-handed preferences. Approximately 5% of the population are considered ambidextrous. Similarly, I don’t believe (or at least, haven’t seen) many firms that are truly experts in both the delivery of the complete technical expertise needs of their clients as well as in the three core areas of client, strategic and project management.

This isn’t new.

Financial services groups like the old Charterbridge, Stockfords, and Harts have in the past tried to provide this ‘one throat to choke’ proposition. They generally failed.


I believe such firms failed because they came to resemble a collection of silos of the various types of expertise embedded within the firm. The silos were firms within firms, which had little or no incentive to collaborate with each other and which maintained little consistency of proposition amongst the professionals within each silo.  Ultimately, fees were based upon what was done for the client rather than why it was being done.

What is your natural leaning?

Is your natural leaning like that of my Uncle Martin, who preferred and loved working on the tools as a specialist and building a specialist team focused on what he does best? Or is your preference to build a ‘one stop shop’ and great client relationships based upon your firm’s focus on client, project and strategic management expertise?

There will always be space for the great specialists. Medicine is abundant with them.

The established interests embedded in today’s financial planning industry are so powerful in our thinking, behaviours and habits that disruptive innovation, regulation, consumerism and trends are frequently seen only as distractions.

Sony may have invented the Walkman, but Apple (as of today) owns music distribution thanks to their innovation and creation of new channels of distribution.

The emerging advice profession’s proposition of being based on why you are doing what you do will not (as far as I can see) be challenged or distracted by legislation, regulations, ‘big brothers’, or performance of economic marketplaces. The new profession of financial advice will be something great, and it is much needed.

What do you want to build in 2013?

It is a great time to build a great financial advice brand.

Image courtesy of Stuart Miles / FreeDigitalPhotos.net


About Jim Stackpool

For nearly 30 years Jim has influenced, coached, and consulted to advisory firms across Australia. As founder of Certainty Advice Group, he leads a like-minded team of professional advisory firms seeking to create greater certainty for their clients. As an author, blogger, columnist, and keynote speaker, Jim is regularly called upon for his professional insights into the advice industry. His latest book Seeking Certainty is available now.

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