Why and how to avoid advice silos

An advisory firm cannot perform at its peak when its clients are ‘owned’ by individual advisers or advice teams within the firm rather than by the advice firm itself.  Individual ownership of advice relationships results in advice silos.

Silos are problematic for a number of reasons, including the following:

  1. Information that impacts on all the firm’s clients will frequently be collected and stored multiple times in different silos.  This is an inefficient use of resources.
  2. The set of advisory skills available to each of the firm’s clients will differ from one silo to another, and will always be less comprehensive than the firm’s full set of advisory skills.
  3. Clients who feel that their advice relationship is with an individual adviser rather than with the advice firm are likely to follow that adviser if the adviser leaves the firm.

Adopting a mindset of “No Advice Silos” and implementing processes designed to break down existing silos is therefore critical in the process of building a great advice firm.  Appropriate change would include:

  • Implementing tools, processes and guidelines that can be consistently managed and audited throughout the whole firm
  • Ensuring that all client meetings are attended by at least two advisers
  • Holding all advisers (including owners) accountable to an agreed whole-firm business plan, outcomes and management processes
  • Remunerating primarily with the intent to motivate and recognise whole firm performance
  • Including junior staff in engagement processes for all clients (not just low-value or low-requirement clients)

What do you think?

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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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