Add these four points to your resolutions for 2007.
1. ASIC – Expect the unexpected:
Mr Jeffrey Lucy – head of ASIC – asked us the question “Whose side are you on?” at the last year’s FPA conference.
He made very strong points including:
- “…[client] satisfaction alone isn’t good enough”;
- “Since 2002 you are no longer simply a provider of products”;
- “…bad advice is still too prevalent”;
- “prudent investments in retirement have never been more crucial”; and
- “…our own people have experience from the industry”.
He sounded the perfect man for his job. Have no doubt that ASIC have a mandate and clear agenda to trample on any person or firm that crosses their ‘line’ from the ‘right side’ to the ‘wrong side’. They are the enforcers and adjudicators. Their confidence comes from the legislation not their experience. Any assumptions regarding interpretations of legislation will be tested. Get ready for it.
2. The FPA – Support It:
Compliments to Jo-Anne Bloch on her leadership pitch at the recent FPA Conference. She touched on every major issue facing our association except one in the conference’s opening address, and resolved to get into them. In my opinion, she only missed the issue of institutional funding and influence of the annual convention producing less planner attendees and more product suppliers.
Our young industry is bursting with growth. Growth needs to be directed, not left to its own devices. Too many good advisers are doing and saying nothing to support the industry direction, whilst being quick to criticise and similarly influence their peers. It’s a given that no one in this industry has spare time. It’s a question of priorities, not time. Take a trip to the UK marketplace, where far too many disparate groups and associations representing too few practitioners are achieving very little. Get involved.
3. Your Business – Be successful on purpose:
What are your objective measures of success for 2007?
- What does client success look like in 2007?
- What number of referrals are you expecting (referrals are a great indicator of client satisfaction)?
- How will you objectively determine the quality of your value proposition in the minds of your clients?
- What growth rate indicates success in your various client segments?
- How many new client niches will your firm build over 2007?
- What profits are you going to achieve?
- How quickly will new staff come up to speed?
- How do you know how well you are doing?
- What is the ideal team structure at the end of 2007?
Without goals, it’s damn hard to be successful on purpose.
4. Your Decision Making – Separate Control and Being in Charge:
This is probably the hardest resolution. Change the way you make decisions in your business.
For reasons of competition, consumerism, regulation, innovation – all the natural forces of capitalism – the road ahead for our industry will soon divide. The high road will be taken by business people building an advisory firm. The low road will be taken by advisers building a business. The differences are subtle but crucial for your success.
Business people understand the differences between being in charge and being in control and the advisers don’t. Being in charge is the responsibility and privilege of the owners. They own the firm and its strategic direction, and formulate the milestones that indicate success.
Being in control of the day-to-day operations to ensure strategic directions and milestones are achieved is a very different role to being in charge. No quality sporting event would work without referees or umpires controlling the game. However, each day thousands of small businesses consistently fail to perform due to lack of internal ‘umpires’ or ‘referees’. Most owners of advice firms adopt the ‘umpire’ position by default. Thus, it’s consistent failure. Get talent that can enforce accountabilities, communicate, and respect the owner’s objectives. Then let them do their job.
Have a great 2007.