Elite advisers focused on employees and operations for future growth

Continued success will require more than marketing focus, top performing firms say.

The fastest-growing and most profitable financial advisers are focused on improving their internal business operations and their human capital management, a new report found.
So-called “elite” advisory firms attributed their top-level performance in the industry to carrying out a marketing strategy that attracted and retained clients better than most advisers, according to a report out Thursday from InvestmentNews Research and BlackRock Inc.
But down the road, many high-performing advisory firms believe their success will hinge on additional factors.
About 57% of top firms said having the right employees in the right roles will be the biggest driver of their success going forward, “The Study of Elite RIAs” found.
(More: Top 10 adviser marketing myths)
MARKETING AND STRATEGY ARE KEY
About 44% of the top firms said marketing and strategy will be key to growth, and two other important drivers of future success were effective technology use and growth and retention of clients, according to the survey, which was conducted Feb. 6 through March 18. About 61 of the 410 firms that completed the study were identified as “elite,” having more than $250 million in assets under management and ranking in the top 50th percentile in firm productivity.
With clients having ever more investment information and advice options at their fingertips, registered investment advisers need to think differently about their businesses going forward, said Mark Bruno, associate publisher at InvestmentNews and head of InvestmentNews Research.
“Expecting to succeed on the heels of market appreciation, investment performance and word-of-mouth marketing alone is a recipe for mediocrity, at best,” he said.
The report offers short-term and long-term suggestions for advisers seeking growth.
Among the survey’s findings, elite advisers believe digital investment advisers, commonly called robo-advisers, offer an opportunity to expand their own services and their client base, as opposed to being threatened by these new industry players.
(More: 5 ways to protect your firm from robo-advisers)