For every mortal, time is finite. You get only 24 hours a day, and no one can push that to 25 (no cosmic exceptions, please).
For professionals, time is a precious resource, the value of which must be maximized. That means leveraging your time — multiplying your ability to get things done by delegating nonessential tasks to others who can execute them either more efficiently or at a lower cost.
For financial advisers, time spent on noncore functions — those activities that aren't directly correlated to building the business — ultimately equates to lost opportunities for the firm. In fact, among the registered investment advisers who responded to The
Charles Schwab Corp.'s 2011 RIA Benchmarking Study, 52% reported that devoting sufficient staff time to business development was the greatest barrier to growth.
WORKING SMART
So how do you win back your time? It really is about working smart: training staff, creating work flows and allowing technology to take over what it can.
By outsourcing, you can spend less time on non-revenue-generating activities and more time on serving clients, engaging with prospects and driving growth.
How are you using your time?
Here is a new benchmark: A survey by Aite Group LLC of 146 RIAs found that just under half (48%) of their time is spent on client management. The rest is spread across operations processes (22%), client acquisition and prospecting (18%), and investment research (11%).
As the survey shows, advisers are spending less than 20% of their time on client acquisition and prospecting. A firm can't grow if its advisers aren't bringing in new business.
They spend slightly more time on operations — often because they lack support — than on growth. Newly independent advisers may have particular difficulty with operations because they must learn to replace the administrative and operations support that their former employers provided.
This is where outsourcing can play a significant role. It lets you spend your time on what you do best: guiding clients and prospects, and devising financial strategies that will help them meet their life goals.
TECH TOOLS
Running an advisory practice requires technology; running a high-performance practice requires excellent technology. Excellent means integrated so that you aren't forced to re-enter data as you jump from one application to another.
You don't have to invent your own solution. Outsourcing reduces the amount of time and stress devoted to operations, data management and backup, reporting and reconciliation, re-balancing and more.
By making you more effective and simplifying your life, it expands your time.
It also may force you to standardize your work practices so that they can be embedded as work flows. Bringing in new accounts, issuing updates — you are likely to have standardized these functions.
Outsourcing also can make your practice more accurate and timely.
Take account reconciliation, for instance. Outsourcing can provide you with trade-ready data in a timely manner.
Also, look at aggregated reporting. It can give you a holistic view of clients' accounts, even when clients have multiple accounts across several institutions.
Using a web-based solution increases your efficiencies even further by eliminating server maintenance and manual software upgrades.
You can automate and delegate routine tasks so that as your business grows, you aren't forced to hire additional support staff. One way to ensure that your existing support staff becomes adept at using the outsourced solution is to make improving their skill set part of their incentive package.
Although price is always important, it is far from the only factor.
When evaluating an integrated solution, it is important to compare each provider's scalability, scope of reporting capabilities, integration, customization and customer support.
Ask for references from businesses like yours in scope and scale. Look at the financial stability of the firm, because nobody wants to deal with recovering files from a service provider that goes under.
To realize your true potential as an adviser, as well as that of your firm, it is important to maximize your time with the activities that are most important to your growth. Use your tools — there are so many available.
Marion Asnes (marion.asnes @envestnet.com) is a managing director and chief marketing officer for Envestnet Inc.
