The financial services industry is a challenging entrepreneurial undertaking whose failure rate is exceptionally high.

Some studies estimate that over 70% of financial advisors (FAs) leave the industry by their third year. What is the difference between those who fail and those who are wildly successful? Delving deeper, what is the difference between the wildly successful and the mildly successful?

A veteran of the industry once told me that the job of a financial advisor was the most miserable $75,000 per year job but the best $1 million per year job you could dream of. I have come to find after working more than 20 years with advisors, their insight is spot-on.


Over the years I have found that the strata of success in the financial advisory world looks a lot like a pyramid, with a small group occupying the top tier of success. There is also a great divide between the wildly and mildly successful. I will now give you the secret of the wildly successful.

Simply put, they have a PROCESS.

You will find that the most successful people are those fiercely dedicated to very well-defined processes that they have worked to perfect over time. We are not just talking about their investment process. In fact, a lot that is now outsourced to specialists and the advisor’s role has morphed into more of a due diligence analyst, finding and vetting professional asset managers.

Importantly, these very successful individuals and teams have a process for everything, including what they read in the morning, how they conduct meetings, and how they organize their daily activities.  They have client acquisition goals and employ strategies and processes for achieving them. They also have monthly and, in some cases, daily contact goals and processes for accomplishing those.

Taking it a step further, many of these folks have a very well defined client experience process and a contact management system to keep the experience consistent. Additionally, almost every one of these “Top-Advisors” has a very well defined investment management and client acquisition process.

The experience of these successful advisors instills a sense of confidence far beyond the typical advisor. I am not sure why would anyone conduct their business in a different way. If you think about it, can you really name anyone who was wildly successful coming into work every day and just winging it?

As I considered this, it made me think about other really successful people in other careers and endeavors where their success relied on processes and routines that contributed to and, in some cases, seemingly ensured success.

In a recent episode of “Comedians in Cars Getting Coffee”, there was a conversation between Jim Gaffigan and Jerry Seinfeld discussing the process involved in creating a great standup act. These two wildly successful comedians diligently prepare for every show and expressed their confusion with talented people who show up with the intention of just making it up.  Jim said he was a “comedian who does his homework,” to which Jerry commented, “Me too!”

Everyone at the top of their game, regardless of profession, follows a process

Looking at one of the most admired companies in the world, and my favorite airline, Southwest, you find a great example of a company whose dedication to process has bred fierce loyalty and, dare I say, love (LUV) from its customer base despite the perception that the airline industry as a whole has an awful reputation.

On the surface you might say Southwest gets this done primarily through their customer experience, common sense approach to customer service, and their ability to be transparent and competitive on their pricing.  However, Southwest is able to do these things by being efficient, creating processes that minimize and avoid the trivial and maximize flexibility for travelers. Their turnaround time on arriving and departing flights is one of the fastest in the industry (process). Their no-assigned seat boarding (process) allows for flexibility as they accommodate changes for customers easily and efficiently (process). Even their website workflow (process) is simple and straightforward. The people who work there love it and it comes across to their customers. Southwest is a great example of how creating and adhering to very well defined processes and routines can make all the difference. They certainly are not winging it (pun intended).

This concept is the same in the financial services industry. Diagnosing the exact differences between the wildly and mildly successful is sometimes not as difficult to pinpoint as you may think. Simple process checklists often do the trick.

There is a very important balance that exists in the management of a financial advisory business and anything that upsets that balance can have very severe consequences. The big three can be summarized as the (1) investment management processes, (2) client acquisition process and (3) client service strategy. These are three very different roles, but all are critical to success. In a recent meeting with an advisor, we discussed why his business growth had plateaued. It didn’t take any time at all until we arrived at a pretty simple conclusion, he was trapped in a cage of his own design. He was working 8 to 10 hours every day and every other Saturday. He talked extensively about his investment management process and how he evaluated and selected stocks and bonds based on technical analysis. His multi-screen desk set up resembled a space shuttle cockpit and he was strapped in tight.

His investment management process (IMP) had grown out of control at the expense of everything else. He barely had time to proactively execute on his client service strategy. It wasn’t something he particularly enjoyed doing but his process trapped him. Intuitively, he knew that he had all but abandoned his new client acquisition process.

We agreed that he would change his IMP to find and utilize some independent money managers. In doing so, he could turn the conversations with his clients toward financial planning. This would free up time for him to take advantage of opportunities and expand his business.

One of my favorite quotes of all time is by W. Edwards Deming, a pioneer in productivity and process engineering, who said, “If you can’t describe what you are doing as a process then you don’t know what you are doing.” It gets me very excited when I see people whose businesses really take off and the electricity that makes that light shine bright for so many is the realization of need and dedication to a business process.

Jonathan Bernstein is the Sales and Marketing Director at Stringer Asset Management, a participant in the ETF Strategist Channel.


Any forecasts, figures, opinions or investment techniques and strategies explained are Stringer Asset Management LLC’s as of the date of publication. They are considered to be accurate at the time of writing, but no warranty of accuracy is given and no liability in respect to error or omission is accepted. They are subject to change without reference or notification. The views contained herein are not be taken as an advice or a recommendation to buy or sell any investment and the material should not be relied upon as containing sufficient information to support an investment decision.

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