Growth is both a blessing
and a curse, said advisors at a recent forum hosted by SEI (Nasdaq: SEIC),
a leading global provider of outsourced asset management, investment
processing and investment operations solutions. The SEI Advisor Network's
Advisor Growth Forum assembled 25 of the company's fastest-growing advisor
clients to discuss current challenges and share best practices as they
strive to grow their businesses.
Attendees belonged to a diverse mix of firms, e.g. solo practitioners,
niche advisories, ensemble firms, family firms, etc. Despite different
characteristics, however, all pointed to a need to invest in firm
infrastructure including operations and staffing to enable growth.
"There comes a critical point in the evolution of your firm when you
realize your current structure or model just won't accommodate growth,"
said Paul Salisbury
, Insight Group on Salt Lake City, Utah. "The more we
grew, the exponentially more difficult things like maintaining client
service, overseeing budgets and running day-to-day operations became to
Advisors noted that they had begun or recognized the need to begin
focusing on specific areas of their businesses. Some issues discussed
* Standardization of processes. As advisors' practices grew, their
processes didn't grow with them. Particularly with specific client
exceptions, the gaps in service and inefficiencies increased. By
implementing standards and systematizing operations and outsourcing
functions, however, they were able to improve efficiencies almost
* Integration of systems. Most advisors use multiple systems for different
functions of their business -- financial planning, aggregation, custody,
etc. -- resulting in increased cost and time to the advisor. While
advisors acknowledged that integrating all systems might not be
realistic, they noted that exploring ways to consolidate disparate
systems was extremely beneficial.
* Expansion of business management. Many advisors said they were
considering hiring a COO or general manager to oversee operational
aspects of their business. Yet in doing so, advisors are presented with
new challenges -- quality staff is becoming increasingly difficult to
recruit and/or afford.
* Growth - Lifestyle dilemma. Though all advisors attending were in "full
growth mode," most stressed that not compromising their current
lifestyles was a top priority. Time, income and quality of life were all
factors they considered in their struggle to manage growth.
* Analyzing cost of client relationships. Because clients' demand for
service has increased over the past few years, say advisors, they
dedicate more time per client. By comparing time spent to the value of
each relationship, advisors can pinpoint opportunities to increase
profitability and free up time.
* Better understanding of existing technology. Many advisors felt that
gaining a better understanding of the full capabilities of in-house
technologies was critical to finding more time to spend with clients and
* Focused marketing programs. Although the majority of advisors still rely
heavily on referrals, many are realizing the need for structured,
proactive marketing programs to obtain new clients. They are investing
in numerous traditional marketing vehicles, particularly public
According to another recent survey by SEI, 43 percent of advisors
attributed growth to their decision to outsource investment processes, a
common theme among growing firms.
Guest facilitator Mark Tibergien, principal of Moss Adams, spoke on
barriers to growth advisors face nationwide, as well as leading targeted
work sessions. Cautioning advisors about their investment in
infrastructure, Tibergien challenged attendees to ask themselves whether or
not they're growing at the right pace, are growing with the right clients
or are you adding overhead to support the wrong clients.
Steve Onofrio, Senior Managing Director, Sales and Support, SEI Advisor
Network, also led sessions aimed at understanding operational challenges.
"The growth-oriented advisor experiences a unique dilemma," said
Onofrio. "The more successful they are, the harder their jobs become.
That's why it's critical to look to long-term infrastructure investment to
correct this imbalance."
Participating firms, all of which had more than $200 million in firm
assets, attended the forum because of their expressed interest in
organizational, platform and structural issues associated with growth.
About SEI Advisor Network
SEI Advisor Network provides independent advisors with outsourced
wealth management platforms that are designed to meet the demands of a new
generation of wealthy clients. In an evolving wealth management industry,
the group offers an end-to-end process for successfully transforming their
clients' businesses in every critical area, including marketing, practice
management, investment strategy and client relationship platforms. The SEI
Advisor Network is a strategic business unit of SEI. For more information,
SEI (NASDAQ: SEIC) is a leading global provider of outsourced asset
management, investment processing and investment operations solutions. The
company's innovative solutions help corporations, financial institutions,
financial advisors, and affluent families create and manage wealth. As of
the period ending December 31, 2006, through its subsidiaries and
partnerships in which the company has a significant interest, SEI
administers $366.6 billion in mutual fund and pooled assets and manages
$181.5 billion in assets. SEI serves clients, conducts or is registered to
conduct business and/or operations, from more than 20 offices in over a
dozen countries. For more information, visit http://www.seic.com.
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