With changing times, clients are getting demanding and competition is increasing. Thus, the need to have a team in place has become even more essential. Working in a team helps you to widen the area of expertise and allows you to explore more opportunities within the advisory space.
A report titled ‘Be Part of Something Bigger: Teams in Retail Wealth Management,’ by PriceMetrix, an US based research company, reveals that financial advisors working as a team are more popular than sole advisors.
According the report, about 55% of advisors in USA were working within some sort of team in 2012 that has grown more to 68% now. The report shows that the concept of working in a team environment holds a strong appeal to many investors. While the survey was conducted in USA, this holds true for India too.
Disciplined approach
When working with a team, it helps you analyse our own strengths and weaknesses. When you team up, it allows each of the members to focus more on the skills that they can do well. As the survey shows, teams manage more assets, generate more revenue and maintain more client relationships than sole practitioners. Gajendra Kothari of Etica Wealth Management says, “Working with a team helps us do SWOT (strength, weakness, opportunities and threats) analysis. We evaluate the area of improvements and try to develop them. For advisors operating independently, they are managing everything alone which creates a lot of pressure.”
"For us working with a team means situational leadership which helps the person of relevant abilities to take leadership," says Amit Biwalkar of Sapient.
Helps you increase company’s productivity
A one-man orchestra has its limitations. When an IFA tries to do everything by himself, he is spreading himself too thin. By adding team members each of whom contribute their skills and talents, the environment becomes more productive and profitable. Say by hiring an office assistant for Rs. 15,000 to do the back office, client servicing work, you are able to free yourself from routine chores. Now you can use this time saved to generate extra business that generates you an additional revenue of say Rs. 30,000. Clearly adding on team members can help you raise your profits.
Deeper, long lasting relationship
Clients of team based advisory business exhibit greater willingness to discuss their financial matters. “Often, the main reason why clients hesitate to invest is because they fear getting cheated. Working in teams builds the trust among clients, which lasts longer,” adds Gajendra.
Working with the team also means that clients do not have to depend solely on you. If you are sick or on vacation, there are other members accountable to manage clients. This continuity ensures client commitment.
Helps in building your brand
Working with a team helps create a brand image for your firm. “When clients come to us and see a whole dedicated team working to support them, they feel confident and show a readiness to work with us. This gradually creates a reputation for our firm,” adds Vinod Jain of Jain Investments.
You can target HNI/UHNI clients
Independent advisors have been primarily relying on word of mouth to get new clients and referrals. But advisors working with a team certainly have an added advantage. Generally, when you are trying to acquire institutional clients or HNI/UHNIs, having a team can help you acquire them easily. “There are many ways to acquire new clients. But working in a team gives a sense of security to the clients when we pitch any product to them. Generally, to acquire HNIs clients, team based planning works in our favour,” points out Amit.
Helps you in succession planning
While not many advisors think about succession planning, working with a team can help you get identify a suitable successor for your business. “We hire young talent and train them. They can be groomed to become head sales, financial planners, etc. but working with a team certainly helps you to decide the eligible successors of the firm,” adds Vinod.
To conclude, teams grow faster as compared to independent advisors because it is easy to gain clients’ trust, which ultimately helps create long lasting relationships.
Key Takeaways
- Helps you follow an organized approach
- Team helps you maintain stronger and deeper relationships with the clients
- Team helps you to define your brand
- Working with a team ensures client commitment
