How Gretz Consulting Group Helped a Successful Team of Financial Advisors Take Their Business to the Next Level

Situation Analysis

One of our coaches was engaged to help a team of senior financial advisors streamline their business model and move to the next level. The team consisted of three senior advisors and two support staff. All of the senior advisors had been in the business for over ten years and the lead advisor had been in for over twenty-five. The team’s revenues were $2.17 million with nearly $220 million in assets under management. Their goal was to increase revenues to $3 million per year.



When we did a business analysis of the team’s practice management we found the following:

• Total revenues of $2.17 million on assets of $220 million
• 850 total accounts with 86 percent of revenue generated from the top 400 accounts
• No consistent process for dealing with new or existing clients, i.e., no client service matrix
• The team had not yet segmented its client book
• They had no consistent business philosophy [e.g., transactional vs. fee-based]
• The team was not bringing in new accounts / assets
• There was a great deal of frustration in the team regarding compensation and hours worked – one financial advisor complained that he worked 12 hours per day while another only worked six and the third wasn’t bringing in new accounts / assets
• The team was on the point of breakup over the compensation issue


Planning Stage

After analyzing the team’s practice management, we made the following recommendations:

• Segment their existing clients using the following criteria 1) total assets under management in all client’s accounts; 2) total revenues generated by those accounts; 3) total potential assets to be managed; 4) willingness to provide referrals; and 5) the quality and number of referrals provided.
• Reduce the number of current accounts to 300 or less (based upon research conducted at a major firm that a single financial advisor could give quality service to no more than 100 clients) so they would have time to properly service their large accounts as well as prospect for new ones.
• Create a client service matrix to provide consistent levels of service to each client based upon which segment they fell into.
• Move all clients with assets under $300 thousand to the Client Service Center [this would remove them from the team’s responsibility while providing quality service to those smaller clients].
• Make certain that every client within the top two segments, who wants one, has an updated financial plan.
• Create a job description for each position on the team that clearly sets out expectations for duties and acceptable performance and agree upon compensation based upon the job description.
• Create a standard operating procedure [S.O.P.] for each position on the team and for each major action [e.g., order entry, new account processing, etc.].



Three months into the coaching program, the stock market dropped from 14000 to 6500, significantly reducing the team’s assets under management and fee-based revenues. As a result, it was much harder for the team to let go of small accounts and the revenue they represented. However, until the small accounts were removed, the team had little or no time to provide adequately for the increased service needs of large accounts who needed both constant reassurance and explanations of the market’s actions and their affect on the clients’ financial future [a problem faced by almost every financial advisor and team in the industry]. It also left members of the team with little time to prospect for new accounts. Finally, the drop in assets and attendant revenues exacerbated the conflict over compensation among the team members, causing frequent angry discussions of breaking up the team.


Stage One

The team began segmenting its clients and moving the smaller accounts over to the Client Service Center. Unfortunately, because of the market drop and hesitancy to give up assets and revenues no matter how small, the team took a year to reduce the number of clients to 500 instead of three months. It took five months to calm the conflict over compensation within the team. During that five months, the team was slow to maintain clear communication with existing clients and even slower to prospect for new clients. They brought in only $5.6 million in new assets while existing assets were reduced by over $30 million. It took over nine months to complete an effective client service matrix and make sure that 90 percent of all clients in the top two segments had up-to-date financial plans.


Stage Two

Once the internal conflict was cleared and significant progress had been made in removing small clients, effective prospecting increased dramatically and new clients representing over $20.5 million in new assets joined the team. The team completed S.O.P.s for critical actions as well as clearly defined job descriptions and duties for each team member. Due to the reduction in market value of assets held, the team’s revenue for the year was reduced from $2.2 million to $1.7 million despite an increase in new assets of nearly $26.5 million and a recovery of market value of $6 million for a total of $252 million.



Due to the streamlining of accounts, resolution of internal conflicts and improved business practice management, during the current year the team has been adding new large clients at an average of over $2+ million in assets per month. Their current assets under management at the end of the first quarter is $273 million among 534 client households and is on track to generate revues of nearly $2.5 million for the year.