Cultivating Growth, Diversity, and Sustainable Success

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What makes a successful RIA? Ultimately, it’s the people. We know that wealth management is a people business and that relationships are the foundation of a strong enterprise. But what can an RIA do to remain competitive as an employer and financial services provider? A key component lies in your company culture and its alignment to your firm’s vision and values.

Business success means attracting and retaining the best talent. It means innovating, collaborating, and committing to the firm’s beliefs on client service and growth. To achieve great things, firms must have people who are empowered to create positive change that benefits both clients and the firm. Further, people want to feel like their individual contributions are acknowledged and that they can make a difference. Being purposeful about creating an ecosphere where people are invested and can thrive is no easy feat, but it’s a crucial part of lasting success.

This article explores how promoting individual strengths and skills, advocating for enhanced diversity and inclusion, fostering a collegial environment, encouraging diversification, and attracting a broader range of clients helps RIAs stand out in a competitive industry.

Promoting organic development of specializations

Recognizing, developing, and celebrating individual advisors’ interest areas and skills is a great way to build a foundation for an environment where advisors will thrive.

Creating an environment where advisors can show up authentically as their unique selves with the opportunity to leverage and amplify their individual history, interests, strengths, and skills is empowering and builds confidence. It demonstrates the firm’s commitment to and appreciation of each advisor and drives higher engagement. Especially in an age where up to four generations occupy the same workplace, now is the time to embrace what everyone can contribute.

Celebrating individuality shouldn’t come at the expense of establishing consistent, high-quality experiences that create scale. The key is to find balance between structured processes that reflect the firm’s brand while allowing for individual expression. That’s where the real magic happens – when you go deep with an advisor, truly understand who they want to serve, and then you enable them to make that a reality by giving them the freedom and support to work with their target clients in an authentic manner. How?

Do an intake session. You need to understand what motivates every advisor. Who represents their most rewarding client relationships? Are they passionate about working with women going through a life transition? Do they want to work with attorneys or entrepreneurs? Helping an advisor recognize who they want to serve and providing a supportive environment in which they can do that creates the path for their purpose to blossom.

Look at the data. Numbers don’t lie – an advisor who is interested in serving one ideal client may be immensely talented in another area. Some advisors find landing business more rewarding than servicing clients – do they have a strong team that complements their skillset?

Create a strategy for success. Understanding the needs and wants of an advisor and combining that with data leads to individualized marketing and growth strategies with actionable steps to achieve their goals.

There are two parts to creating an environment where advisors identify and articulate their passions. In addition to working closely with advisors and getting to know them, provide the space and structure to explore to help them stay aligned with shared goals and mission. Often, when the conversation begins, an advisor might be unsure of where to start. Then as you dig in, you can see the passion flowing out of them, tapping into the notion of who they want to work with and where they get the most joy and satisfaction, bringing all their technical capabilities and the resources of the firm to deliver unique client services and experiences. That clarity around their purpose, their why, becomes the driving force for growth and development.

Enhancing diversity and inclusion of thought

Embracing diversity, equity, and inclusion (DEI) enables your firm to dip into a broader talent pool and attract individuals with different backgrounds, cultures, and experiences. In turn, these individuals bring a wider variety of perspectives, interests, and ideas, which can further diversify and expand the reach of your firm with an ability to cater to the needs of a more diverse client base.

Additionally, fostering DEI brings a more comprehensive array of insight and experience, which leads to a deeper understanding of clients’ needs and preferences. Clients also benefit from creative problem-solving and new approaches to addressing their financial goals and needs.

Advisors and employees also benefit from collaborating with a diverse group of colleagues. In a collegiate, professional environment, diversity fosters a culture of learning and growth. It’s critical to act on your stated values and beliefs, taking demonstrable actions to break down biases and encourage employees and advisors to challenge their assumptions. Embracing different perspectives helps wealth management businesses navigate complex challenges and be more competitive.

Challenging the old culture of toxic competition

In the past, “healthy competition” in the workplace was often promoted as a means of motivating people to perform. Today, that old culture of toxic competition and fear is giving way to a more supportive, collaborative community that celebrates and rewards shared success.

Team members enjoy sharing best practices, developing collective wisdom, and creating a collaborative environment. It benefits everybody because it’s not about what any individual player brings to the table. It’s about what the entire team achieves together.

Being intentional and purposeful in evaluating people joining your firm through acquisitions or organic hiring is critical. Set high standards for technical competency and cultural alignment. If you can put talented people in an ecosphere, facilitate collaboration, and share best practices, it expands the potential for everyone individually and collectively. In some financial services environments, advisors on the same floor view each other as competitors. There are better ways to develop the best people. Build processes that aren’t about “my way” or “your way.” It’s all about stimulating conversations in which people push each other to find the best way.

Amplifying performance and strengthening resilience through expertise diversification

Amplifying performance is another potential benefit of nurturing an environment where advisors can explore their diverse interests and create specializations within their practices. Advisors who expand their knowledge and skillsets have enhanced capacity to adapt and thrive in rapidly changing business landscapes. Further, diversification and specialization can provide a hedge against downturns. By cultivating expertise across different domains of knowledge, a firm offsets the adverse effects of a decline with the positive performance elsewhere. Encouraging advisors to develop specializations can provide individual advisors with focus and clarity, while also enhancing stability and supporting the long-term growth of the enterprise. Much like portfolio diversification, having a team of advisors with a broad range of specializations reduces risk and increases the resiliency of the overall organization.

Attracting a broader range of clients

In the advisory profession, when you talk about marketing or driving growth, it is absolutely about the individual advisor story. Granting advisors the freedom to pursue their unique interest areas promotes organic growth. Instead of limiting an advisor to a single niche, advisors can build practices serving particular groups while continuing to develop generalist skills, ultimately meaning the best of both worlds when casting a net for potential clients.

Advisors can often build trust and credibility rapidly with clients within their specialty area. For example, suppose an advisor has developed expertise in helping women navigate divorce. In that case, they’ll be better equipped to connect with potential clients in similar situations, laying a foundation for long-term success. Having a group of advisors with varied specializations and generalist services can help the firm expand its market reach and business opportunities to fuel organic growth.

In summary

RIAs and wealth management firms will benefit from nurturing advisor diversity and specialization. Internally, advisors and staff have an opportunity to learn and challenge their beliefs, opening their perspectives and elevating problem-solving skills. When advisors with these elevated perspectives also develop specializations, they expand their reach and potential to win new clients. This leads to growth and success firmwide. Creating an ecosystem in which diversity is celebrated, advisors are encouraged to pursue their passions, and collaboration is a way of life will set up your organization for sustainable success.

Mike LaMena, AIF®, is CEO of Wealthspire.

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