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Hosted by Financial Advisor Coach, Ray Sclafani, "Building The Billion Dollar Business" is the ultimate podcast for financial advisors seeking to elevate their practice. Each episode features deep dives into actionable advice and exclusive interviews with top professionals in the financial services industry. Tune in to unlock your potential and build a successful, enduring financial advisory practice.
Ray Sclafani (00:00.142)
you
Welcome to Building the Billion Dollar Business, the podcast where we dive deep into the strategies, insights, and stories behind the world's most successful financial advisors and introduce content and actionable ideas to fuel your growth. Together, we'll unlock the methods, tactics, and mindset shifts that set the top 1 % apart from the rest. I'm Ray Sclafani, and I'll be your host. What if I told you that your firm's biggest competitive edge
isn't just your expertise, but your ability to make wealth management easier for clients. Today, clients are not looking for more complexity, they want simplicity, integration, and a seamless experience. That's precisely what we're going to discuss today. In my first book, You've Been Framed, which is fast approaching its 10th anniversary in print, I outline in detail the five steps you need to undertake to reframe your business effectively.
One, define what your noble purpose is. Number two, determine who your firm is best suited to serve that ideal client. Number three, identify the chief concerns and needs of those clients. Number four, align the services and solutions you provide with those needs. And number five, identify the other trusted advisors who serve those same clients. It is step four of this process, however.
which requires the most significant strategic planning time commitment and inevitably proves to be the most labor intensive. Translating client needs and desires into a refocused and reframed business model requires adjustments to your service offering and the composition of your technology and your team. As the needs of current and future clients evolve, it's essential to reframe what your firm does.
Ray Sclafani (01:59.308)
I've been attending a number of conferences in the first quarter of this year and the consistent pattern is clear. Top performing advisors are broadening the services they provide clients and recognize that investment only solutions are table stakes, financial planning solutions are table stakes. And today, fewer and fewer advisors focus predominantly on portfolio management. In fact,
many now outsource the lion's share of day-to-day money management operations, opting instead to devote more time to financial planning initiatives, relationship management, and business development. They view themselves as stewards of their clients' wealth, emphasizing more extensive planning capabilities, including financial, tax, trust, estate, as well as philanthropic planning, family governance. While striving to address more holistic financial challenges,
and provide more concierge type services. In reframing wealth management, these firms are doing four things really well. Number one, they're becoming the client's wealth facilitator. Now this word facilitation is interesting. The root word is facile, which means to make easy. It conveys the desire to simplify your client's lives by vetting and aligning trusted estate attorneys, tax professionals, bankers.
trust specialists, all who are willing to engage in much of the heavy lifting to deliver a total solution. that wealth facilitator piece, that's number one. Number two, I'm noticing that these best in the business are reframing their wealth management firms and are increasingly focusing on integrating financial solutions that address a complete wealth picture, building the necessary expertise to provide guidance on unique challenges like
managing unpredictable cash flows and partnership buy-in requirements for corporate attorneys, like really specific specialization that encompasses the client's complete wealth picture. Number three, I'm noticing they're providing turnkey solutions that include handling the preparation of documentation, coordinating the scheduling of meetings and handling the logistics of notarization requirements. It's like getting that appointment at the attorney's office
Ray Sclafani (04:23.458)
to get all the documents signed. It sounds so simple, but it's a step that the client finds complex and getting it on the calendar and coordinating all the parties and the documents. Number four is developing multi-generational strategies to appeal to current clients and their future beneficiaries. We're seeing the statistics are overwhelming leaning toward the death of a spouse leads to a widow
70 % of the time seeking a new advisor, largely because the kids are telling mom to do so. So facilitating family meetings early, navigating family dynamics and wealth transfer planning, encouraging cross-generational engagement and family philanthropic decisions. Well, all of that's critical if you're going to build a true strategy to focus on this multi-generational opportunity. One part financial planner, one part tax consultant.
one-part financial coach, these advisors are evolving to meet a higher bar of client expectations and acting as a true wealth facilitator. Much like CRM, portfolio management software and sophisticated planning tools have helped advisors take tremendous strides in freeing up capacity and improving the overall client experience over the past two decades. New technologies like social media, on-demand video, and even AI
are becoming more widely embraced, adopted, and integrated. Firms are investing significantly in digital engagement tools to enable their advisors to connect with clients more frequently and on their own terms. Even the wirehouses, which have traditionally lagged behind some of the RIAs in adopting new technology just because the sheer deployment in large organizations and compliance challenges, well, even they are aggressively encouraging their FAs to engage.
in video and social media promotion. RIAs who heavily rely on digital tools and workflows spend 25 % less time on operations and 10 % more time on service per client. So to remain competitive, investing in technology that enhances the client experience and streamlines collaboration within the firm, with the client, and with other professional service providers will be essential to your future success.
Ray Sclafani (06:47.554)
The strong correlation between higher technology spending and growth rates should make the investment significantly more palatable. Firms that embrace digital transformation will position themselves to thrive as their industry evolves. Keep in mind that when you invest in cutting edge technology, you will also enhance advisor productivity and position your firm in the minds of prospective advisors.
who might be considering joining your organization. And therefore your firm now is viewed as a forward thinking organization capable of meeting evolving needs of clients. So as noted in the Schwab 2024 RIA benchmarking study, over the next five years, the average RIA firm will need to hire for four new roles while top performing firms will on average add seven new roles.
As a result, more and more firms are devoting greater time and attention and resources to talent retention and addressing current and future talent gaps. Here's what the Schwab study notes. First, developing capabilities and skill sets of team members is a top five strategic priority for the first time in the benchmarking studies history. Number two, 76 % of firms reported offering career path
and progression opportunities to keep employees engaged. And number three, more firms are realigning their employee value proposition, the EVP, to better resonate with current and prospective employees. Whether you're striving to build expertise in serving a particular professional niche or audience segment, or looking to become the go-to resource for individuals with specific wealth management needs, such as implementing trust structures to facilitate
tax-efficient wealth transfer, far and away your team members will be your most important asset. The best firms commit to creating a cycle of opportunity that attracts and retains top talent. This ensures their ability to deliver top-flight service to existing clients while safeguarding the continuity of the organization's people, culture, and values, providing competitive compensation up
Ray Sclafani (09:10.414)
pathway to achieving valuable technical skills and designations, providing competitive compensation, and a pathway to achieving valuable technical designations and actively training future leaders to grow the business, these are all key ways elite advisors attract and cultivate top-tier advisor talent. Elite firms are also turning their attention towards the next generation of future inheritors of their clients' wealth.
undertaking a range of initiatives to strengthen those relationships. From training senior advisors on ways to better engage and build bridges towards next generation clients, to hiring younger millennial advisors to help strengthen personal connections and bonds to adult children who don't want to work with mom and dad's advisor. Here's the bottom line. You've worked incredibly hard to build a successful business, evolving and adapting to changing markets.
shifting regulatory requirements, and ever-changing and increasing client demands. However, as clients come to expect more and more sophisticated capabilities and expertise, you want to be able to adjust your business strategy if you hope to maintain and or improve your current profitability. The right strategy, the right service model, tech stack, and team will determine your success. The firms that take action today
will be the ones leading tomorrow. With each episode, we include a few coaching questions so that you and your leadership team can reflect upon today's episode and maybe shift some thinking in the organization and build some actionable steps to help you succeed into the future. Today, there are four coaching questions for your consideration. The first is, what's the one move you can make right now to future-proof your firm? Technology.
client service, team members, developing next gen talent. Number two, how can your firm better integrate technology, talent and services to create a seamless high value experience for clients over the next three to five years? Think about the fact it's gonna be more of a huge tech strategy. It won't be all technology. We're not gonna all work with robots and
Ray Sclafani (11:36.076)
the sidekick advisor that interacts with the client and as an avatar. And we're not going to work with all humans. There's going to be an integration of both. So how will you incorporate and integrate all of this into one seamless, high value experience? Number three, as client expectations evolve, what adjustments will you need to make in your team structure and service model to stay ahead of the competition and drive long-term growth? And number four,
How will you reframe and elevate your firm to meet the evolving wealth management needs and demands of tomorrow's clients? Well, thanks for tuning in and that's a wrap. Until next time, this is Ray Sclafani. Keep building, growing and striving for greatness. Together, we'll redefine what's possible in the world of wealth management. Be sure to check back for our latest episode and article.