Success on purpose: what makes a good practice plan

Business Growth / Marketing / Practice Management / Strategy / 13 June 2019

David Haintz - Success on purpose: what makes a good practice plan
David Haintz - Success on purpose: what makes a good practice plan

With a new financial year around the corner, advice firms should be setting to work or finalising business plans for 2019/20.

Yet my experience shows that only about 20 per cent of firms have written plans, and few of those that do treat them as a living document, meaning they don’t get full value from them. Worse, these plans are often ‘top down’ management perspectives, leaving little opportunity for advisers themselves to consider how they will contribute.

My observation is that the number one challenge for advice businesses is growth. But while top quartile firms are growing at between 26 per cent and 31 per cent, the majority are either growing only modestly, are stagnant or are even going backwards, the latter disguised only by market growth in the case of AUM fee-based firms.

Believe it or not, the average firm needs to factor in negative income or outflows each year of 7-8 per cent. This can be due to lost clients or from negotiated fee reductions. But the main driver is from firms operating on a AUM fee basis, outflows for pensions or lumpy items like holidays and home deposits for kids.

So, in this example, a firm looking to grow at 15 per cent, and starting the year at -7 per cent, would require a 22 per cent turnaround to achieve its target. Of course, you could argue that markets in most years might help you achieve part of this growth, ideally though, you want to be in control of your growth plans, not praying.

In simple terms, a plan must cover where you are now, where you want to get to, and what you need to do to achieve that. The key is that effective planning is not just about targeting numbers of clients and revenue. Those are the outputs. But they are determined by the inputs, which is the activity needed to drive those outcomes.

Start with the Goal

So I recommend you begin with the end in mind. Think of what you want to achieve professionally and economically in the next one, three and five years.

You could start with your ‘why’: Why are you a financial adviser? Why do you work with your existing firm? perhaps list your values or guiding principles. Check they align with those of your firm. What are your goals and aspirations, and when do you want to achieve them?

You could ask yourself how many weeks you want to work each year. Reflect on your value proposition and personal brand. Complete an honest appraisal of your strengths and competencies. Conduct an audit of your relationships, spheres of influence and marketplace for untapped opportunities

Achieving clarity on your value proposition, ideal client type, and any market niche is vital, as is understanding how your client segments, client services and pricing inter-relate.

Reflect on your revenue model, taking into account a range of potential drivers like products, fees, commissions, one-offs, retainers, investments, mortgages, risk insurance and AUM. Don’t just focus on what it is now. Ask yourself what you would like it to be. And what does it need to be?

From there, effective planning comes down to three things – numbers and tools, activity, and measurement.

Numbers and Tools

Create a spreadsheet that models your position in client and revenue terms. Make an allowance for lost clients and lost revenue, perhaps assuming 7-8 per cent. Be clear on your end-point or growth target. Then fill in the gaps.

How many new clients do you need and at what average income – upfront and ongoing? And what about the run rate, or timing of that income? Will you be giving clients to, or receiving them from, another adviser in your firm?

Where will the new revenue come from? perhaps break it down to existing clients, new clients, COIs, current personal networks, and new networks.

Consider when the new revenue will come in. For example, a $12k pa or $1k per month client at 30 June (presumably paying monthly), will make no contribution to revenues for that financial year, compared to one starting on 1 July.

As well, a new client typically lags activity that been done two to four months prior. In other words, your activity over the immediate past month will determine how you start the new financial year.

Then there are referrals. While about 60 per cent of new clients come from referrals or introductions, most advisers don’t have a structured referral process for either existing clients or COIs.

Ask yourself whether these people know the depth and breadth of your offer or whether you are seeking new business. A structured process for referrals is one of the most important tools you can build.


If you want to be successful on purpose, you need to be clear on the planned actions and activities by the whole firm, and each adviser in advance.

It’s no good to submit numbers of new clients and new revenue – we need to know where those new clients and new revenue will come from – it won’t just walk in the door.

Whether it is boardroom lunches, catching up with COIs on tax planning opportunities, networking breakfasts or targeted emails, you must have a step-by-step plan and monitor how it goes.

Think of a marketing plan as an activity plan. When running an advice firm, I used to say, when it comes to marketing, you can do anything you like, as long as it doesn’t cost anything. It was tongue in cheek, but only partially. While effective marketing doesn’t have to cost a fortune, but global benchmarking studies indicate high growth firms spend around 3 per cent of revenue on these activities.


Measure all your activities, including strategic initiatives, alongside existing client calls and meetings, COI calls and meetings, etc. This should be reported on monthly.

Outputs are important, of course, but if you focus on the activity, implementing effectively and measuring continuously, the results should look after themselves.

One Final Step

A top-down business plan equals the aggregation of all the bottom-up plans of each adviser. Having both will give you and your team the greatest chance of success.

But having done all the hard work, there is one final recommended step. Consider signing your plan, or having someone including yourself, that you are accountable to. Include a statement along the lines of:

I am committed to undertaking the activities detailed in this Adviser Business and Activity Plan.  I expect that these activities will result in the achievement of my stated new business objectives.  I will regularly refer to this document and update it as required during the year.

That’s how to be successful on purpose.

Interested in this topic and want to know more?

Get in touch to have a chat with David


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