Read The Transcript Of The Episode:

Speaker 1: This is the Ultimate Advisor podcast, the podcast for financial advisors who want to create a thriving, successful, and scalable practice. Each week, we'll uncover the ways that you can improve your referrals, your team, your marketing, and your business operations, helping you to level up your advising practice, bring in more assets, and create the advising practice that you've dreamed of.

 You'll be joined by your hosts, Bryan Sweet, who has more than half a billion dollars in assets under management, Brittany Anderson, the driving force for advisors looking to hire, improve their operations and company culture, and Draye Redfern, who can help you systematize and automate your practice's marketing to effortlessly attract new clients. So, what do you say? Let's jump into another amazing episode of the Ultimate Advisor podcast.

Brittany A.: Welcome back to the Ultimate Advisor podcast. I am Brittany Anderson. I've got with me of course, Mr. Draye Redfern and Mr. Bryan Sweet. Today we are diving into episode eight of a 12-week series, where we have been talking about characteristics of top financial advisors. So for today's topic of discussion, we're going to touch on how you can act more like a business than a practice. How you should be focused on building enterprise value. So this is going to be a really good discussion, a really good topic because so many advisors that we encounter through our coaching, through the mastermind, even on inquiries from this podcast, so audience members, we know you're out there. One of the commonalities that we're hearing is, "Hey, I'm to a point in my business now where I should probably start running it like a business. It's not just me anymore, I've got a team, I've got responsibilities that are much deeper than when I first started."

 So Draye, I thought you would be a great one to kick us off today to talk about the difference between running a business versus focusing singularly on running a practice.

Draye Redfern: Thanks Brittany. I think there's a couple things here and that in and of itself is like a dichotomy in the way that many advisors think. The ones who are having success are really treating it as a business, whereas the ones who may have plateaued or maybe they just feel like they're beating their head against the wall or they're working really, really hard, but they're not necessarily hitting those goals are running it like a practice.

 And so to give you a little background on this, I cut my teeth in business serving attorneys long before helping financial advisors. And what was really interesting is that it's sort of like overlap. Is that attorneys would work an hour bill an hour, work an hour bill an hour, work an hour bill an hour until the cows come home, and one third of attorneys are classified now as alcoholics. What's really interesting about that model and having grown up in business around that is that it's not just attorneys. CPAs struggle with this. Financial advisors struggle with this. Physicians struggle with this. And there's this almost like it's not acceptable to run your business like a business, you need to be running it like a practice.

 However, that doesn't really make any sense, or as a practice, it's almost really just like a solopreneur who's trying to run or has a disguise of a business. Whereas if you actually shift this mindset to where you're actually showing up everyday and you're treating your business like a business, that means, as cliche as it may be, you're working smarter not harder. You've got a team around you that starts to pull more and more things off of your plate. You have systems and processes that actually make it easy to follow, duplicate, and have a business that can really begin to remove you as one of those constraints.

 Now, we talk to so many advisors through the Ultimate Advisor Coaching Program and through the mastermind where they're at this stage where the primary advisor is trying to scale to the next level. They're trying to treat it much more like a business, but they have all this previously held beliefs. And those beliefs are, "I need to be in that meeting." Or, "I need to be the one picking up the phone." Whereas you don't always have to be that person, you don't have to be every aspect of the business.

 And so one of the things that's really important and we've talked about this many times before is, as you're sort of transitioning from a solopreneur or from running a practice to this shift of really growing a business is, focusing on your super hero ability and then using that to then build the team and the systems and the processes around you. Because that's where you really start to run as a business. That's where you get more of the freedom. That's where you can actually then really run and control your own calendar, you can do the things that you want to, you can afford the time to take 16 weeks off a year like the incredible Bryan Sweet because you have a team, a system, and a business that really bolsters you instead of you having to carry this business on your back.

 And so Bryan, I want to throw that off to you because there's a lot to probably unpack there about how you initially sort of laid the groundwork to build that process in the early days.

Bryan Sweet: This is a topic that I think doesn't get enough exposure and what I've found is there can be a big difference between being a really good financial advisor and being a really good business owner. And before I get going, I'm just going to touch base on a couple of books that I think are just a critical read for anybody, whether you feel you're good business owner or you just want to be a better business owner. The first one's called Profits First, and the second one is The Road Less Stupid by Keith Cunningham. Both are exceptional books on running a business and understanding profit and loss statements and balance sheets and team engagement and running businesses.

 What happens is you start out, you've got some revenue coming in and you've got some expenses, and a lot of the times the expenses are greater than the revenues. So you really don't have anything to track except, "How do I get more business to cover my expenses?" But with some success and with time what happens is the recurring revenue continues to go up and pretty soon you have a net profit at the end of the year and you just need to be very conscious of that. And so I think there's a couple of very critical things and I think the sooner you can do each one of these, the better you will operate your business and also the more successful you will be.

 But the first thing you need to do is have a system for how you run your business, how you monetize your business. What are the principles that you do? Well, we use in our office, it's called the EOS system, which was created by a gentleman by the name of Gino Wickman. And then there's another platform by Verne Harnish that's called the Rockefeller Habits. Either of those are really good, but having some metrics and some platform from which to run your business is really important.

 And what I found in just talking to advisors, very few of them know their individual metrics, their profit margins, all of the key revenue producing things. They just kind of flow by the seat of their pants. They end up with some money at the end of the year, might be more money than they had before and they go, "Oh, I had a good year." But what happens is with this particular business, with recurring revenue, your company is amazingly valuable. And with the multiples that you can get if you sell your business or if you're acquiring a business what you have to pay, it's amazing. And if you can run more efficiently and pick up five or 10% better profit margins just by being aware of where there are leaks or where you could be more efficient, you start generating 1 million, or 2 million, $5 million of revenue, and you take five or 10% add on profit margins and pretty soon you're talking about some serious money.

 And even if you don't use that money to put in your own pocket, it gives you more marketing money, more money for technology, any of those things. More to pay your team. I would tell you one of the biggest mistakes and downfalls advisors have is not learning the business management skills. And so I think you want to make sure that what happens in your business is what you wanted to happen. So you want to make it happen versus letting it happen.

 Brittany, maybe talk a little bit about, from your aspect of being a COO, how these processes and systems have been helpful from your vantage point.

Brittany A.: Bryan, you brought up some really good stuff there. The comment that I want to make is that when Bryan talked about having a system for running your business, you also want to make sure from the team perspective, is that you have processes and systems for how you do the things within your business. So that is going to allow you, when you talk about... Draye mentioned that Bryan takes 16 weeks off every year. That's not just by happenstance. That's not just like, "Well, I'm just going to head out and hope things are great when I get back." Everything has been done intentionally to get to this point.

 So something that I want to encourage you to do as just an immediate action is to look at some of the foundational processes that are in your business. For example, onboarding a client. It's amazing at how often we hear that these types of processes in businesses are not documented. So anything that could impact, let's just put it where it is, your bottom line, you want to make sure that you have an ironclad workflow or process around that.

 There's something that I've heard over and over again, some of these people that are hitting ceilings of complexity in their business, that are going running more of that solopreneur type of practice into really growing a business, it's they're like, "Well, yeah, I've told my team that. I've told them how to do that. Why can't they get it done? I've told them that this is what I want to happen, but there's no consistency." And that's like, well, telling somebody and giving them an actual hard and fast process that's documented on paper that they can follow and ensure that there is no room for human error or very little room for human error, I should say. That's how you're able to scale. So you can completely free your mind.

 I would say in a lot of the processes in our business, they have evolved so much because we have put the right people in the right seats at Sweet Financial that have the processes. Bryan probably doesn't even know what the process is. He just knows it exists. That's how a self-managed company should absolutely operate. So you as the key person you need to basically lay out the foundation of, "Here is the culture. Here is who we are as a company. Here is what we provide." You put the right people in the right seats and they are going to make it happen in a beautiful and exceptional way, if you as a leader are clear on what your expectation is. So again, it's not just having a system for your business, it's having all those little systems and moving parts put into play so that your mind can be freed up to focus on your own...

 As Dan Sullivan of strategic coach says and coins, "Your own unique ability, let your team do theirs, and that's how you can close this gap." That's when you move from, "Well, I'm just going day to day and I'm hoping that the wheels don't fall off." To driving the bus and knowing, "Hey, I've got all ends completely covered and we are moving in a really positive direction." So again, this allows you to have an ironclad system, have something that you know is tried, true, and tested so that you're not just throwing stuff at the wall and seeing what sticks next. So that you're actually being intentional with your behaviors and understanding, "Hey, I know my financials, I know the system that we run when it comes to efficiencies, when it comes to meetings, when it comes to our goals and our target settings." All of that is put into play when you move from just being a single practice into truly running a business.

 So before I round out the key highlights, Bryan, Draye, anything either of you would like to add?

Draye Redfern: I think that it's worth just rehashing this and just maybe listening to this episode again. Because this is one of the things that I wish I had listened to this episode probably six or eight years ago. Because it really does make a massive difference when you're creating those processes, when you can have all of the time when you want, and it took me several years to actually get to that point. So I think this may be one of the ones that I wish I had the most early on in my career. I'm sure there's going to be a lot of other advisors that way. So I just wanted to just take a second to acknowledge maybe this is that for you. And if it is, then give this one another listen.

Brittany A.: Draye, you just reminded me of something and I would really encourage not only listening to this one again, but going back to episode three in this 12-week series, it's the one on growth mindset. I think that that is absolutely relevant to kind of rehash and get your head in the right space coming into this particular episode. Because with that growth mindset, it just helps open your eyes, ears, everything to all the possibilities that running a business presents.

 To highlight some of the top takeaways from today. I think the underlying theme here that we didn't necessarily pull out but I want to encourage, is that before you can implement any of this, before you can really say you are running a business, you have to be honest with where you're at. Because if you're not honest with where you're at, if you're not seeking out help saying, "Hey, I have been the solopreneur. That's where I'm at right now, but I know something has to give and I need to be running it like a business." If you can't speak in those honest words, you are never going to get the help that you need. So never be ashamed, never be embarrassed. Just be completely transparent with where you're at because that is where you're going to get the most help. So absolutely start there.

 I would say takeaway number two is like Bryan mentioned, find a system for running your business. There are many, many options out there. I know Bryan, we use the EOS system as he mentioned. You can check that out. You can Google Gino Wickman. That's one of many sources. Verne Harnish has a great one too. So you just have to find what you believe is going to work best for your company. There is no right or wrong answer as long as you pick one and you stick with it.

 And finally, it is rounding it out with the team. It's making sure that you have documented processes and procedures for your team to follow so that you can truly run consistently. So what happens there is it no longer matters necessarily who is in which seat because the process in itself is repeatable. The workflow is there. So we use this term, sometimes it's not very pretty, but it's the hit by the bus situation where if something happened where one of your team members could not physically be in the office, nothing would get missed because things are so tightly documented as far as how your processes and your systems are spelled out. So that is the importance and that is not just important, I guess I should say, it's necessary for your business. That rounds out today's episode of our Ultimate Advisor podcast. We will see you right back here next week as we dive into episode nine of our 12-week series on characteristics of top advisors.

 Hey, Brittany here. We hope you got a lot of value out of today's episode. To access the key takeaways, the show notes, and any deliverables, go to ultimateadvisorpodcast.com. And while you're there, check out the Ultimate Advisor Mastermind if you want to learn ways to maximize your income, your impact, and your legacy through an automated practice, a self-managing team, and a killer culture that clients can't stay away from. We look forward to seeing you back here in next week's episode.