Raef Lee and I both wrote about outsourcing in our last blog posts. We discussed good days versus bad days and how NOT to spend your time. To me, the idea of outsourcing makes a lot of sense: Focus on the things that add value to your clients; “get rid of” everything else. Yet neither of our posts seemed to strike the usual chord with our readers. Even my video didn’t seem to get its regular number of shares. So why not?
- Do we talk about outsourcing too much in this industry? I don’t think so.
- Is everyone who should be outsourcing doing it already? Doubtful.
- Do we just not understand the benefits? Absolutely.
- Can anyone actually prove the value? We can now.
In our most recent webinar and whitepaper, A Data-backed Solution to Building a More Profitable Advisory Business, Raef and I took a different look at traditional outsourcing. We, along with our partners at FP Transitions, looked at the value of where advisors spend their time. By using FP’s database of 8,000 advisory business valuations, we wanted to quantify the difference between client mangers and investment managers – and the number is staggering.
Valuable information for the valuation
In our research, we found that 60% of advisors would spend their extra time (if given some) growing their practices – a full 82% more than the next answer. But it is not just about outsourcing your investment work that could free up that time. We expanded the traditional definition of outsourcing to include things like:
- IT and systems
- Human resources
- Back office functions
Again, are most of these functions perceived as added value by your clients?
See, read, grow
We’ve seen it before – the average advisor has too many hats to wear – everything from CIO to CMO to lead planner and relationship manger. Something has got to give; unfortunately, it’s usually growth and value of your business.
Download our new white paper, A Data-backed Solution to Building a More Profitable Advisory Business, and its accompanying research report, The Value of Time: Quantifying How Client Focus Increases the Value of Your Business. (And if you still need convincing, we created a terrific infographic with some of the report highlights.)