60 MIN WEBINAR
Will McKenna: Hello, and welcome to the PracticeLab webinars series. I'm your host, Will McKenna. I want to thank everybody for joining us today. Great to have you with us. I hope everybody's having a great summer so far. And listen, I think you're in for a real treat today. I'm very excited for our topic, which is 10 traits of top teams.
Will McKenna: Try saying that 10 times fast. And we've got two great speakers with us today. Each of these guys has more than 25 years of experience, and we've gathered their collective wisdom into the 10 characteristics of top-performing teams. And more importantly, the specific steps you all can be taking [to] incorporate those ideas into your practice.
Will McKenna: Now, before I introduce these guys, let me cover a couple of housekeeping details just to get that out of the way. CE credit — I know that's important to many of you — is available for both CFP and CIMA. To get that credit, you’re going to need to stay on the call until the end of the event. You'll also need to complete a short quiz, which is in the additional resources section of your webinar player, where you'll also find the slides from today's event. You might want to go ahead and open those up.
Will McKenna: Also, listen, we love getting your questions and comments, and we'll try to answer as many as we can throughout the event. So please keep them coming. And if you do have any technical problems, do let us know in that same Q&A window, and we'll fix it for you. Now, let me introduce today's speakers.
Will McKenna: Michael Schweitzer is director of distribution for High Net Worth at Capital Group. He has 32 years of industry experience. He's been with Capital Group for the last four. Prior to joining us at Capital, Michael worked as global head of sales and distribution at HSBC. And before that, he held a variety of senior roles as a managing director at UBS and Merrill. He's got a bachelor's degree in business from San Diego State, and he's based right here in Los Angeles.
Will McKenna: Mark Wilkins is also with us. He's a managing director of Private Wealth at UBS, and he joined UBS Private Wealth Management in 2015, after 21 years at Merrill Lynch. And he and Michael crossed paths there. Mark leads a team of six in St. Louis, very successful firm with approximately a billion dollars in assets under management. And he's been recognized by Barron's as a top 1,200 advisor for each of the last four years.
Will McKenna: Prior to joining this industry, Mark was an officer in the U.S. army, and I believe he was in a tank corps there. He's a graduate of Mizzou, great University of Missouri, where he founded the Mark & Patrick Wilkins Army ROTC Fund. Michael and Mark, great to see you. Great to have you with us today. Thanks for coming.
Michael Schweitzer: Great to be with you, Will. Thanks for putting this together, and we look forward to a great session.
Will McKenna: Fantastic. Well, what I'd like to do is go ahead and jump right in. We've got a lot of great stuff to cover. Before we get to the list of the 10 traits, and we're going to go through all of them, I do want to set the stage and, Michael, let's start with you, because I think you've got a good perspective on why is it important that advisors step back and evaluate how they run their businesses these days?
Michael Schweitzer: Yeah, it's a great, great question to kind of kick off the session, Will. There's a lot of trends that are in place right now, positive and challenging. There's a bunch of challenges relating to increased accountability and transparency and demands that are being pressed on the clients as well as expectations that clients have, in terms of how their relationship with their advisor kind of operates, expectations around loss prevention, things like that.
Michael Schweitzer: As well as the pressure on fees, and pressure on fees comes a couple of different ways. Right? Pressure on fees. Some people will say, ‘Well, my fees haven't gone down.’ But then you ask them [a] follow-on question, ‘What are you doing to earn those same fees?’ And oftentimes, you'll hear that I'm doing six times as much as I was doing previously to earn those fees.
Michael Schweitzer: So there is a significant kind of divide there. So, when you think about that, those were some of the challenges that are out there that are really impacting the industry today. And then there's the opportunities that sit on the other side of that.
Michael Schweitzer: And the opportunities are that there's never been more wealth than there is today in the world. Assets with high net worth investors are approaching $20 trillion. If you add in retirement, that could be as much as $40 trillion. Assets in the high net worth space are growing at a rate of six, over 6% CAGR, and they’re expected to continue as we go forward.
Michael Schweitzer: So, you're seeing a lot of positive things as well. And then of course, there are more advisors retiring today than there are advisors coming in the industry. And that's creating some interesting secular tailwinds for the business, for teams that can take advantage of that.
Will McKenna: Fantastic. And Michael, that's a great framing of the context that we're operating in. I love that idea of there's never been more wealth, and that 6% growth is very promising. And also, the need for your services has never been higher. I think you also talk about the importance of mindset. Is that fair?
Michael Schweitzer: Yeah.
Will McKenna: And why it's important to think in terms of an enterprise. Tell, tell us about that.
Michael Schweitzer: Yeah. Mindset is key. And Mark, I know, will jump in here in a second as well. Oftentimes people will try to enact small changes in hopes of large changes, or small tweaks in hopes of large changes. And the reality is that, if you want to create big tectonic shifts in your business, positive shifts going forward, you have to make significant changes to the way you're doing things today to make that happen.
Michael Schweitzer: And so mindset — getting your arms around that, getting your head around that, being in the right frame of mind to do that — is critical. And you referenced it at the outset here, this notion of practice versus enterprise, right? That's the key.
Michael Schweitzer: The idea that a practice tends to be really organized around personal preferences of an advisor, their individual skillsets and passions, maybe biases and opinions. Whereas an enterprise is really built in and kind of situated on a process and disciplines, and it's designed to build efficiency, drive scale and growth, and really ensure that the operation is as efficient with everyone there as it can be with people stepping out of the business from time to time.
Michael Schweitzer: So, from that standpoint, that's the real difference between, kind of, practice and enterprise, and the teams that have been the most successful in my experience are the teams that have understood that, and then they've built those systems and processes around so that they can create the leverage they need to really grow and drive scale. And Mark, I know you have [an] opinion on this.
Mark Wilkins: Yeah.
Michael Schweitzer: Let me have you [crosstalk 00:07:16].
Mark Wilkins: The way I articulate the difference between practice and enterprises, if you're really running it as I think out from my team, if I'm running an enterprise, it can exist, not only exist, it can thrive without me. And I think that is the real definition, [it’s] just a real practical definition.
Mark Wilkins: If you were not there for a month, two months, or you never came, you got hit by a truck and never came back, would your enterprise be able to continue and would it be able to thrive? And that's really how, my super simple way of defining the difference between the two.
Will McKenna: That's great perspective. I love that idea of practice is really centered around an individual, whereas an enterprise, it's sort of business routines and processes. And as you put it, Mark, something that can thrive without me, maybe a little scary of an idea, but if they can exist for a month, maybe you can take August off and do some traveling here this summer, but great perspective from you guys starting us off.
Will McKenna: I'd like to go ahead and put on the screen the 10 traits that we're going to be talking about. And let's jump in and look at those … quick answer to a question I'm seeing on the screen from our audience: ‘What is CAGR?’ And I think you referenced this, Michael. Just compound annual growth rate. So just the 6% growth rate is what you were talking about earlier.
Michael Schweitzer: Exactly.
Will McKenna: Folks, you should see on your screen, the 10 traits of the top teams that we're going to have Michael and Mark talk through, and that they've identified. As you read through these, you're going to see that they all address kind of a core element of your business, starting with client services, and then issues around running your practice, running your business, and then finally, issues related to wealth management.
Will McKenna: And what I'd invite all of you in the audience to do as you read through this list, and as we go through these during the call, you use the comment box to let us know which of those traits that you're working on the most. Where do you feel like you need the most help as we go through?
Will McKenna: We'd love to hear your perspective as we go through that. So, let's jump into number one here, Michael, and I'm going to start off with you.
Michael Schweitzer: Sure.
Will McKenna: Number one is identify your optimal client. Boy, that, that sounds obvious on the surface, but I'm sure there's a lot more to it.
Michael Schweitzer: Yeah.
Will McKenna: Why did you put this one right up at the top?
Michael Schweitzer: Sure. That's great. And it's a great way to kick off. And I really think of this as the north star. Once you can clearly define who your optimal client is, who is that individual or that family that you want to pursue, that you want to build the business around, that informs everything else in your enterprise. That informs the people and the personalities that you hire.
Michael Schweitzer: That forms the kinds of roles that you want to have on the team. That helps inform the kinds of products and services that you're going to utilize. Because if you're working with very wealthy families, you might have a different product set than if you're working with a core affluent set, or you certainly have access to different kinds of solutions that you may not be able to access if you were running a core affluent business.
Michael Schweitzer: So, it really depends. And that client set, it's not just an aspiration or something to put on the wall. It actually is the cornerstone that informs everything else in your business. And Mark and I have talked a lot about this over the years. And, and I think he's got one of the absolute best definitions of an optimal client.
Michael Schweitzer: And I know it's guided him in all of the things that he's done to build his team and develop the people around him, and most importantly, to build his business and his client base. So, Mark, I'd love to have you kind of weigh in on that and-
Mark Wilkins: Sure. Look, I think for all of us, there's a size component to it, and not too big, not too little. In my practice, we don't have billionaire clients and, frankly, we don't want billionaire clients, because we're not set up and structured to deal with them. But we're also not set up and structured to deal with retirees either.
Mark Wilkins: And so from a size perspective, I think that's important. Also, more than, more important I think is complexity. We found that we can deliver more value for clients that have complex situations. And then beyond that, and I think even more important than the complexity is simply the type of human being.
Mark Wilkins: And on our team, if a client and their family is really not focused on making the world a better place, they can't be our client. And that we just can't, and we're not going to be able to relate to that. It doesn't matter how much money they have or complexity, how much value we can add. If that's not a core part of their character and what they're trying to do.
Mark Wilkins: Now, making the world a better place is, I think of that as like ice cream. There are a lot of different flavors. We're not trying to pick the client’s flavor for them, but that general north star of doing that. And we find that to be incredibly important. Each team is going to have a different characteristic. Each enterprise is going to have different characteristics. For what they're going on, size, complexity, and then the type of human being.
Mark Wilkins: But I think having a well-defined, thought-out process and concept around that is important.
Michael Schweitzer: Mark, you just got back from a really interesting trip that you shared earlier, to South Africa, with a client on exactly that point. And you don't need to go into too many details, but I think it's a great representation of just how you apply that a successful individual, who wants to have an impact on the world in a positive way.
Michael Schweitzer: Would you be open to sharing just a little bit about that, about that experience because…
Mark Wilkins: Yeah.
Michael Schweitzer: ... a bunch of time off, number one, and that was great because your team was in place, but more importantly, you were sidecar with a client on impacting change. And I think that's a great way to resonate what you just talked about.
Mark Wilkins: Absolutely. This particular client’s interesting, a professional basketball player in the NBA. But their passion is really around clean water. And they invited me to go on a trip to Tanzania and to Kenya to look at their clean water projects. We did that and obviously, almost two weeks in a foreign country, a couple of foreign countries
Mark Wilkins: with the client, you're going to connect with them. But if you go back to [what] we talked about, what that optimal client is, it's not just about the size of the client. It's not just around the complexity of their situation, but it's about the type of human being. And this is clearly the type of human being that I want to be around, that I want to learn from, that I want to grow ….
Will McKenna: Wow. That's, those are great stories. Thank you for sharing that. And what a great example of focusing on those issues. You both use the term north star, and then, Mark, your focus on complexity, really interesting. You're actually going for complexity. And then as you said, the type of human being. So the, well beyond kind of their demographics, [it’s] really more about their attitude, their philosophy. Great stuff.
Will McKenna: Before we go to this next one, fun question from our audience for you, Michael. Are those Mark Takamichi Miller paintings behind you?
Michael Schweitzer: (laughs)
Will McKenna: Or, do you know?
Michael Schweitzer: I do know. They're Clemens Krauss, which is an Austrian artist, that we picked-
Will McKenna: OK.
Michael Schweitzer: ... up, a couple of years ago at our [inaudible 00:14:46]. So thank you UBS for that opportunity.
Will McKenna: Excellent. Excellent. Let's move on because I think the next issue here is the creating a clear value proposition statement. So, in addition to nailing down your optimal client, the best advisors have that really clear and compelling kind of brand statement. You're going to hear a great example, I think, from Mark in a minute, but Michael, talk about this. What are the steps that advisors can take to maybe refine what they already have on a value prop?
Michael Schweitzer: Sure. Value prop is a really interesting topic because it's the first thing after you got licensed that you learned about when you went through your sales training, and it's ironically, once you got your production number, the first thing you chucked out the window because you figured that you, we all figured that we knew what we're talking about and we had to go prospect and build the business.
Michael Schweitzer: But what's interesting is is we've gone upmarket as an industry, how important having a very strong and articulate value proposition is, one, because clients expect that. They want clarity. The world is complex, and they're looking for clarity and simplicity. Two, your competitors have realized that, and so they've gotten much better at it.
Michael Schweitzer: So, it's table stakes, and you need to be able to quickly and cleanly articulate what you do and how you do it, why you do it, who you do it for, and why what you do is better than what anyone else can do. And that's a tall order, but at the same time, it's critical to have something like that in place, so that you have the confidence, the ability to very quickly deliver that to a client or prospective client out of the gate.
Michael Schweitzer: Sometimes, your meetings get cut short, and all you have time for, when that call gets cut short, all you have time for, is to share that value proposition. And that is hopefully the hook that gets you a second meeting. So, things to think about are: What are the things that you and your team do that you feel are unique to how you serve clients and what you deliver to them?
Michael Schweitzer: It's not about tactical asset allocation. It's not about rebalancing. It's not about any of those things. When you think about what clients truly value, they value ensuring that their assets are on the right path, for the passions that they want to pursue throughout their life, particularly in the high net worth space.
Michael Schweitzer: And while there's never really a retirement age per se, it's a pivot from my full-time work lifestyle, maybe to pursuing their philanthropic passions or family governance and preparing the next generation. How do you do those things that bring value that clients rely on and value as their advisor. So, Mark, I know you've done a bunch here, why don't I pivot to you and you share some of your thoughts?
Mark Wilkins: Sure. I'm not sure I've ever said my value proposition out loud directly, specifically to a client. In many ways, I also think it's not just for the clients. It's for us as advisors and for our teams to be able to come back to and revisit and be like, to be part of that sort of that north star.
Mark Wilkins: But we think about our value proposition in terms of helping families, first of all, define the impact that they want to have, that they want their wealth to have — their wealth defined as their assets, plus their values. Helping them define what the impact they want their wealth to have both on their family and on the world, both during their lifetime and from a testamentary perspective.
Mark Wilkins: And then we want to help them execute towards that. So, starting with the defining what all of that is, and then helping them make that come to fruition. If we can do that, we're going to win more than we lose. And not only win more than we're losing, we're going to grow our practice. We're going to have successful families work with successful human beings and truly make the world a better place.
Will McKenna: That's awesome. And I think you get very specific around, you start with families, first of all. So that's a particular thing. And then you talk about that combination of wealth and values and impact on their family and on the world. So that paints a very compelling picture. One thing I want to mention to the audience, we've gotten a few questions about the slides.
Will McKenna: You should have the slides. If you look in the additional resources section of your player, they're there for you. Go ahead and open them up. You can download those and save them on your own computer. One thing I'll also plant the seed, we have a lot of resources on PracticeLab around working on your value proposition in your branding essentials.
Will McKenna: And I'll return to that later in the event, because I'm going to ask you to go to PracticeLab, but not yet while we're still talking. Let's go to number three, because this is an interesting pivot here to talk about knowing your strengths and weaknesses and those of your teammates. And so, it brings us to a key point of a successful practice, which is the people, not only you as leaders, but also your associates.
Will McKenna: Michael, how should advisors think about this and who they hire and what sorts of skills those folks should have?
Michael Schweitzer: Yeah. It's a great, another great question. The days of being everything to everyone are kind of long past. There's just too much going on, too much demand, too much complexity. You really have to dial in on what your passions are and what you love to do, where your genius and passion intersect.
Michael Schweitzer: That's not something I came up with. I know many of you have heard those statements before. But if you can find a way to spend 90% of your time of your day in that intersection of your genius and your passion, and then build a team around you that compliments those skill sets. And I'd say, it's easy to say that, but it's one of the most difficult things to actually implement.
Michael Schweitzer: Because we all have our own personal preferences and, as in, we're attracted to people like us. And so, in my experience, over the few decades I've been in the business, I've seen a lot of teams get built, and sometimes, unfortunately, unbuilt, because they bring together a lot of people with the exact same skillset, same passions, and they never quite get the leverage that they're looking for, and what they get is friction and conflict. And that's never a good thing.
Michael Schweitzer: So, you've really got to take the time to step back, and you got to think about what it is that you're great at, what you love doing. And if you can spend all your time doing that, then it becomes much clearer to understand the types of folks that you need to build around you. If you're a big-picture person that likes to build relationships and prospect, then you need more detail-oriented people around you that can tick and tie and take care of all the details.
Michael Schweitzer: And that's not a lesser job. That's an equally important job, because if you don't take care of those details, you don't have the clients sticking with you going forward. I know Mark [has] really put a lot of time in this, thinking about the team that he's built and the skillsets that he brought on to the team. And importantly, thinking about the culture of those teams and ensuring that you've got the right culture there, because you're working together many hours a day every day of the week.
Michael Schweitzer: You got to have to find people also that kind of jive together and really make one plus one equals three or two plus two equals five or six. So, with that, Mark-
Mark Wilkins: Yeah.
Michael Schweitzer: ... why don't you share some of your thoughts there.
Mark Wilkins: I actually take great pride in my team being, what I think of is one of the most diverse teams in the industry. But that diversity isn't about the way we might show up on a Zoom screen. And that's not what diversity is that we're looking for necessarily.
Mark Wilkins: It really is around diverse experiences, diverse skills sets and really diverse personalities. We've leaned, so for years, we've leaned pretty hard on Myers-Briggs, and just to under... So, each of us on the team understands ourselves. For example, I know that I'm 90, I'm great at the first 95% of any project almost, and incompetent about the last 5% of any project.
Mark Wilkins: And so I know that there has to, there have to be people on the team who can really carry the ball into the end zone and that last 5%. I know that that's not me. We also, doing Myers-Briggs a few years ago, realized that our team wasn't, didn't have a lot of feeling, weren't super sensitive, in fact, to the point that we recognize it as an absolute weakness.
Mark Wilkins: And so, as we continue to grow our team and build out our team, we've actually added senior people who, who, from a Myers-Brigg perspective have lots of feeling, have lots of sensitivity, and we found this to be important. And from a pure business standpoint, it's diversity of skills sets. On my trip to Africa, I ran across somebody, a very well-known, sort of faith leader in the United States that was on a trip to Africa.
Mark Wilkins: And I was actually able to talk to them, not about my experiences, but about that of my partner Drew, who truly lives faith, family and football. And we were able to, I was able to talk about that and talk about that as it related to Drew, and came back with a fantastic prospect, not because it was my skillset or my expertise, or my deep experience in life, but truly my partner’s and understanding that diversity, of skills set, of experience within our team. I think was really important on all sorts of different levels.
Will McKenna: Wow. So much good value in, in that discussion. Love this idea of the Venn diagram of your genius and passion. Michael, if you can spend time there and then build your team around that in terms of skills and culture, easier said than done, fair to say. And then Mark, as you point out, you've built a very diverse team, not just in race and gender, but in terms of experiences, skills sets, using a Myers-Briggs tool. And I'd ask the audience, put in the comments, are you using any of those kinds of, sort of personality assessment tools in your teams?
Will McKenna: And you found that, fair to say, you're good at getting it down to the five-yard line, but need help getting in the end zone, which can be the difficult last mile or last five yards, so to speak. And you found, you guys needed to kind of build up the feelings and the empathy in your business. So, love the transparency and the, sort of, the self-evaluation, self-awareness, really strong.
Will McKenna: Let us know what you think in the audience. We are going to actually ask you for a little interactivity right here, because we've got our first poll for you. The question is this: How would you describe where you are on the path to aligning your practice enterprise to your optimal client? The answer is A, I still need to define my optimal client; B, I've defined my optimal client, I am now aligning my practice; or C, I feel good that I've aligned my practice to my optimal client.
Will McKenna: And I would play the jeopardy theme song here if it didn't create a copyright problem for us, but imagine a little bit of that. Or sing along with Michael.
Michael Schweitzer: (laughs) You can't do more than six notes otherwise you'll get in trouble, right? Or-
Will McKenna: Yeah, it'll be a copyright strike for us, but I'm seeing the answers come back. If you guys could send those out to the audience, if we've given them enough time. It looks like A is in the lead here, closely followed by B. Can we put that up on the screen? It looks like it's hit an equilibrium here. About 42% chose A, I still need to define my optimal client, and about 40% chose B, I have defined them and I'm now aligning my practice. And only about 17% said they feel confident that they've got it nailed.
Will McKenna: So, some work to be done there. Thank you for that. Let's go ahead and, and jump back in because number four, I think is a very meaty topic. And that is this idea of standardizing your processes and measuring your progress against those goals. Michael, I know you've got a ton of passion for this one. This is a biggie, right? I mean, can
Michael Schweitzer: Yeah.
Will McKenna: ... you give us your perspective on the key issues here?
Michael Schweitzer: I mean, I call this the engine room of the business, right? This is really where everything kind of gets done. And this is your biggest opportunity to create process and discipline for a couple of reasons. One, because it removes friction and drags from your practice or from your enterprise. We use that frame, and [it] allows you to operate at a much more, kind of, targeted level. So that's number one.
Michael Schweitzer: Number two, and this is important. It creates consistency, right? So, you don't have people recreating the wheel, so to speak, every time. And when I talk about this kind of thing, I'm talking about your process on your team. Every firm has a way that they do wire transfers.
Michael Schweitzer: What is the way that you and your team effectuate client service activities against different types of things, whether it's a wire or … or whatever it might be, and how do you follow up and how do you confirm back to the client? You've got the firm standards, but now we're really talking about the client service aspect of it. And having really clearly defined processes for that allows you to drive a consistent process.
Michael Schweitzer: And then most importantly, and this is key, and the best teams do this religiously: It allows you to have a baseline for which to assess whether what you're doing is delivering the intended impact. Are you getting the right outcome, but for the wrong reasons, or are you getting a bad outcome for the right reasons?
Michael Schweitzer: It allows you to root cause analysis those things in an objective way. That then allows you to kind of reframe what you're doing, and get on a path for continuous improvement. And that for me is key. Whether that is how you bring on new clients and how you engineer their experience into online services and everything else and how they engage your team, to the other side of the equation, which is how do you offload clients when they no longer fit your profile?
Michael Schweitzer: Forty-two percent of you said on the poll that you have yet to align your optimal client. Well, I will share with you that as you go through [this] journey and you get to that point, there will become a point in time where you're going to have to make some hard decisions about the client set that you have and maybe move some of those clients to someone else that might be a better fit for them.
Michael Schweitzer: That's a tough process. You can't just wing it. You want to have a process that is respectful for the clients that you're moving on, and helps them understand why it will be a better outcome for them. And it has to be done in a way that eliminates or reduces the stress to you and your team for breaking some of those relationships. Some of them may be longstanding.
Michael Schweitzer: So, and it’s everything in between. The more that you can put discipline around that process, the better you will be at assessing how well you're doing and allowing your team to come through and look at things and say, ‘We could do this better if we just did this.’
Michael Schweitzer: And when you can get to that point, that's when you've got your team fully engaged. That's when you've got everybody aligned on the same path. And that's where you truly do see quantum growth and improvement in how you service clients. Mark, I know this has been an area that you guys have worked a lot on.
Michael Schweitzer: I think you mentioned to me, it's an area that you continually focused to try to improve on. There's areas that you're really good at. And there's some other areas where I know you're dialing up and making sure that you're doing what you need to do to, to improve that. So, let me hand it over to you for your thoughts.
Mark Wilkins: For me a lot of this goes back to being an army tank officer. And, we used to have battle drills. And, you can't just constantly recreate the wheel. There are so many things that you do over and over and over, even some pretty sophisticated high-level things. You do them over and over and over. And there's got to be some standardization.
Mark Wilkins: There's got to be some process. If you want to have any level of scaling that can go from an investment process, as you were, as you said to sending a wire, to all aspects of client service. I'm actually going to share a failure with you, of my team in the last quarter.
Mark Wilkins: We've gone through a lot of change. We're always trying to be able to double our practice every three years, which requires continuous change and continuous evolution. And one of the core basic things from our practices: how we set up each quarter, and how we set up client reviews, and when we set up client reviews in each quarter.
Mark Wilkins: And in the last quarter, what I realized too late, was that that process has gotten way too spread out. And we were doing quarterly reviews, not just in month one, or maybe a trickling into month two of a quarter, but all trickling into month three of a quarter. And I saw that, as a leader, I really attempt to be passionate, but pretty consistent and calm.
Mark Wilkins: I seldom become sort of apoplectic, and I became apoplectic over this in the last quarter. It was amazing how it threw off so many things, not only in how we run our practice or not how we run our enterprise, but how we run our lives, when people could take vacations and those sorts of things.
Mark Wilkins: And it was something we noticed when we got it back on track, but you’ve got to have a north star, and you’ve got to understand which way north is, on your team and all sorts of different areas of process in order to be able to course correct back to where you're trying to go.
Mark Wilkins: Look, our businesses are all sort of airplanes, and they're flying. Everybody on this Zoom has an airplane that's flying. But sometimes you do have to change an engine while it's … you can't land the plane, you’ve got to do it while it's in flight. So I say get as much altitude as you can and know the direction you're heading because turbulence will come along.
Will McKenna: What great examples, thank you both for that. And I just wanted to return to the prior question for a second because the audience, we saw a lot of good answers here for what they're using to assess their team. A lot of folks using the Kolbe System and also DiSC were the two that came through most consistently.
Will McKenna: So great to see a lot of people using that and having that in place. And then, wow, this one very important key engine room as you call it, Michael, I love how you talked about creating that path to continuous improvement. I love this phrase you used: quantum growth and improvement. That's where you can really build that.
Will McKenna: And then Mark, you learned this being an Army tank captain, that those drills that you do, that repetition is key and fair to say the stakes are high in that kind of a setting. And then, thank you for sharing an example of where it's not going well. And you guys have some work to do to meet those high standards. So, great stuff.
Will McKenna: And I think a related topic here, as we turn to number five, now that you have your process in place, you've got a team with complimentary skillset. Now it's time to determine everybody's specific responsibilities. Michael, kick us off as usual, and then Mark can jump in and talk about how he approaches this at his firm.
Michael Schweitzer: Sure. And this is where there's a lot of conversation about this in the sense that, some smaller teams, you have to have wider remits, larger teams, you can get more specialized, and it's not static. It shifts over time. The team that has 20 or 30 people on it will have very narrowly defined roles and responsibilities because they have the ability to do that.
Michael Schweitzer: If you have a smaller team, you probably have to widen that remit a little bit. What you have to be really careful about is that you don't throw the kitchen sink into everybody's role. Everybody can't do everything. And one of the things that I've learned in my time in the industry is, you can be really good at three or five things in a year. You really need to be focused if you really want to have exceptional performance.
Michael Schweitzer: The notion that you can give people 86 different things and measure them on it just doesn't really fly. And so, having really clearly defined roles and responsibilities for the people on your team: What's expected of them? What does good look like? How does that correspond or connect to compensation, right?
Michael Schweitzer: You don't want to have people do a bunch of work all year long, and then the compensation conversation is completely disconnected from the work they did. They need to understand if I do these things really, really well, this is the result that I should see on the other end. And the more clarity that you can put around that, the more loyalty and continuity that you're going to have on the team.
Michael Schweitzer: One of the things that came out as a result of the pandemic is some studies around employee satisfaction. And while there's a bunch of different information out there, one particular study said that it's expected that 61% of employees are looking to resign from their current role to pursue something else.
Michael Schweitzer: Some [are] moving to more passion-oriented roles, but it's really had an impact on how people think about the quality of their lives. If that is anywhere near accurate, then we all have a very large challenge, and we need to get on top of that and really address it. And doing things like this, to really put that clarity in there, and put purpose around it, is what's going to be the differentiator between having a team that's with you for the long haul or having to continually train new people.
Michael Schweitzer: And one of the things that's really kind of come out over the years, as I've looked and worked with many of the top teams out there, is just how long and how loyal the people on their team are. When you talk to the top teams in history, you will see that the people on those teams have been with them, in some cases, 25, 30 years.
Michael Schweitzer: They've built that kind of loyalty. They've built that kind of sharing and connectivity and culture that keeps people engaged. And that's because they value what they do, and they really do keep their roles clearly defined, so that there's not a lot of ambiguity in them.
Michael Schweitzer: Mark, I know you've actually done some really interesting things with your team, and one of your senior folks who started with you early on and actually went through a pretty good transition. I think that'd be a great example to share.
Mark Wilkins: Yeah. I think that, as leaders of teams, we need to not only see people as they are today, today, and think about roles and responsibilities for today, but it's also critical to think about, well, how's this person going to grow and how are they going to grow professionally in the context of the team?
Mark Wilkins: Because I think we all understand the turnover is terrible. It's something that, as leaders, we really, really want to avoid if possible. My partner was once the junior analyst on my team. My COO replaced him as junior analyst as my partner moved up a bit many, many years ago.
Mark Wilkins: So I do think that it's important to not only have defined roles and responsibilities, but to really take it to the next step and, and see people as they may be able to become down the road and talk about career paths, in terms of roles and responsibilities, not just for today, but well down the road.
Will McKenna: That's outstanding. And I just want to reference a couple of comments here from our audience. Here's one from Jeff: ‘Thanks for sharing a failure, Mark. I feel like we always have success, and last month we had a failure. Loved having you share one, too. Thanks for that.’ So, good stuff there. And I just want to push ahead because I think number six is related to what you guys were both talking about, which is inspect what you expect.
Will McKenna: And if I know Michael Schweitzer, he uses that phrase all the time. Michael, what do you mean by this one?
Michael Schweitzer: Yeah, I mean, I learned this early on from one of the senior leaders that I worked with in my first management role. And simply put, if you don't measure it, you can't manage it. You don't know if you're doing a good job with it. And that goes back to kind of the engine room comment earlier. You need that foundation in place, and that structure, to be able to put measurement around things.
Michael Schweitzer: What are your goals and objectives, and are you measuring against them? And how did you do versus those objectives? That's the first level of question. The second-level question is: Did we get the expected outcome based on what we did? Because too often we look and we say, ‘Oh, check the box. We got the client assets.’
Michael Schweitzer: And while the client assets could have come as a result of something completely out of your control. It could have happened without your engagement. It could have been market movement, could have been a number of things. And if we don't ask that second question, which is, how did it happen? Why did it happen? Is it the result of things that we're doing to make it happen? Then we never really can understand what's going on in our business.
Michael Schweitzer: So, inspect what you expect is a critical, critical comment, but it's not just the top level of did we meet our [benchmark], or miss an a objective. You have to ask that next-level question which is, why or how did it happen, and is it, did it happen because of what we did or didn't do?
Michael Schweitzer: And that will allow you to root cause, and really get at the core things and help you understand how your business is operating.
Mark Wilkins: [inaudible 00:41:20] yeah. What I really think we're talking about here is a lot about intentionality and-
Michael Schweitzer: Yeah.
Mark Wilkins: ... about how you arrive at results and really being critical, hypercritical in many cases, about how you arrive at results. Spot-checking on all the processes that we've talked about. You can lay out all the best processes, but as a leader, if you're not stopping to occasionally, not every day, but occasionally, check in and spot-check, you're probably not doing enough.
Mark Wilkins: And again, like the failure that I talked before, that's on me. I also come from the military background of everything that happens in your command or fails to happen in your command is [your] responsibility. And so, my team being off, for example, as we talked about on the client reporting, that's on me.
Mark Wilkins: So that was really my failure to spot-check. It really does go back to the importance of doing it, and being intentional about it.
Will McKenna: That's [crosstalk 00:42:20]-
Michael Schweitzer: There's a great book I'd recommend to people. It's called Flawless Execution.
Will McKenna: Mm.
Michael Schweitzer: And it's actually a book written by a former pilot, Navy pilot. And it talks about the debrief process of how every time the Blue Angels or any kind of story takes place, what happens post-activity. There's a really deep debrief with root-cause analysis to understand the whys and hows of what happened, and then importantly, they build a library of learning off the back of that, so that the next time they do it, they have an incremental improvement.
Michael Schweitzer: So if you're interested in this kind of thing, I highly recommend you go have a read of that book. It's a quick read. It's fantastic, and you'll get a sense of exactly what we're talking about.
Will McKenna: That's great. Thank you, Michael. And reminds me, too, of some of the content we have on PracticeLab, from a Navy seal who now works at Capital Group-
Michael Schweitzer: Yeah.
Will McKenna: ... talking about that after-action review and, and some of the learnings; they are great stuff. Also, want to thank our audience. So many good questions have come in. We're not going to get to all of them, but suffice to say your Capital Group team will connect with you on some of those. When I look at number seven, Michael, admittedly, I was scratching my head a little bit.
Michael Schweitzer: Yeah.
Will McKenna: Especially coming from an investment manager like Capital, American Funds. But, tell us, what do you mean when you say get out of the business of managing money?
Michael Schweitzer: Yeah.
Will McKenna: Isn't that what advisors do or … well, help us understand it.
Michael Schweitzer: Well, this is a little bit of a play on words, but … we of course have to manage money either as an asset manager or as a financial advisor. But what I'm really getting at is that, that's not your value proposition. That's not what you spend your day doing. You spend your day building, managing and deepening relationships with existing clients or prospective clients.
Michael Schweitzer: The clients aren't spending their time thinking through the intricacies of their portfolio. They're thinking about the challenges of their life. And so, when I talk about getting out of the business of managing money, I'm really talking about that. Not leading with that. Really building processes again, just to kind of borrow from our earlier part of the conversation, building processes for how you select and find managers.
Michael Schweitzer: How you build portfolios. And then how you alter them to fit a variety of client risk profiles and objectives. If you do that, that's a really powerful way and allows you to step out of, kind of the spider web of being locked to your screens all day long, looking at the markets and paying attention. Top advisors that I speak with today oftentimes will tell me, ‘I can't actually tell you the details of our portfolio because my CIO portion of my team really handles that.
Michael Schweitzer: I'm focused on relationship building. Everyone else is really focused on other aspects of the business.’ So, when I talk about that, that's what I'm really talking about. Put those systems in place to, like, step away from that daily lock into the green screen, so to speak. Mark, I know you guys have really done a great job here. That'd be great for you to share your thoughts.
Mark Wilkins: Sure. I think that, look, everybody's going to have their own unique flavor of how they do managing money. I come from the perspective, I think a lot like yours, Michael, that at this level of client that everybody on this call is talking about actually, capital markets expertise is ... the assumption of that is a given.
Mark Wilkins: Being up to date on current events is a given. But I really believe that this special sauce is around linking capital markets and capital market potential outcomes to what does the client and their family really trying to achieve to be a successful family.
Mark Wilkins: It's about linking those things back. And if you spend all your time into minutiae of the capital markets and not enough ... As an industry, I believe we tend to do that at varying levels from different practitioners in different teams. But I do think if you forget to link it back to what is a family really trying to accomplish, then we're missing something and really not optimizing.
Mark Wilkins: Either optimizing for the client or optimizing for our practice and our ability to have the bandwidth to grow.
Will McKenna: Yeah, that's great and I wanted to just pick up on a couple of questions came in. It's Flawless Execution. I think it's James Murphy; he's the author.
Michael Schweitzer: It's James Murphy.
Will McKenna: Yeah.
Michael Schweitzer: That's correct. Yep.
Will McKenna: So Flawless Execution, if we see a spike in Amazon sales, they need to give you guys an affiliate
Michael Schweitzer: (laughs)
Will McKenna: ... piece of that. Let's move on just in the interest of some time.
Michael Schweitzer: Yeah.
Will McKenna: I want to keep plowing ahead. I will mention there's a great tie to our advisor benchmark report around that whole idea of using model portfolios to help you achieve scale. I'll repeat that at the end. It's all in PracticeLab. Focusing on outcomes is number eight. Michael, in brief, what do you mean by that?
Michael Schweitzer: Yeah. I mean, just what it basically says. It's really on client outcomes. So, I say outcomes, but it's really client outcomes that we're really focused on. The industry is moving as we all know, Reg BI, DOL, all of these shifts are pushing us towards a fiduciary orientation. We're not there all, clearly, but you can see the underpinnings of that.
Michael Schweitzer: And what that really means is that there's going to be a higher level of accountability around delivering client outcomes. You know? Client outcomes that they expect, not just results. Right? It's actually results that deliver the outcome that the client expects. And that's really what I'm talking about there.
Michael Schweitzer: And when we talked about that, we talk about understanding. The great advisors understand how value is created, where their time is spent, versus where value is created. And that's always a pretty interesting disconnect. It's a little bit like when you go on a diet and they tell you to write down everything you're eating before you go on the diet so you can kind of get a full accounting of what you're doing.
Michael Schweitzer: I always urge advisors to write down throughout the day, what are they doing at different points in the day, every 15 minutes? What are you doing at that point in time? Look at that mosaic over a week and get a sense of whether how you're spending your time based on that is the truest and highest best use of your time. Because at the end of the day, our job is to deliver client outcomes.
Michael Schweitzer: And if we're not doing that, anything else we're spending our time on is really not optimal. So that's how I think about that. And it's really about driving efficiency, so that you can be, you can create more time and space for deepening, broadening and developing client relationships. Mark, I know this has been very, you've done a fantastic job and obviously, it would be great to hear your thoughts.
Mark Wilkins: I think of it, as a career, as an advisor, that there's an art and a science. And I think depending on whether we're left brain or right brain, we tend to go, as advisors, we tend to go probably too far in one direction based on our own personality. But I do think measuring the client outcomes in both is really, really important.
Mark Wilkins: And so, from the science standpoint, that is, do we have portfolios and investments that are being defined. And I think they're important operatives where there's defined client goals and objectives. So step number one is to define the outcome that you're looking for with that client.
Mark Wilkins: And then on the art side, this tends to be a little more touchy-feely, but is the family moving towards being successful, not just a prosperous, but a successful family? And as much as you can define that and help the family define that and help them move towards that, I think the better off you are. I think as, again, as advisers, none of us are perfect and none of us can do everything.
Mark Wilkins: I think we do try, and those of us who are more interested in the science of it pigeonhole ourselves that way. And those of us who are more excited about the art aspect of it pigeonhole ourselves that way. I think it requires a holistic approach, but outcomes from both is our insights perspective.
Will McKenna: That's dynamite, and I do like how both of you use a framework there. From Michael, it's time spent versus value created. And make sure you're kind of keeping your eye on that. And for you, Mark, it's art and science and finding that right balance. Just being conscious of time, let's forge ahead to number nine, because I know this is an important one to talk about career paths on your team and to share the economics, share the rewards. Michael, fill us in on this one.
Michael Schweitzer: Sure. I mean, we talked earlier about the war for talent. I think that's kind of a theme that's come through here. And when you think about that, and the fact that 61% of people out there today are talking about this notion of resigning and looking for other employment, they're not fulfilled.
Michael Schweitzer: Either they're not fulfilled in their role, or they don't feel that they're appreciated, or it's a combination of both of those things. And so, we need to think long and hard about that. Nobody can do it all; it takes a team. And we all know advisors that haven't shared economics with those teams, and honestly, in my experience as a manager, they're usually the target, kind of the target-rich environments for advisors who do.
Michael Schweitzer: And I've seen that time and time again in my industry. So, you need to think about bringing people on your team that are either income or equity partners. And there's so much flexibility with firms today on how you compensate your staff. So, from that perspective, I would urge you to think in that context, giving up some here to bring people along goes a long way in developing that team.
Michael Schweitzer: And Mark, I know you've done a lot here with how you've developed your team over the years.
Mark Wilkins: Yeah. I think there's a component of it that's certainly comp. And my view is, without getting into the minutiae of, everybody's got a different situation, but don't be greedy. As a leader of a team, just don't be greedy. Share, and that will help you grow. And then I think also very importantly is the concept of the compensation through providing meaningful, impactful work.
Mark Wilkins: And so, the members of my team, if I'm positive that it … them coming to work and recognizing that they were helping families, their clients make the world a better place, and focusing on impact, both philanthropic and for profit impact … I'm very confident come to work every day, excited about that.
Mark Wilkins: And here we've recruited a high-level talent from a family office, a competing family office in St. Louis. And she came not just for compensation. She came because she was going to have more meaningful work on our team. And I think that that's something that we can all step back and continue to assess, not just the dollar compensation, but are we providing meaningful work to the members of our teams?
Will McKenna: That's fantastic. And I love your framework of talking about, ‘Hey, don't be greedy.’ So, kind of the opposite of the Gordon Gekko approach, right Mark? From the ‘80s. if people know that reference. And then, your point about meaningful, impactful work, being such a big part of it as well as compensation. So those two things go together.
Will McKenna: Turning the corner, coming toward the end here. Let's go ahead and go to number 10. And that is, sounds very simple, but Michael, why did this make the top 10: Never stop learning?
Michael Schweitzer: Well, it's a great way to kind of wrap the top 10, because this is not a static thing. This is not a one-time thing. This is an evolution; it's a journey. You need to be in a position to kind of retest the hypotheses that you put in building your business from the outset. So it's important to not look at this just as a ‘I got it done and now I can go on and, and do what I do.’ You need to continually learn and evolve.
Michael Schweitzer: And that means you’ve got to operate in what I call the art of the possible. It's frankly a lot more fun to live and work that way than any other way. And you want to share learnings with your team. I know some of the best teams out there, when the senior partners come back, the first thing they do is they download what they learned at a conference or an event or a client, [in an] activity or something like that to help the entire team get better, so that they're more engaged, more involved, more informed, and can actually deliver a better outcome to clients.
Michael Schweitzer: And that will give you the freedom as the lead advisor to do the things that interest you. So, never stop learning, operating in the art of the possible is just a great way to go through life, and allows you to put that culture in place for continuous improvement each and every day that you operate your business.
Will McKenna: Fantastic.
Mark Wilkins: To add onto that, I would talk about the importance of learning, not just from sort of industry perspectives like this, but actually getting out of our industry and learning from people in other businesses. I think technology is a fantastic one. If you really want to learn about and think about scaling your practice, go to technology, go to the technology industry and learn from some experts there.
Mark Wilkins: And also, academia. Some of the absolute, not some of, the absolute best learning I've done in my career has been doing executive education classes at top business schools. And not specifically around the markets. My daughter went to Dartmouth, and I spent, so I ended up going to the Tuck business school there for a few years for executive education, and learning about how to run an innovation project.
Mark Wilkins: But my partner and I talked about that literally this morning, about how we're doubling and tripling down on our ideal client within sort of exit planning traditional type businesses. Three or four years ago, we put in an innovation project around technology, sort of tech-enabled impact companies, more Silicon Valley-type things.
Mark Wilkins: That's coming to fruition, and now around athletes and entertainers, which is still very much in its infancy and an innovation project. But I've learned the thought process and then the execution, and also the (importantly) the measurement of an innovation project not from our industry. Very much outside of our industry and going back to academia.
Mark Wilkins: And so, I've really challenged people to step back from what we're doing and learn about our business from others in other industries or academia.
Will McKenna: Such a good example, and this idea of being kind of interdisciplinary, Mark, and not just focusing on our business, but learning — it's pretty nice to go to Dartmouth and be able to hang out with your daughter and spend a little time there —but that sounds pretty, pretty great.
Mark Wilkins: One of us loved it. (laughs)
Will McKenna: Yeah, that's great. (laughing) Just being conscious of time, I think we had a quick summary slide. I may just kind of skip over that. Great content today. Great discussion. I do want to leave all of you in the audience with a couple of calls to action, and if we could put PracticeLab up on the screen, I want to leave everybody with two calls to action.
Will McKenna: First of all, thanks again for all the great engagement and the questions that you've put in to the comment box. Two actions for you: Number one, please go to PracticeLab, check out all the resources you have there to help you grow your business and engage with clients.
Will McKenna: You'll find Michael's article on the 10 traits that we just went through, and he's part of a podcast there and more. So, if you just go to PracticeLab.com, you'll find that I think you'll be surprised at how much good stuff is there. And then number two, I would ask you to reach out to your Capital Group team and really talk to them about how we can help you implement the 10 traits we talked about today, or some of them.
Will McKenna: Again, you may be surprised by all the resources your Capital team has and can bring to bear to help you build your practice. So, that's all the time we have today folks. Loved the discussion. You two guys were great. Big thanks to Michael and Mark for a great discussion. Hope you in the audience found it helpful. Don't forget to take advantage of what's in the additional resources.
Will McKenna: Go to PracticeLab; talk to Capital Group team. I want to thank you, and enjoy the rest of your day. Thank you so much.
1 hr.: CE credit
Like athletes who use training rituals to ensure peak performance, there are strategies that can help advisory teams build robust practices with staying power. Capital Group's Head of High Net Worth Michael Schweitzer and Mark Wilkins of UBS Private Wealth share 10 traits that they have seen help transform teams into top-performing enterprises that operate like successful corporations and create lasting value. They will also share tips and examples of how you can embed those traits into your solo or team practice.
What you’ll get:
- Tips to create an optimal client definition and alignment framework
- How to transform your value proposition into a marketing statement
- Ideas on building a robust, operational “engine room” through standardization
- Insight to establish principles to build high-functioning teams
Who can benefit:
- Solo practitioners and teams seeking to drive scale and build sustainable, consistent growth
Watch on demand for one hour of CE credit for CFP and CIMA designations. Take the CE credit quiz.
Michael Schweitzer is a director of distribution for High Net Worth at Capital Group, home of American Funds. He has 32 years of industry experience and has been with Capital Group for four years. Prior to joining Capital, Michael worked as global head of sales and distribution at HSBC. Before that, he held a variety of senior roles focused on building and leading UHNW businesses as a managing director at UBS and Merrill Lynch. He holds a bachelor's degree in business administration from San Diego State University. Michael is based in Los Angeles.
Mark Wilkins joined UBS Private Wealth Management in 2015, following 21 years at Merrill Lynch. Prior to becoming a private wealth advisor he served as an officer in the United States Army. Mark is very active in several military and educational causes. He is a founder and board member of the Second Ranger Battalion Assistance Foundation. In 2005, he founded the Mark and Patrick Wilkins Army ROTC Fund at the University of Missouri, his alma mater. Mark currently serves on the Strategic Development Board for the College of Arts and Science, and the Mizzou: Our Time to Lead National Campaign Cabinet. Mark is also an avid mountain climber, having undertaken many domestic and international expeditions, including Mt. Everest in Nepal, Mt. Vinson in Antarctica and Mt. McKinley in Alaska.