Road To Independence

I recall my training from years ago. I was instructed to meet the client when they arrived, look them in the eye, shake their hand, turn around, and begin walking back to my desk. The client would simply follow as I took the lead. After all, I was the professional and they were the uninformed clients being led to investopia. “Why, even a newly minted broker knows more than 90% of the clients,” I was told. What I wasn’t aware of at the time, or chose to ignore, was the sales culture so prevalent there. All I heard was how much broker Bob made or how well broker Jane was doing. The focus was on sales, hitting the numbers, making your goals, and most important, cashing your check.

There’s nothing wrong with making a good living or even becoming extremely successful. I do have a problem with the way it’s often accomplished.
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I have a client who has a strong desire to open a retail business. According to Michael Gerber, author of the E-Myth books, many business owners were once employees who thought they could do it better if they were on their own. He argues that there are three main “hats” a successful business owner must wear. The first is the hat of a technician, and most who venture out on their own wear that hat comfortably since they are skilled at their particular craft. The second hat is that of a manager. They have to be able to manage the inventory, people, processes, etc. The third and perhaps the most important hat is that of an entrepreneur. This role requires someone who can see the big picture and steer the ship.
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In the course of our lives we are forced to make a variety of decisions. We will make these decisions from our own personal perspective of right and wrong. In our industry we face choices on a daily basis. These decisions have the effect of creating an image in the eyes of the public. Too often, this image is less than honorable and demeans our profession. If from the preceding you sense that I’m an idealist, you’re correct, but I’m also a realist. Let me share what I believe to be a significant cause of our problem.

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This past week I spoke at a conference in North Carolina sponsored by fi360, a firm dedicated to serving the fiduciary market, and most of the attendees were registered investment advisors. There were also several brokers present. One particular broker I spoke with was preparing to leave his company and become an RIA. There was a consistent theme echoed from many brokers. They told me about the ridiculous rules and decisions their companies had made and how it’s had a negative effect on their ability to do their job. There seems to be an exodus occurring in the wirehouses.

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This week I travel to North Carolina to speak at a national conference for Fiduciary 360, a company based in Pittsburgh that is dedicated to serving the fiduciary community. I’ll be speaking during two breakout sessions. The topic of the first session is “Comparing Broker Dealers and RIAs.” The other session is a panel discussing the relationship between the media and the advisor. The trip will also provide a much needed break for me, I admit.
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