by Joni Youngwirth
The larger and more sophisticated your business is, the more important artful delegation becomes to its continued success. As your book of clients grows and your practice morphs into a bona fide business, time becomes increasingly precious. Successful advisers focus on responsibilities that reflect the optimal use of their time and passion, and delegate the rest.
Delegation in Real Time
Let's start with a quick review of guidelines for good delegation:
Delegate to the right person. Delegation success depends on both the person delegating and the person delegated to. Does the person to whom you're delegating possess the necessary ability, experience and motivation to complete the task? Assess the probability of success. If any of those qualities are missing, you may need to adjust your expectations or find a more suitable candidate for the job.
Set expectations. When you delegate a task, project or responsibility, be specific about the deliverable you expect. Don't assume that the person to whom you're delegating understands your expectations-be explicit.
Provide training. There's a correlation between the time and energy you put into training someone and the results you get in return. Depending on the task, the person to whom you delegate a project might not get it right the first time, and that's OK. It may just mean that he or she needs additional training.
Offer constructive feedback. With the person you're delegating to, decide how frequently you'll check in on progress. And when you do, be straightforward and offer helpful suggestions. Encouragement is especially important early in the delegation of a new responsibility. As the employee's ability and experience increase, you'll need to check in less frequently.
Let go! Once a responsibility has been successfully assumed, focus on redeploying your time to your own high-level work. Be available to answer questions as needed, but give the employee or colleague space to handle the new responsibility independently.
From Theory to Practice
These guidelines may seem simple until you apply them to real-life situations. The following four examples demonstrate delegation of increasingly complex responsibilities to a current or new employee or colleague. For each example, we'll focus on assessing the probability of success based on the ability, experience and motivation of the person delegated to.
Example 1: Delegating to an assistant. Once their revenue stream allows it, most advisers are eager to hire an assistant to schedule appointments, complete paperwork and coordinate myriad office details, from ordering paper supplies to greeting clients. You interview an assistant candidate whose responses to your questions are specific and convey her knowledge and competence. Her glowing references validate her superior work performance for five years in a similar office. Another employee who participated in the interview process agrees that the candidate appears to be an excellent fit and eager to contribute to your firm's success. You decide to offer her the position, and she accepts. Naturally, since every office operates a bit differently, you provide the new assistant with training in the firm's specific procedures and policies.
Prognosis: Excellent. Not only does the new assistant possess the requisite ability and experience, she is highly motivated to do the job. By delegating this role to her, the adviser will be able to redeploy his time to more $1,000/hour work.
Example 2: Delegating to a paraplanner or customer service representative. In order to spend your time on more challenging activities, you decide you need a paraplanner to help you enter data into the financial planning software, prepare for review meetings and execute trades. The person you have in mind has been an assistant at your firm for five years and is highly motivated to take on more responsibility. To execute trades and assume other duties of the paraplanner position, however, the individual must obtain a Series 7 registration. Although you're fairly confident that he'll pass the Series 7 exam, you hold off on offering him the position; his performance on the exam will determine whether or not he can carry out all of the duties you plan to delegate to him.
Prognosis: Good. You're familiar with the employee's experience and motivation, both of which point to success in the paraplanner role. But since the position requires an S7, it's best to have the individual pass the test first. If you offer him the position now and he fails the exam, you'll end up with an employee who can perform some-but not all-of the functions you want to delegate, saving you only a fraction of the time you envisioned.
Example 3: Delegating to a junior adviser. Your book of clients has grown over the years and you increasingly find yourself stretched for time. You also realize that certain clients might not need the sophisticated service you now provide to your wealth management clients. So you decide to transition some of your "easier" clients to a junior adviser. You're looking for a junior who will be able to replicate both your relationship-building and your business-development skills, and your intent is to make part of the junior adviser's compensation dependent on his or her own production. You have been introduced to a junior adviser who recently passed the CFP exam and is looking for a position in an adviser's office to fulfill her experience requirements. Based on your interviews, she is affable and intelligent, as well as exceedingly motivated.
Prognosis: Uncertain. Success depends on the junior adviser's ability to apply textbook knowledge to the reality of working with clients, something that has taken you decades to perfect. Business development could present a challenge, as the junior candidate's rainmaking skills are a complete unknown. Remember, there is no shortcut to experience. Two key determinants of success will be the adviser's patience in mentoring the junior over a period of years, and the junior's ability to learn fast.
Example 4: Delegating to an office manager, VP of operations or COO. Like many other advisers, you love the financial adviser role and the relationships you have with clients. But you dislike all the other "stuff" required to run a business. You realize that if you want to spend most of your time with clients, you'll need to delegate responsibility for handling other aspects of the business. The management responsibilities you decide to delegate depend on you and your practice. If you're a solo adviser, you may want to hire an office manager to order supplies, manage the other employees' work schedules and conduct their performance reviews. If you're in a multiple-adviser office with one or more locations, you may decide to hire a VP of operations or COO to assume such responsibilities as researching and procuring new technology; securing office space and renewing leases; creating and implementing standardized procedures and policies; working with vendors; executing branding and other marketing campaigns; overseeing bill payment; and tracking office profitability.
Prognosis: Up in the air. The more sophisticated the role, the more difficult it can be to find a candidate with the necessary ability, experience and motivation. Success also depends on you, the adviser (or adviser partners), accepting that you lack the abilities, experience or motivation to perform these roles and ceding control of some high-level business decisions.
Back to Basics
No matter how simple or complex the situation, the basics of good delegation always apply. The right person for the job will have the ability, experience and motivation to do it well. The presence of all three in a significant degree enhances the probability of delegation success. And once you find the right person, don't neglect to set expectations, provide training as needed and share feedback. Finally, delegation simply doesn't work if you don't let go and challenge yourself to take on new roles. It's understandable that when you've worked tirelessly to build your firm, giving up the reins in some areas can be difficult, even painful. But taking your firm's profitability to the next level may require doing just that.
Joni Youngwirth is the managing principal of practice management at Commonwealth Financial Network®, Member FINRA/SIPC, a registered investment adviser in Waltham, Mass. She can be reached at firstname.lastname@example.org.