Having moved away from large bureaucratic institutions that “reach for the lowest common denominator”, many RIA owners are reluctant to create systems and processes because they feel that by doing so, they will limit the “uniqueness” they have worked so hard for. many to create by starting their own. Ironically, it is this same passion for uniqueness that allows them to grow their business to new heights. They wake up one day with more customers and more employees than they could ever imagine. Eventually, however, they feel hampered by this uniqueness, as they find themselves asking employees to treat each customer differently and constantly reinventing the wheel with each new customer that comes on board. Despite their mental issues around creating discipline and defined systems, the firm will eventually need to create a process in order to grow.
Appearing in a recent episode of The COO Roundtable Podcast, Adrian Chastain of Gratus Capital said, “The process is not meant to be scary or rigid; it's not meant to take away creativity.” As I wrote before, without a documented process that details, “This is how we do things around here,” new employees are forced to learn by trial and error and guess how best to execute standard processes. In the same episode of the podcast, Kailee Ostroski of Connecticut Wealth Management commented, “The three things I think of when I think of processes are efficiency, accuracy and repeatability.” She sees “process” as nothing more than a checklist of steps needed to complete a task. “I really found that those checklists were so integral to my success and helped me make sure I knew what I needed to do,” she said. “I didn't miss anything (in the process) because I wasn't relying on my memory every time I wanted to compete a certain task.”
As a firm grows and more employees come on board to serve more clients, it becomes important that everyone performs tasks in a similar manner. “When you have team members doing things their way, it can create a very bad customer experience,” Chastain said. “Of course, there will be certain situations where you have to cheat and do something different, but if you have team members who consistently do things the same way, it serves as a great customer service audit if something goes wrong ,” because the auditor can see where an employee has deviated from the standard set by the firm. Again, the process leads to efficiency, accuracy and repeatability within your organization. “Over time, these steps become much more than a simple checklist—they become a roadmap for how we provide our customers with the best experience and how we do our best work,” added Ostraski.
It is important to involve the team members who will be charged with the execution of these tasks in the creation and ongoing revisions of these processes. Chastain explained that at Gratus Capital, “We have Friday huddles between our customer experience team and our operations team—topic no. 1 of those meetings are our standard processes. You must constantly be on top of the processes you have in place and seek to improve them. It's also important that everyone understands the process – yes, it's a checklist, but really to understand why a specific task is part of the process.” Ostraski added, “Obviously, you just start looking at the checklist and say, 'Oh, what if we add this? Or, what if we fixed it? What if we took this step first instead of the third?' I just see the processes as a way to do good work without making mistakes and help teach other team members how to do the same and build their confidence very early in their career.”
When the firm has only one or two client service associates who touch every task throughout the practice, institutional knowledge is not as critical. But as the client list grows and you need to hire four or more CSAs, the process is no longer a “nice to have” but a “must have.” The processes in place will ensure that every customer – regardless of which team member is performing the tasks – will have a consistent experience. As Ostroski said on the podcast, “The more collaboration and cross-pollination you have between teammates, the more important it is that people do things similarly. Having a team that can jump in and out to different advisors or customer service people because they're following the same processes, which … leads to a better experience for everyone involved.”
While the passion for uniqueness may lead RIA owners to resist implementation systems and processes, it eventually becomes necessary for growth and scaling. Standardized processes ensure a consistent customer experience and provide a framework for employees to deliver their best work. Simply put, the firm cannot grow without them. As Ostroski concluded on the podcast, “There's no question for me personally that having those strong processes and having people committed to what it means to follow a process and the success that comes with it is really, really helpful in a firm growing and allowing people to feel good about their daily work.”
Matt Sonnen is Chief Operating Officer at Coldstream Wealth Managementas well as the creator of the digital consulting platform COO Society, which educates RIA owners and operations professionals on how to build more impactful and profitable enterprises. He is also the host of the popular The COO Roundtable Podcast.