Australian NEWSLETTER OCTOBER 2017
>> BENCHMARKS DO MATTER …SO WHAT’S THE BENCHMARK?
>> STATS & FACTS THE LATEST FROM FUTURE READY VII
>> TOP TIPS FOR BENCHMARKING YOUR PRACTICE LIES, DAMN LIES & STATISTICS?
>> THE BENCHMARKER A NEW TOOL FOR AUSTRALIAN PRACTICES
>> NOW THAT’S WHAT I’M TALKING ABOUT THE THINGS CLIENTS SAY
>> WHY CLIENTS TERMINATE THEIR ADVISER NEW RESEARCH FROM THE US
>> YOUR SAY SEND US YOUR AH-HAH!s
>> CONTACT US
Benchmarks do matter
…SO WHAT’S THE BENCHMARK?
Practices differ – we get that. Whether it is due to size, location, licensee, business cycle, market niche, age, network or anything else, businesses will simply be managed differently. But throughout all the work we’ve done with practices both here and overseas, there are a number of key metrics which seem to us to provide good insight into how “healthy’ a practice is today and how ‘fit’ it could become if the owner so chooses.
The following have been taken from our recently released Future Ready VII Report.†
† Consolidated data taken from 226 Australian practices that completed Business Health’s HealthCheck diagnostic during 2015/6. These practices are comprised of aligned/non-aligned, city/regional, large/small as well as ‘better’ practices who have been participants in various licensee ‘premier practitioner’ programs or were entrants in best practice competitions.
LIES, DAMN LIES AND STATISTICS?
Top tips for benchmarking your business
Notwithstanding the previous commentary, we also acknowledge the statement popularised by Mark Twain “lies, damned lies and statistics”. So, to help put your own benchmarking results into the right context, you may like to consider our top benchmarking tips:
1. Quality of information
Make sure the database against which you’re seeking to benchmark your practice consists of accurate, timely and ‘real’ information. Does the phrase, “Garbage in equals garbage out” ring any bells?
2. Benchmarking in isolation
One of the major problems with benchmarking is looking at any metric in isolation – numbers in a vacuum are very dangerous! Drawing accurate conclusions purely from financial benchmarking can sometimes be very difficult. It’s important to compare like with like as much as possible.
For example, a practice gearing for significant growth and keen to employ the best available talent may well be investing significantly more in staff salaries than the marketplace average. In this case, the fact that they have fallen outside of the industry benchmark is probably a positive.
3. Qualitative versus quantitative
While they are extremely important, in the end, the numbers (quantitative) are the “lag” indicators – they are the result of strategies and actions. To get the best possible picture, your benchmarking analysis should include both qualitative and quantitative information.
Consider the areas of your practice that drive financial output, not just the results themselves. Client interaction, business planning, risk management, IT and staff development (to name just a few) are all critical drivers of success.
4. Discuss your results with an expert
To avoid being blinded (or is that blind-sided?) by the numbers, ensure you discuss your results with your business adviser, coach or PDM.
ANNOUNCING THE BENCHMARKER
a new web-based tool for practices…
We’ve recently released an online benchmarking tool, which allows you to benchmark your practice against similarly placed businesses:
- 5 minutes to complete, 12 questions to answer, 27 ratios to consider
- Completely confidential
- Perfect for ‘what if’ scenarios
- Only $250 +gst for 1 year unlimited use/unlimited scenarios
NOW THAT’S WHAT I’M TALKING ABOUT!
the things clients say…
This comment was made by a client whose adviser had sought feedback through our confidential CATScan survey …a great insight which augurs well for all parties (client, child and adviser):
“One thing in particular that we really like is the attention afforded to our children. It’s imperative that they receive sound financial advice at an early point in their work lives and have support to implement the savings recommendations.”
Do you know what your clients are talking about?
WHY CLIENTS TERMINATE THEIR ADVISER
A recent survey from US based Spectrum Group, Millionaire Corner, found that the top reasons why clients choose to terminate their adviser’s relationship are:
- Slowness to respond to clients’ calls and emails
- Mistaken advice
- Poor communication
- Long term portfolio losses
While the client’s perception is always the adviser’s reality, the Survey commented that hopefully “feature-rich, cloud-based and mobile-ready systems are freeing advisers up to spend more time with their clients, increasing the frequency of communication they are able to provide through multiple in-person and online channels.”
For your consideration.
Send us your Ah-hah! moments (when someone says something that resonates with you and the lights go on!). Prizes for those we have not heard before. Some we have heard recently…
- You can’t manage what you can’t measure.
- If you decide it’s worth reaching out to the next generation, do so early – because it takes years to establish a relationship.
Client feedback without external validation is a missed opportunity.
Converting unique insight into practical, proven solutions
We offer a wide range of services, linked by a common goal – to improve the ongoing profitability of advisory firms. You can check us out in a little more detail by visiting our website at www.businesshealth.com or simply by contacting our office at firstname.lastname@example.org