Article 6 steps to grow your business organically

In recent years, growth within the financial advice industry has been largely associated with a flurry of mergers and acquisitions. It’s a form of inorganic growth that can quickly – and expensively – enable firms to absorb new talent and clients seemingly overnight. But, in its immediacy, can also offer little beyond its short-term scope.

Now, as the government continues to drive forward its plans for homegrown UK economic growth, the focus may be shifting towards an industry that favours the more sustainable, long-term approach of promoting organic strategic growth from within. In fact, 50% of advice firms now say they want to grow organically by hiring staff or adding assets from clients new to their business.¹

This statistic, and many others, can be found in the new NextWealth guide, Organic Growth for Financial Advice Firms, commissioned by Aegon. And to help you tap into the potential of organic growth, this article will use the findings from it to explore the 6 steps your business can take to grow strategically and sustainably.

• Step one: Prepare the ground
• Step two: Define your strategy
• Step three: Be consistent and repeatable
• Step four: Track and measure
• Step five: Invest for the future
• Step six: Stay agile, stay aligned

Step one: Prepare the ground

An important first step you’ll need to take is to assess your firm and personal readiness for the journey ahead. Sustainable growth strategies start with knowing whether now is the right time for you to scale up, and considerations of what groundwork may be needed to set you and your business up for success.

From the firm’s perspective, you could review your company purpose, client base, tech and data systems, team structure, or the service you offer. You might identify areas of strength that represent an attractive opportunity, or gaps that need attention. In particular, NextWealth highlight that only 22% of advice firms have a clearly defined profile of the types of clients they hope to target when growing organically.

Having an identifiable and measurable client profile when setting your growth strategy could allow you to more successfully target them. This applies across your channels too, with the data showing that advisers with a more defined target client profile gain more clients from a greater variety of outreach activities.

It’s important to assess your personal readiness too, especially if you work alone or in a small team. Creating and implementing a growth strategy is unlikely to be a quick burn, and it’s important to ensure you don’t stretch yourself too thin – both for your existing clients and your own wellbeing.

Step two: Define your strategy

Although half of advisers in the UK say that they want to grow their business organically, only 10% have a clearly defined strategy for doing so. In fact, 31% have only a rough idea of how they’ll grow, while 36% have no strategy at all.

Unlike inorganic growth, organic strategic growth often requires a more long-term, people-first mindset, defined by elements such as your purpose, ambition and team alignment. Through guiding principles and shared beliefs, it’s vital to bring the whole team along for the journey.

Strategic growth doesn’t have to be fast, either. It can be focused, sustainable, transparent and culture-led, based on a plan you can measure and refine over time. Having aligned your team on purpose, ambition and proposition, be sure to set clear, time-bound goals for acquiring new clients and growing new assets.

Step three: Be consistent and repeatable

A defining characteristic of scalable propositions is operational consistency when delivering their product or service – and this can apply to financial advice too. Achieving alignment between your advice proposition and your client experience could strengthen your reputation, build advocacy among key groups, and support sustainable growth for your firm without compromising service quality.

Some of the ways you can promote consistency in your business include:

• Standardising your advice process, including client onboarding, reporting and communication.
• Ensuring your service reflects your brand and the individual adviser.
• Building processes that support referrals and marketing across unique channels.
• Analysing insights as a team, making use of visual aids to promote key messaging.

Step four: Track and measure

As we know, having a clear understanding of what success looks like and how it can be measured is key to organic growth. It enables you to see what’s working, what needs tweaking, and where you may be missing out. Transparency and collaboration in tracking and measuring your success can also help from a cultural view, inspiring your team to keep pushing or be onboard with change. Ultimately, having clear and high-performing data systems can be a big growth differentiator.

Your chosen metrics will be unique to your growth purpose and mission, but some examples could include your client numbers, the value of your assets under advice, net ongoing fees per adviser, or new recurring revenue. You’ll also want to measure the success of your growth strategy and relevant activities, which could mean tracking inbound leads per channel, conversion rates, or time to onboard clients.

However, the NextWealth data highlights one particular measure that only a quarter of advice firms track: share of wallet. Tracking share of wallet could present a clear path to growth, as you seek to increase the proportion of a client’s asset value that you advise on. It could be quicker too, with onboarding a brand new client possibly taking much longer than sitting down to review the assets of an existing one.

Step five: Invest for the future

As with any growth, scaling up requires the right technological systems and team skills – for both now and the future.

Aside from regulatory changes, NextWealth found that 35% of advisers believe easier onboarding technology would most help them to acquire new clients in the next 18 months, while 32% advocated for greater implementation of artificial intelligence (AI) to support adviser capacity. This was followed by better back office integration with platforms (26%) and improved digital tools (18%).

From a team perspective, 17% of advisers think that hiring younger advice colleagues would help them to secure more clients. Further data highlights that younger advisers are more likely to work with clients in earlier stages of accumulation and those with simpler or transactional needs. They’re also more likely to generate a higher proportion of their annual revenue from new clients (22%), compared to advisers aged 55 to 64 (14%).

In terms of how you can go about investing in the future of your business, there are a number of options. Training and progression for colleagues could include the development of junior advisers through the use of structured cases and colleague shadowing, supporting people to specialise so that the right tasks are done by the right people, or creating defined development pathways within the business. Utilising a phased approach when adopting new processes or propositions could also help you to expand your capacity without losing control of your service. And lastly, strengthening relationships with partners could generate sustainable referrals through manageable channels.

Step six: Stay agile, stay aligned

Sustainable growth is a continuous cycle of review, realignment and reinvestment. It’s important to always be open to change, while staying aligned in your purpose and ambition.

New developments in the regulatory or economic environment are examples of unforeseen circumstances that could cause your growth strategy to pivot, possibly substantially. However, these events could be opportunities as much as challenges. For example – the ongoing Targeted Support initiative could represent a new avenue for you to offer a lighter-touch, tech-enabled service to a wider range of clients.

Of course, however you plan to grow, the ultimate goal is to serve your clients in a manner that is effective and proportionate to their needs. Your client experience should remain personal and consistent, with your growth only helping to enhance trust and inspire even more positive outcomes.

Find out more

Organic growth can take a long time to achieve, but the rewards it can offer are many, significant and sustainable. The routes you can take are varied and exciting too, supporting your business to grow in way that suits you and your clients.

For more insights into how your advice business can grow organically, you can read the full NextWealth guide on our Organic growth hub.