This week marks the one-year anniversary of the Connected Advisor Newsletter.

Each week this past year, we’ve brought you a collection of thoughts, research and philosophies shaping financial advice's future.

As we move into the long weekend, this week’s focus will be on:

1. The Conductors Guide to Ever Improving RIA’s

2. On the Pod: How Collaboration and Alignment Drive Organic Growth with Scott Colangelo

3. Jack Sharry’s 5 Lessons from 150 Wealthtech Podcasts

4. We Are Drowning in AI, and the Rain Hasn’t Started

5. On the Road

The Conductors Guide to Ever Improving Wealth Management Firms

This past week, as part of our end-of-year activities, my sixth-grade daughter performed for around 1,000 people from our community, marking the conclusion of her orchestra season.

Watching her journey as a violinist has been wonderful.

It’s not just her individual growth that stands out, but the collective transformation of the entire orchestra.

This metamorphosis from a group of individuals who squeaked out individual notes just last fall to a cohesive unit playing music dynamically beautifully mirrors the change and success we strive for in our organizations.

Reflecting on nine months of practice, training, and mentorship, it’s amazing to see what kids can achieve, even when the students apply different levels of discipline.

Like so many teams, the kids started all over the place. Each home situation is different, and each student has a unique dedication and learning style.

But under the proper guidance and repetition, all of those variables suddenly fade away with the orchestra's quickly synchronized rhythms.

This growth process is a powerful reminder of the transformations we aim for in our teams. When we start a team, we assemble a diverse group of talented individuals, figuring out their roles, understanding the market, and learning how to deliver unique services effectively.

The success of an orchestra—or any team—often hinges on the conductor’s ability to orchestrate various elements harmoniously. As leaders, we play a similar role. Our job is to help everyone play their part well, ensuring all components work together seamlessly. This involves guiding, supporting, and sometimes participating directly in the work to lead by example.

In wealth management, like in music, we need to help others read the sheet music, understand the dynamics, anticipate changes, and work together. What happens when we see our team struggling? How do we minimize the wrong notes, help our team feel the dynamics and anticipate what’s coming next?

Evaluation

Just like my daughter’s orchestra, your team needs continual evaluation in order to get feedback that helps them improve.

Do you have a daily, weekly, monthly, quarterly and annual review system?

Are you following it?

Make sure your team knows the details about what they are going to be evaluated on and how that review will take place. Calendar the reviews and don’t let them fall to the wayside.

Of course, just having evaluations won’t make your team better. You’re going to have to hold them accountable to the work they agreed to do and set up systems and plans for anywhere they are falling short.

If you want optimal performance, help them understand how working differently from how they have been will create something greater. Help them understand how their work connects to the whole orchestra. Obviously, you have to have a clear vision of what success looks like and make adjustments as needed to achieve that vision.

The Risk of Just Hoping for the Best

Over the past nine months, my daughter’s orchestra teacher has had to work with her students to weed out ideas and behaviors holding the musicians back. She has corrected finger placements and inter-student hijinks. She has had to discern when to step in and when to ignore something and let the students learn on their own.

I’m sure it wasn’t easy because leading people is never easy.

Leading them through teachable moments and helping them stretch beyond their current knowledge or behavior is not something you can just hope will improve.

How you communicate change matters. Here’s why:

1. Damaging Trust: Frequent or poorly communicated changes can lead to uncertainty and mistrust among employees. A study by SHRM found that 60% of employees experience stress and reduced trust when organizational changes are not communicated effectively.

2. Lowering Morale: Disruptive changes can lower employee morale, decreasing productivity and increasing turnover. Research from the Chartered Institute of Personnel and Development (CIPD) indicates that organizations with high levels of change without proper support see a 30% increase in employee turnover.

3. Creating Confusion: Without clear reporting lanes, your team may become confused about their roles and responsibilities, leading to inefficiencies and mistakes. If we want to curb those wrong notes, we need to make sure that every player knows their part, and in so doing, every person will experience reduced stress, more profound clarity, and a sense of more substantial purpose.

When You Need to Rearrange the Team

If your team needs to be reorganized, here are the two key points to keep top of mind as you begin:

1. Optimize for Skill Sets: Reassessing and realigning roles ensures that each team member’s skills are used effectively. According to a study by McKinsey & Company, ~40% of team members find that the complexity of their teams hurts their overall productivity.

2. Structure for Efficiency: Clear lanes of reporting help streamline processes and reduce bottlenecks. Like in any activity, the clearer each person understands their part of the playbook, the more successful each play will be.

Conclusion

As we move into summer and finish Q2, I’d love to hear how you are arranging the chairs in your organization.

What are your keys to orchestrating excellent outcomes?

Share your strategies and insights, and let’s learn from each other.

On the Pod: How Collaboration and Alignment Drive Organic Growth with Scott Colangelo

Episode 44: In this episode of The Connected Advisor, Kyle interviews Scott Colangelo, Chairman and Managing Partner at Prime Capital Investment Advisors (PCIA) and Managing Director of Qualified Plan Advisors (QPA). Recognized for his vision, leadership, and innovation, Scott shares his industry knowledge and passion for empowering clients with education and guidance to achieve their financial goals.

Scott discusses the collaborative nature of wealth management firms in Overland Park, Kansas, and the four pillars of a healthy firm: wealth, retirement, education, and production. He highlights the ongoing value of personalized guidance and education for clients and the role of technology in freeing advisors to build stronger relationships. Scott is optimistic about the industry’s future, emphasizing the importance of technology and AI.

Key Takeaways:

1. The industry is shifting towards a holistic approach, integrating wealth management, retirement planning, education, and product production.

2. Alignment within a firm is crucial, exemplified by Prime Capital Advisors’ ownership structure that aligns advisors’ and the firm’s interests.

3. Education and wellness programs are vital in reducing stress and enhancing clients' financial well-being.

4. Technology and AI will streamline processes, allowing advisors to focus on client relationships.

Quotes:

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Jack Sharry’s 5 Lessons from 150 Wealthtech Podcasts

Jack Sharry and the team at LifeYield recently celebrated their 150th episode of WealthTech on Deck. As part of his milestone, Jack summarized the five key lessons he’s seen come out of 3 years of podcasting and interviewing the top voices and leaders in our industry.

We Are Drowning in AI, and the Rain Hasn’t Started

I found this tweet effective at showing how deafening tagging everything as AI has already become.

In a year or so, I think elements of AI will be a part baked into the central features of computing. While AI is the hot topic of today as a main feature, it will be just one of the ingredients in the broader recipe of applications.

To get ready for this next phase, we would benefit from ensuring that our teams become AI practitioners in their daily job functions.

How to Work with My Team

1. Gain Control of Your Data, Analytics, and Experience: Milemarker

2. Optimize Your Firm Operations and Technology: Milemarker Services

3. Streamline Your Private Investment Experience: Mammoth Technology

Milemarker on the Road

Catch our team on the road at the following events or cities:

1. June 5-6 - Fargo, ND

2. June 10 - Omaha, NE

3. June 13 - Fort Mill, SC

4. June 12 - Charlotte, NC

5. July 5 - Minneapolis, MN

6. July 15-18 - Denver, CO

If you’re in any of those cities and want to arrange a meeting time, reply to this email, and we’ll get something on the calendar.

Jud Mackrill