As the year comes to a close, it’s a good time to take stock of where your business is today and where it is going. That includes thinking about your current business model, how you’re serving your clients’ needs and where you are looking to take your business in the future. In this issue, we speak with Tom Nally, Managing Director of Institutional Sales at TD Ameritrade Institutional, to guide us through six questions advisors should be asking themselves.

Question 1: Do I have a business plan in place, and how can I develop and stick to that plan in 2011?

Business plans are important because they help take you where you want to go. They may not be hard to make, and they don’t have to be complicated. In order to be the most effective, however, you have to take a long, hard, honest look at your personality, your business today and your hopes and dreams for the future.

First, think about where you are today. Then set out your short-term and long-term goals, taking into account factors such as your clients, employees, personal life and professional life. When you have it in writing, you can refer back to it and gauge how your plan is going. Are you interested, for example, in transitioning more to a fee-based business? Keeping more of what you earn? Joining forces with other like-minded advisors? Becoming a fiduciary? Growing your high-net worth business? These are all questions to keep in mind as you set out your goals for the future.

Question 2: A firm should be the engine behind you and your business. What role does my current broker/dealer play?

As with any job or career, you need to evaluate how the firm you work for is helping you grow, build and improve. Ask yourself the following questions: Does my firm understand my goals? Is the firm supportive about helping me achieve those goals? Does the firm provide an environment that fosters growth? Does the firm enable me to service my clients the way I see best?

According to the recent Advisor Evolution Study, conducted by TD Ameritrade Institutional and Registered Rep, clients generally are more loyal to the advisor, not the firm they work for. That’s why it’s important to understand how your firm supports you and your ability to serve clients. If the answers to any of these questions aren’t satisfactory to you, this should, at the very least, raise a red flag about your long-term commitment to the firm.

Question 3: Am I providing my clients with the right products and solutions?
At the end of the day, it’s all about the clients—having the right products and services in place to meet their needs. As such, it’s important to ensure that your current broker/dealer provides a broad array of products and services, as well as choice and flexibility.

As the wealth management needs of clients evolve, you need to make sure you will be able to meet the planning demands of your clients. The industry is becoming more complex, and you must be able to help clients with a multitude of investment challenges, such as income planning, retirement savings, wealth preservation, wealth transfer and more if you hope to keep those clients long term and service them appropriately.

If you align yourself with cutting edge solutions, this may help you better serve your clients, differentiate your business and build a reputation to help gain referrals.

Question 4: Are my firm’s goals aligned with my vision of the future?

Sometimes a company’s direction does not always align with your own investment philosophy, goals or client-servicing philosophy. This disconnect can inhibit your growth.

When you work for another firm, it may be important to have access to senior management and be able to make your voice heard. If you want more control of your business and feel you don’t have it, it might be time to consider another firm, or a change to a business model that will give you more autonomy.

Question 5: Am I worth more to my broker/dealer than it is to me?

Do the math. Look at the services you are getting from your broker/dealer such as compliance and marketing. Then determine whether you are paying more than you are getting back in services. Are you paying for things you’re not using? Are your clients paying for things you’re not able to utilize on their behalf? After all, it’s your clients who are the losers when hit by excessive fees and pricing.

Our experience shows that the larger a practice gets within a broker/dealer structure, the less dependent the practice is on the home office. If you are in this situation, you might find you can do better in an independent environment—where you are able to retain 100 percent of revenues generated and determine how the revenues get spent.

Question 6: How can I push my business to the next level?

First, you have to know where you are. Then you need to know where you want to go. Finally, you need to think about the ways you can get there. Perhaps you should speak with other advisors from different channels. It also might make sense to start researching other business models to see what’s available. This isn’t a one-size-fits-all business. There are opportunities to do fee-only or a combination of fees and commissions. There also are different types of firms and structures. For example, you could start a registered investment advisor (RIA), join an existing RIA or join an independent broker/dealer, a regional firm or another wirehouse.

In addition to researching different business models, you always can find room for self-improvement. Have you considered pursuing a Certified Financial Planner designation, or another designations that will help you serve your clients? Are there certain products you would like to learn about that can help meet your clients’ needs?

Whatever you do, it’s important to consider continuous development and evaluate growth opportunities for your practice on an ongoing basis. If there’s no opportunity for growth, or if you’ve taken your business as far as you can in your current model, it may be time to consider a change.

Tom Nally is Managing Director of Institutional Sales for TD Ameritrade Institutional.

TD Ameritrade Institutional, Division of TD Ameritrade, Inc., member FINRA/SIPC/NFA. TD Ameritrade is a trademark jointly owned by TD Ameritrade IP Company, Inc. and The Toronto-Dominion Bank. © 2010 TD Ameritrade IP Company, Inc. All rights reserved. Used with permission

Questions or feedback? Please email us at nextmove@penton.com.