The Efficient Practice: Transform and Optimize Your Financial Advisory Practice for Greater Profits

CHAPTER 7

Building Procedures

It may be no surprise that written policies and procedures would be linked in some way to profit. What is surprising is how few financial advisors actually take the time to write them. For some, it may seem redundant to create a set of manuals if they already have similar types of written materials provided by their broker/dealer. So, to be fair, let's differentiate between broker/dealer–type policies and procedures and those that should be created separately by the financial advisor. And, while we are at it, perhaps we should also explore the reasons behind such an exercise.

Generally speaking, policies and procedures that are developed by broker/dealers facilitate the processing of paperwork and/or transactions, ensure appropriate compliance requirements, and protect the broker/dealer. Following such procedures generally also protect the financial advisor. However, policies and procedures that relate specifically to the day-to-day operation of a financial practice are most always left to the financial advisor to develop or customize to his or her needs. So, to understand how to develop such things, it is critical to identify what it is about your practice that needs a written policy or procedure.

Starting with policies, some of the easiest to identify are those associated with employees. An employee manual (or guide) can set out the rules of behavior and actions, identify inappropriate actions, and spell out remedies. It can also provide details ...