The competition is only getting fiercer among financial advisors, and those who don’t strive to always improve will fall behind. That’s the message coming out of the “Fidelity Inside Track” conference in Boston this week.

“We’re in a highly competitive market,” said conference participant Bob Oros, EVP of sales and relationship management for Fidelity Institutional Wealth Services. “RIAs are competing against more than 20,000 other RIAs firms and an additional 750,000 registered reps. The firms that are focused on the ‘whole’ of their practices -- from marketing, to training, to culture -- will be best positioned to stand out.”

Benchmarking Your Organization

There really is no secret sauce for a successful advisory practice, yet very few advisors are great at doing all the things they need to do.

Mathias Hitchcock, vice president at Fidelity Institutional Wealth Services, spoke at the conference about “high-performing” firms, sharing insights from Fidelity’s last RIA benchmarking study.

He started by telling attendees, “Comparing yourself is good. It is healthy.” It gives advisors meaningful points of reference, he noted.

Fidelity defines “high performing” with three criteria: a firm’s growth, profitability and productivity. The top 20 percent of advisors are seen as having 70 percent higher growth, 50% higher profit margins and 30% higher productivity per full-time employee. Depending on the size of the firm, that can mean the difference in millions of dollars in profits.

What Top-Performing Firms Do Differently

For those firms that want to do better, there are six categories in which they can benchmark their success, according to Fidelity.

1. Asset growth. To grow in this area, firms should focus on their new business, client attrition and growth in client assets.

2. Client targeting. Firms should apply greater rigor to their client selection. Hitchcock said that only 3 percent of high-performing firms pursue client opportunities outside of their target client profile, while 11 percent of other firms do. He also said that high performers close business in two or fewer meetings 72 percent of the time while the rest close that fast 53 percent of the time.

Firms that are more disciplined are more successful. If you have no written ideal client profile, you must create one and share it with staff, clients and strategic alliances. Also, you should work on the sales process, always trying to improve the closing ratio.

3. Client composition. The makeup of your client list can determine the success of the firm.

Hitchcock said high performers focus more intently on larger relationships. It is OK to have smaller client relationships, too, he added, but if you do, there should be a different business model.

That means advisors should analyze their books and deconstruct them. Are there concentrations by client size? If so, are there varying levels of service for each group?

4. Fee structure. There are different ways to charge for services. High performers are more likely to bundle services in their overall asset management fee, Hitchcock said. This can include bundling financial planning, estate/trust planning, tax planning, risk/insurance planning and philanthropic planning.

High performers also do not give their services away for free, but set relatively higher fees for larger clients.

The takeaway is that advisors should simply be more rigorous and consistent with the implementation of fees. Does itemized pricing for different services make sense, or is one bundled fee the better option?

5. Staff compensation. In high performers, the largest percentage of total head count is in non-advisor staff rather than in advisors and managers, said Hitchcock. In less-successful firms, advisors are the largest percentage of head count.

That means firms should evaluate what their management and advisors are doing in the work day that lower-paid employees could be doing instead. A shift in resources and job responsibilities can free up advisors and managers to focus on more profitable activities.

6. Operations ratios. A firm should use tools that allow it to monitor and analyze its health.

It should look at the client-per-advisor ratio, for example, and see if there are ways to improve internal efficiencies to ultimately improve profitability.

“The bar is continually being raised,” Hitchcock said. “It is harder and harder to get included in this high-performing group. It takes focus, discipline and execution.”

He reminded the attendees that benchmarking with such measures supports a strategic plan.

Becoming An Individual High Performer

Daniel Coyle, author of The Talent Code, spoke to the attendees at the Fidelity conference about how to be more successful.

He said those who are great at what they do likely spend 10,000 hours intensively practicing their craft. He quoted Aristotle about excellence, saying it “is not an act, but a habit.”

He also said that by pushing ourselves, we can learn more. If we “reach,” we learn better on the edges of our ability.

“Build your brain and skills through reaching and repetition,” said Coyle.

Mike Byrnes is a national speaker and owner of Byrnes Consulting, LLC. His firm provides consulting services to help advisors become even more successful. Need help with business planning, marketing strategy, business development, client service and management effectiveness? Read more at ByrnesConsulting.com and follow @ByrnesConsultin.