To determine your Pareto number, rank your clients in descending order by revenue and then bunch them into five proportional groups. The lead group is your top 20 percent. Doing this may not only help to better determine your ideal client profile but it will also make other business decisions much simpler as well.
My strategy centered on building deeper relationships with the people I believed I was best equipped to serve. As part of this, I focused on upgrading our technology and providing my staff with more training. The result was a higher level of satisfaction among my core client base, which ultimately led to new clients who fit my ideal profile—and more revenue.
This process was not easy, but it was successful, and I am confident many other advisors can do the same and prosper.
If the path seems daunting, turn to your business coach for reassurance, motivation and direction. The advisory business is better for you, your team and your clients when you shed distractions, get focused and create more direct correlation between client satisfaction and business success for yourself.
Greg Luken is the founder and CEO of Luken Investment Analytics, a turnkey quantitative research and asset management firm.