Given the pressures of the economy, declining revenues from investments and the increased demands of clients, the question is whether a one-person firm can even survive in today's competitive business environment, much less thrive. The larger firms, with multiple producers and presumably larger budgets, can take full advantage of the economies of scale. But what about small firms? Are they doomed to accept lower profits and less success?

Studies by groups such as Moss Adams suggest that the fate of the one-person shop is to accept defeat, or, at best, lesser profitability. Yet there are one-person firms that have found ways to compete with the big boys by taking innovative approaches, creating unique market deliverables, scaling back or outsourcing operational elements and/or specializing in narrow, highly defined areas of the financial profession.

One of the great leveling areas of financial practices is the Internet. The Web site of a one-person shop can be made to look as polished and sophisticated as that of a much larger financial firm. For this reason, the one-person shop can appear to be so much more than what it is.

Another area of a practice that can make a smaller firm appear larger is the advisor's creative use of outsource partners. There are many things in a financial practice that can be outsourced to give clients a higher level of service and a wider selection of products or to simply make the advisor's operations more efficient, freeing her to do what she does best. Let's take a look at some of these:

Virtual office: In this outsource arrangement, you might decide to work out of your home and then meet clients elsewhere. If you can't meet with them in their own homes or places of business, there is an outsource solution called the virtual office, offered by executive office suite locations that permit the use of meeting room facilities, for instance, on a "use-as-you-go" basis. Such facilities frequently offer additional services such as secretarial help, mail handling and reception, too.

Another twist on the virtual office theme is advisors using online resources for meetings with clients. The use of video conferencing services has grown in popularity in recent years and is a cost-effective alternative to face-to-face meetings. Some might argue that this is not practical for every meeting with a client, but for those clients who live in outlying areas or who might actually prefer video chats, it cuts down on the advisor's travel time and can be performed almost anywhere there is an Internet connection. Services such as Go To Meeting (www.gotomeeting.com), Adobe Connect (www.adobe.com/connect) and Skype (www.skype.com) offer varying levels of service. (Skype, for example, is a free service, but offers fewer features than the others.)

Video conferencing might help those advisors who have pockets of clients in far-flung areas. An advisor, for instance, who has a group of clients in his or her hometown but also a client nest elsewhere might find the video conferencing service advantageous.

Back office operations: This outsourcing opportunity comes in many sizes and shapes. One of the key questions in outsourcing is figuring out what you want to outsource. It could be elements of your practice that you do not know how to do, do not like to do or simply do not want to do. Outsourcing back office operations could fall into one of those categories.

Backofficeadvisor.com offers a host of services to fit this need. Elsewhere, companies such as Focus Point Solutions (www.focuspointsolutions.com), Financial Services Outsourcing Solutions (www.myfsos.com), Consider It Done (www.consideritdonecompany.com), Back Office Solutions (www.backofficesolutions.net) and many others offer an array of different services designed to free the smaller practices from the burden of back office duties.

Technology: Certainly one of the most advertised outsourcing services is technology. Yet outsourcing technology is still often difficult for advisors, not because it's hard to find vendors, but because there are so many offerings to choose from. One relatively new area is Web-based data storage, not simply for backing up data but as a replacement for an advisor's onsite computer server. Many of the most popular software programs for financial advisors are already hosted on the Web with Web-based storage. Everything from client relationship management functions to portfolio management to financial planning can be hosted on the Web with files stored virtually "in the cloud."

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