The end of the year is an excellent time for businesses to engage in strategic planning. That’s true whether we’re talking about a mom and pop ice cream shop or a large, multinational corporation. Wealth management firms are no exception.

Formulating a strategy begins by clearly defining your vision—what you aspire to be—and your firm’s overall objectives—what you want to accomplish. The next part of the equation, how you get there, is your strategic plan, and it helps to ensure that resources are deployed optimally to achieve your objectives.

Many founders/owners do this every year, and as a result, their businesses are growing. However, keep in mind that every strategic plan should be updated when the landscape changes, an important point given this year’s tumultuous events.

Here are some questions to consider when refining your strategic plan for 2021.

Is Your Strategy Well Defined?
To the extent that some firms have a strategy, it’s merely “to do more” or “to grow.” In other words, “Let’s do what we’re currently doing, only let’s do more of it to make more money.” Few would argue that boosting revenues is a bad thing. However, that’s an objective, not a strategy.

To put a finer point on it, think about a political campaign. If a candidate defines their race in personal terms (i.e., what it means to them or what they get out of it), it’s bound to fail.

Yet if they can create a compelling narrative and a shared sense of purpose around their candidacy, their team may be inspired to work harder, which could breed a more loyal following and a larger number of votes.

The same concept applies to your firm. If adding $100 million in AUM is the objective, half the battle is articulating a compelling reason to your team why they should care about it. (Few are likely to get excited about growth for the sake of growth because it reeks of self-interest.)

To get on board fully, they’ll need to know what’s in it for them. Because of this, how you frame and communicate your strategy is just as crucial as the strategy itself.

Do You Have The Right Strategy?
From there, it’s about making sure the strategy is aligned with your vision. Indeed, it’s not enough to have a strategy. It must be the right one for both your firm and the current environment.

Otherwise, you may waste precious time, money and human capital on an endeavor that was doomed from the start. The metaphor made famous in the book The 7 Habits of Highly Effective People by Stephen Covey comes to mind: “If the ladder is not leaning against the right wall, every step we take just gets us to the wrong place faster.”

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