As many of our loyal listeners know, one of my favorite topics to discuss each month on our COO Roundtable podcast is the unfortunately common opinion in our industry that, “Operations are boring.” Or, even more pernicious, “Operations are just one expense line on our income statement—it’s the salesmen and saleswomen who move the real value around.” In an effort to elevate the tone of this conversation and enlighten those who hold this narrow view, I have explored this topic several times in this publication (see: Operational Excellence Drives Sales Growth and The Path to RIA Ownership on the Operations Track) ).
Jason Mirabella of Wealthsource Partners responded strongly on the podcast to my question on the potential conflict between sales and operations – he replied, “I Doing Think Operations has a branding problem in our industry. The term ‘operations’ in general connects the creation of a service model with the execution of commodity functions such as ‘strategic operations’ and paperwork; Which I think to be Gaslit has opened up us to believe that operations should play a subordinate role to sales and relationship management. In our most recent episode, Jennifer Wagner Kirksey shared a similar sentiment when she said, “I’ve always disliked the term ‘back office’ because, as Jason put it, ‘back office’ carries this notion. The ‘front office’ activities and operations that are involved in sales are not as important to customer relations as its activities take place in the shadow of the organization.
Operations hit the headlines in March 2020, when each RIA was forced to reinvent the way it supported its customers in a remote environment. The fact that our industry has experienced record growth for two straight years during an extremely volatile period is a true testament to the value drive for our organizations. RIA continues to evolve its service model and delivery as the entire world adjusts to our “new normal” in the wake of the pandemic. The question for all operations professionals is this: How do we maintain our momentum and avoid being pushed back into the shadows?
Trevor Philippi of 6 Meridian advises, “It really depends on the leaders within operations how their team is going to add value to the firm, to the consultants and ultimately to our clients. I believe that those operating should view our firm’s consultants as Bear Customer. It’s definitely not ‘us versus’. Them, ‘It’s really far from this. We are constantly looking at how we can prove our value to consultants, as they have to do to their clients every single day. ,
With the growth experienced by most firms over the past two years, many RIAs are turning to their operations teams to continue making progress in the years to come. Tom Preston of Brighton Jones explained during our conversation with him, “Finance, technology, our ability to recruit internally for new candidates, our ability to train internally, support teams across all of our business areas – these All are strategic benefits, brought about by operations, that help us grow faster.” Jennifer Wagner Kirksey commented, “Operations are truly an integral part of any firm’s growth. We evaluate which processes are cumbersome, manual or not effective and try to tackle those.” He then said, “We’re here to get the organization where it needs to go, so I feel really, really supported in my role and I think my firm is really at such a high level.” Understands the importance of needing a strong infrastructure to operate on.
While I continue to counter the notion that “operations are boring” whenever I have the opportunity, others think this mindset will be easily overcome by natural selection. Tom Preston said, “Whenever you mention this sentiment to other firms, I find myself shaking my head, simply because I think it misses out on such a huge growth potential in the firm. ” He continued, “Frankly, I have a sense of joy because if some of these guys are competitors, I probably don’t have to worry about whether the attitude of these firms is that operations are really going to push the needle.” Can’t move.”
Jason Mirabella ended our conversation on this topic by saying, “As the competition grows and the sophistication of running these businesses increases, I would say if you’re saying things like, ‘Operations are boring’ and ‘Sales people are the most important here.’ Kind of going out of business. I guess we’ll just have to wait. I say to the other partners on my team that, ‘Sales gives you opportunity to do business, but operations’ Is The business.’ I think the industry is slowly but surely coming to terms with that.”
For the continued growth of our industry, let’s hope Jason is right!
Matt Sonnen is the founder and CEO PFI Advisoras well as the creator of the digital consulting platform, COO Society, which educates RIA owners and operations professionals on how to build more impactful and profitable enterprises. He is also the host of the popular COO Round Table podcast. follow him on twitter @mattsonnen_pfi
