Few business proceedings are more important to an ongoing growth enterprise than a well-planned and carefully-executed annual team review, but they are so often poorly handled by advisors. Whether it’s not putting the necessary time into advance planning and therefore “winging” it, or overlooking it entirely, advisors who aren’t seriously inspecting what they expect, in terms of the team’s overall performance, as well as the specific contributions of each team member, are going to find themselves more and more challenged in their ability to compete.

Teams should review their collective and individual performance at a minimum of once a year (quarterly reviews are recommended). The idea is to create an environment that facilitates an open and honest discussion with minimum distractions. Holding these review meetings outside of the office is healthy and encouraged, but not essential. Cell phones have become so fully integrated into our lives that we can now be interrupted anywhere, whether in the office or not, so you should carve out a period of time where you can enforce a “no interruption” rule. Wherever you hold your team’s annual review, you also want to schedule time for camaraderie; drinks and possibly dinner with your team following the review meeting.

Here’s how one team—three advisors and two support personnel—handled their 2011 annual review as they worked through the following areas:

·      Team Accountability – It is important to begin your team’s annual review with a performance review to reinforce the critical path concept; everything each team member does on a daily basis must be aligned with helping the team meet its long-range targets. You aren’t interested in someone working hard if they’re performing tasks not linked to achieving the team’s long-range goals (critical path). The team that I’ve chosen to guide us through the annual review process had set a target of $45 million of new assets from $1 million or greater households. At $32 million of new assets, they had fallen short of their target.  Their five-year goal was to have $500 million in assets. Only one year into their business plan and they found themselves behind schedule.

·      Individual Accountability – This is an assessment of each individual’s execution of areas of responsibility as they relate to the annual targets, linked to the team’s long-range goals. It is important to have pre-determined performance standards and expectations as well as a clear description of the role. You want to have clarity and standards assigned to each area. Only one of the three partners of the team we’re following had hit his new asset target by bringing in $22 million in new assets, exceeding his performance standard. His partners were left trying to explain why they had only brought in $6 million and $4 million, respectively. Each had an excuse; one had a knee replacement during first quarter, while the other had personal issues with a son dropping out of college. Both are committed to get back on track going forward.

·      Reviewing Successes – The successes of this team were all connected to the advisor who had brought in $22 million in new assets. He was able to penetrate a medical practice and establish a solid CPA referral alliance by using a physician client and a series of intimate events that were well-planned and non-business.  One of the support personnel was instrumental in pulling these off, handling all of the logistics while the advisor handled sourcing the names and the invitees. In all, they hosted six events—four wine tastings and two small dinner parties.  

·      Areas for Improvement – The two partners who didn’t meet their performance commitment admitted they’d let the team down and committed to making the necessary corrections. Everyone agreed to recommit to the weekly team meetings that had fallen by the wayside last year, and each partner’s weekly action plan was to be part of the agenda. One of their assistants was empowered to create the agenda for each weekly meeting and everyone agreed to make the meeting a priority. The partners also realized they needed more than an annual inspection, so they put quarterly reviews on the calendar.

·      Critical Path Action Plan – The partner who had brought in $22 million was not going to tolerate partners who weren’t going to carry their weight. The partners who had been remiss in meeting their performance expectations realized that their contribution would ultimately determine the team’s future. It was each partner’s responsibility to contribute at their predetermined performance expectations, or the team was going to disband.

Since then, there has been improvement, but our rainmaker partner is still out-performing the others in new assets and new affluent clients at a rate of two to one. In this instance, only one of the five team members was adamant about inspecting what is expected of everyone. If this team divorces, or if they decide to change the partner compensation split, everyone is now dealing with reality.  

Matt Oechsli is the author of The Art of Selling to the Affluent.  His firm, The Oechsli Institute, does ongoing speaking and training for nearly every major firm in the US.  @mattoechsli  www.oechsli.com