The NFL is a quarterback’s league. No matter how strong a game plan the head coach lays out or how good the 10 other guys on the field are, a team can never truly be a contender without a competent quarterback making the real-time decisions that are the difference between success and failure. That’s the reason that Tom Brady and Peyton Manning remain two of the highest paid (and most valuable) players in the league in spite of the fact that both are far beyond their physical primes.
Wealth advisory teams perform similarly to those in the NFL. Both types of team involve a disparate collection of highly skilled and intensely specialized members who somehow have to be brought together to form a coherent whole. However, while the NFL has recognized this need for a steady guiding hand and devoted a specialized position to it, wealth advisory teams are constantly bemoaning their lack of coherence and leadership while simultaneously expecting one of the member advisors to step in and take the reins.
The concept of a professional advisory quarterback is a new and interesting idea that’s gaining some steam. In an environment where technology and rapid globalization are leading to greater and greater degrees of institutional complexity and, as a response, more intense advisor specialization, a firm whose focus is helping clients indirectly through organizing and guiding their teams of specialists may offer unique value.
I recently spoke with Josh Coleman, founder of Chicago-based Momentum Advanced Planning, one of the companies at the vanguard of this movement. When I questioned him about what firms like his can offer that a more top-down approach at one of the larger wealth planning groups or trust companies can’t, he stressed the twin virtues of customization and flexibility. By assuming a role similar to that of a general contractor, Josh’s firm and its ilk can slot themselves into a leadership role in just about any situation.
If a client comes to them completely devoid of any guidance, then the quarterback can build his own team, drawing on a large network of advisors and specialists, both in-house and out, to create a unit to best serve that particular client’s needs by securing both core planning (basic needs regardless of wealth, for example college planning, mortgage payment, retirement, etc.) and advanced planning (the more specialized tax, charitable and next-gen planning required by high-net-worth families). On the other hand, if the client has some trusted advisors in place but weaknesses in other areas, then the quarterback can patch those holes from the aforementioned network without jeopardizing what the existing team already has in place, while simultaneously accepting a leadership role and ensuring that the advisors are communicating and working together.
Understandably, some advisors may not take kindly at first to having such an overseer brought in, but Josh maintains that Momentum actually receives relatively minor push-back from the pre-existing team and what little they do get tends to fade quickly once they begin working together. He attributes this phenomena largely to the fact that since firms like his aren’t necessarily offering a direct financial service, it makes them less threatening to the existing advisor as “We can’t do what they do,” which alleviates any initial feelings of usurpation. It also doesn’t hurt that about 50 percent of Momentum’s network of outside professionals is drawn from in-place advisors that clients bring to them. Referrals cure many ills it seems.
This relative formlessness is also an asset when it comes to actual decision making. In the traditional system, where one advisor is expected to step up and assume the quarterback role in addition to his other responsibilities, when faced with a problem, he’s naturally going to view it through the lense of his own expertise. An insurance specialist, for example, is likely to subconsciously lean towards using insurance to attempt to address an issue, even if it may not necessarily be the best fit, since insurance is what he knows. It’s a natural response. A professional quarterback, however, is unburdened by such an allegiance. He’s able to consult his network when a problem arises and then evaluate the various options before making a largely unbiased decision as to how to proceed. As such, he’s theoretically able to wring every last drop of efficiency out of the advisory team by ensuring that each problem is addressed by the optimal member.
The concept of the professional advisory quarterback is still relatively new, and it remains to be seen how viable it proves to be over time, particularly in terms of how willing clients are to pay to add additional members to their team (we’ve all experienced the extreme lengths to which even the richest clients will go to to reduce their fees). However, as advisors become more and more specialized and isolated, both philosophically and geographically, from their peers in adjacent professions, there certainly appears to be a growing niche for a strong hand to step in and devote itself to guiding the team.
