When family ties you down
The following is based on one of The Covenant Group’s clients. All of the names and telling details have been changed.
When Mike Tamarra discovered that the problem in his business was due to his love for his family, he was devastated. But he knew that if he wanted to achieve the success he’d always dreamed of he was going to have to make some tough decisions.
When Mike started in the business two decades ago he dreamed of running the leading financial services firm in his borough. He had pictured owning a small building in the suburbs and managing a team of subagents and specialists. At the age of 50, he found himself operating a small practice out of sublet space. His team consisted of his wife, two sons and daughter and a nephew.
“It’s a family business,” Mike explained. “We do okay, but I still want to run a leading firm.”
Mike had been in our program for some time. the program offered by one of the FMOs he was associated with. I asked him how he was doing with implementing some of the strategies he had learned.
“For the most part we’ve run on word of mouth and referrals, but I thought a lot about your concept of having six to eight robust promotional strategies. Last year I hired my son Jeremy to run marketing for us.”
“How’s that going?”
“I know he’s my son, but he’s done a tremendous job.” Mike asked if I had seen his website.
“It’s one of the best-looking advisor websites I’ve seen,” I said.
Mike smiled with pride.
“Has that driven a lot of business?” I asked.
“Before my son joined us, we didn’t have much of a website. We get comments all the time now.”
“The design and multimedia media elements of your website are great, but from a marketing point of view, it doesn’t do much. Effective sites incorporate things like permission-marketing strategies where prospects fill in data and grant you permission to market to them. Your site could promote events you are running or sponsoring, such as pitch and putt clinics, cultural events or community projects. Clients could RSVP on your site and be prompted to include data, such as their interests, that you could use to further market to them. There’s a lot your website could do to add marketing muscle to your practice.”
Mike agreed.
“Before your son joined, what priority did you put on building the website?”
“It wasn’t one of the top priorities, but that’s where Jeremy’s talents lie. We had targeted running weekly concept lunches, but Jeremy’s been busy on the website, so we’ve put that off for another few months.”
“Mike,” I said, “Jeremy is excellent at what he does, but you’ve let him define the role, which isn’t good for your practice. It’s a trap a lot of advisors and small business owners fall into. To run a profitable practice, you need to define a role and hire to that role. It’s certainly possible that someone in your family will fit that role, but that’s not usually the case. People who hire family or friends tend to hire to the relationship, not the role.”
When Mike asked what he should do, I said, “There’s nothing wrong with what you’re doing. The problem is that you have conflicting goals. If you are serious about achieving your goal of running a leading firm, then you have to hire to the role and hold people accountable to the tasks that fit your strategy.”
Mike thought long and hard about what we had talked about. In the end, he and his son both realized that the family business wasn’t for Jeremy. Mike helped Jeremy find a job as a web designer at a local television station. Jeremy loves the job. Mike replaced Jeremy with Kendra, a marketing graduate who likewise loves her job. She’s a dynamo who manages the firm’s varied marketing strategies. Mike’s business is now up 30% since hiring Kendra. He now believes he’ll eventually realize his dreams.
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