Selecting a business coach is not a common hiring task for you. However, approaching the choice as you would an investment due diligence evaluation fits in your comfort zone.
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Due Diligence Focus: What role is the investment expected to perform?
Investment Due Diligence Analogy: Knowing an investment’s purpose in the portfolio defines the parameters of its added value.
Business Coaching Application: Many advisor coaches emphasize personality assessments and leadership styles. With this approach, five main results are pursued:
- Mapping a leader’s style
- Targeting a firm’s culture
- Defining employee interactions
- Directing personal development
- Guiding employee development.
If these five elements are hurdles for you, then a one-on-one coach is your best alternative.
Our view is starting a small- to mid-sized financial and wealth business pre-selects those with the personal qualities and instincts necessary to operate a successful business. In other words, leadership is much less an issue than the means and methods of business planning, time budgeting, marketing, sales, service, and execution for sustainable results.
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Due Diligence Focus: What is the philosophy and methodology?
Investment Due Diligence Analogy: Identifying a portfolio manager’s philosophy and process determines if the portfolio selections fit with the overall investment strategy.
Business Coaching Application: Coaches typically use a common process and methodology; some create custom approaches. Behind this methodology is an underlying philosophy. Are your issues and challenges unique to you? Then a one-on-one coach fits best.
Practice in Action! is 100% focused on business planning, marketing, sales, and execution with a deep-felt belief that these operating issues cross all small- to mid-sized financial and wealth management businesses regardless of geography. We push teaching out of the ivory tower and into our Action! Group structure, wherein execution occurs through the prism of on-the-ground realities.
As a benchmark, over 74% of our Action! Group participants regularly assess the business value of each topic to be over $5,000; on an annual basis, this equates to a return several multiples greater than your investment. That’s an investment relationship you understand.
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Due Diligence Focus: What results should be expected for the costs incurred?
Investment Due Diligence Analogy: A successful portfolio requires an investment to produce fee-efficient results for the purpose it was called to do.
Business Coaching Application: The challenge in one-on-one coaching is the lack of accountable business results. While this would not apply when the coaching addresses personality and/or leadership hurdles, a business coach must be measured by an ROI. Otherwise, if there is no business return, all that coaching has done is keep your business on a treadmill.
ROI has two dimensions: costs and results.
Cost. Most coaching systems charge an average hourly rate of $350 per hour or $12,000 to $20,000 per year. [Source: 2013 8th Annual Survey, Sherpa Consulting, Inc.]
Practice in Action! charges $500 per month or $6,000 per year. With a two-layer coaching program—centralized and Action! Group-based—you receive hours of targeted, real-world insights and direction at an effective hourly rate many times less than one-on-one coaching.
Results. After each of the twelve topics (i.e. covering business planning, time budgeting, marketing, and sales), we ask a key question: “From the topic you have learned and implemented, do you see your firm’s efficiency improving, your revenues increasing, and/or your profits growing?” With each “Yes!”, your participation in Practice in Action! brings a profitable result; value has been added.
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Due Diligence Focus: How freely is key information provided?
Investment Due Diligence Analogy: The greatest risk in due diligence is making a decision without full and accurate information.
Business Coaching Application: Since 2008, study after study identifies a lack of transparency as an obstacle to trust. Just as your clients hire you based on your trustworthiness (one of three client hiring criteria, the other two being expertise/reputation and care/concern), so too will you hire a business coach according to the trust you impute to the coaching firm, its system, and the coach.
In the CFA Institute study, “Investor Trust Study”, the top criterion for building trust between clients and advisors is “Has transparent and open business practices”. For a coaching program intending to guide advisors, when evaluating business coach options, how transparent does the coaching firm make the program, its contents, expectations, and fees?