Welcome, everyone! Welcome to the 68th episode of the Financial Advisor Success Podcast!
My guest on today’s podcast is Heather Fortner. Heather is a partner and the Chief Operating Officer of Signature FD, an independent RIA that calls itself a “financial design” firm and now serves more than $3 billion of AUM for nearly 1,000 clients.
What’s unique about Heather’s firm, though, is not just the nature of its holistic “financial design” process that aims to help clients with all their types of wealth – both money, time, and relationships – but serves its clients by organizing the firm and its advisory teams into “communities”, or what essentially are a series of various niches, all under the Signature FD umbrella, including SignatureLaw, SignatureHealth, SignatureEntrepreneur, and more.
In this episode, we talk in depth about why and how Signature FD transitioned from a broad-based generalist firm into a series of niche communities, the way it has adopted Angie Herbers’ “Diamond Teams” structure to grow and develop their advisor talent, the Entrepreneurial Operating System it uses – built from Gino Wickman’s book “Traction” – to help ensure that every employee understands how they connect to their department’s 1-year goals, the firm’s 1-year goals, and the long-term outcome for the firm, and why SignatureFD uses an Industrial Psychologist as a part of the final screening process for everyone the firm hires to help really ensure they’re a good long-term fit.
We also talk about Heather’s own career track in the firm, from joining as a “client care associate” in the operations team nearly 15 years ago, to becoming the Director of Operations and later the Chief Operating Officer, getting involved in several industry Executive Leadership programs, and eventually making partner in the firm… in a world where it’s still relatively rare for such “non-revenue-producing” members of the firm to have an opportunity to become a partner, especially women, despite the value that good executive leadership in operations can create for a firm.
And be certain to listen to the end, where Heather talks about how advisors can identify the “right” firm to stick with in the long run, and the skills that she believes are most important for everyone, but especially women, to develop to climb the career track in an independent advisory firm, and why she believes that the challenges of family dynamics and caring for children may be one of the biggest and most understated issues limiting the career growth of women in independent advisory firms today.
So whether you are interested in learning more about how large firms can serve multiple niche markets, how to best structure teams to grow and develop talent, or are interested in how non-revenue-producing employees can progress to executive leadership positions in an advisory firm, I hope you enjoy this episode of the Financial Advisor Success podcast!
What You’ll Learn In This Podcast Episode
- What makes SignatureFD’s unique business model work. [4:18]
- The three components that make up wealth, according to SignatureFD. [8:11]
- A major benefit of the diamond team model. [17:57]
- What diamond teams are, and how they’re structured at SignatureFD. [17:57]
- Why diversity of thought leads to a better product. [28:01]
- How SignatureFD decides which niche to go after next. [34:01]
- Why communication skills are essential for an advisor. [57:04]
- How Heather went from a Client Care Associate to partner and COO. [1:02:24]
- Why the firm uses an industrial psychologist as part of its final screening process. [1:12:26]
- What a lifelong learner can do to improve themselves on a COO track. [1:22:07]
- Why value creation is a better focus than revenue production. [1:32:35]
- Advice for people in operations roles within advisory firms who hope to be partner. [1:38:33]
Resources Featured In This Episode:
- Heather Fortner – Signature FD
- Angie Herbers’ Diamond Team Model
- Nerd’s Eye View: The Four Skill Domains For Financial Advisory Mastery
- Traction by Gino Wickman
- Nerd’s Eye View: Key Questions To Ask In A Financial Planning Job Interview
- The Management Psychology Group
- IACCP designation from NRS
- Schwab Executive Leadership Program
- G2 Leadership Institute
- Crucial Conversations by Kerry Patterson
- FA Success Podcast Ep. 038: From Wirehouse Cold Calling Scripts To The Flexibility Of Independence With Winnie Sun
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Full Transcript: Becoming A Non-Revenue-Producing Partner In A Multi-Niche Financial “Design” Firm with Heather Fortner
Michael: Welcome, everyone. Welcome to the 68th episode of the “Financial Advisor Success” podcast. My guest on today’s podcast is Heather Fortner. Heather is a partner and the chief operating officer of SignatureFD, an independent RIA that calls itself a financial design firm and now serves more than $3 billion of assets under management for nearly 1,000 clients.
What’s unique about Heather’s firm, though, is not just the nature of its holistic financial design process that aims to help clients with all their types of wealth, both money and financial as well as time and relationships, but services clients by organizing the firm and its advisory teams into what it calls communities, or what are essentially a series of various niches, all under the SignatureFD umbrella, including SignatureLaw, SignatureHealth, SignatureEntrepreneur, and more.
In this episode, we talk in depth about why and how SignatureFD’s transitioned from a broad-based generalist firm into a series of niche communities, the way it’s adopted Angie Herbers’ Diamond Team structure to grow and develop their advisor talent, the entrepreneurial operating system it uses, built from Gino Wickman’s book, “Traction,” to help ensure that every employee understands how they connect to their department’s one-year goals, the firm’s one-year goals, and the long-term outcome for the firm, and why SignatureFD uses an industrial psychologist as a part of its final screening process for everyone the firm hires to help really ensure they’re a good long-term fit.
We also talk about Heather’s own career track in the firm, from joining as a client care associate in the operations team nearly 15 years ago, to becoming the director of operations and later the chief operating officer, and getting involved in several industry executive leadership programs to the point of ultimately making partner in the firm, in a world where it’s still relatively rare for such non-revenue-producing members of a firm to have an opportunity to become a partner, especially women, and despite the value that good executive leadership and operations can create for a firm.
And be certain to listen to the end, where Heather talks about how advisors can identify the right firm to stick with in the long run and the skills that she believes are most important for everyone but especially women to develop to climb the career track in an independent advisory firm, and why she believes that the challenges of family dynamics and caring for children may still be one of the biggest and most understated issues limiting the career growth of women in independent advisory firms today.
And so with that introduction, I hope you enjoy this episode of the “Financial Advisor Success” podcast with Heather Fortner.
Welcome, Heather Fortner, to the “Financial Advisor Success” podcast.
Heather: Thank you. Great to be here.
Michael: I’m really excited to have you on the podcast today because you have a rather unique path. And I wish it wasn’t unique, but it just is relative to the industry. You are a partner at a $3-plus billion independent RIA in the Atlanta area called SignatureFD. And unlike I guess frankly most partners at advisory firms, you do not wear an advisor hat. You are a chief operations officer and a chief compliance officer. And right or wrong, like, the history of partnership at most large advisory firms usually is the people that manage the client relationships and manage the revenue and bring in the revenue tend to be the ones that become partners.
And so, you know, like, the fact that you became a partner wearing an operations and compliance hat and as a woman, which is also not terribly common amongst partners in advisory firms in the industry. Like, I wish it wasn’t true that you are, like, the rare of the rare partners that is a female COO partner in a firm, but here we are. And so I’m really excited to be able to talk a little bit about that story and that path of what you’ve gone through to become a partner and move to that level of responsibility in a firm.
What Makes SignatureFD’s Unique Business Model Work [4:18]
Michael: A very sizable firm. So maybe even as just in getting started, like, can you tell us a little bit about SignatureFD as it exists today? Like, who are you guys and what do you do?
Heather: Yeah. So we are a financial design firm based in Atlanta, Georgia. As you mentioned, we are about $3 billion AUM, and our whole premise is “Impact by design.” So we believe that people want to have an impact with their wealth and that their wealth encompasses their time, their money, and their relationships. And so our whole goal in financial design is to be able to protect, live, grow, and give that person’s wealth, taking into account all three of those components that make up wealth.
Michael: So let me even pause you there. Like, there was a lot of…there’s a lot of meaty stuff there. I feel like these are things that you guys say because it’s your marketing and your process, and the rest of us are like, “Wait, wait. No, wait, that was really good.” So wealth encompasses time, money, and relationships.
Michael: And you try to help people live, grow, and give their wealth.
Heather: And protect.
Michael: And protect their wealth.
Heather: Yes. Yes.
Heather: We believe that those are the components of financial design.
Michael: Okay. And I know like that’s part of how you brand the firm. That you guys don’t say you’re, like, a wealth management firm or a financial planning firm or all those terms that we tend to use in the industry. You guys label yourselves as a financial design firm.
Heather: Yeah. We really believe that the difference in those things is that design is intentional, and it is artistic, and it encompasses a technical underpinning that requires expertise in the technical components, but that it is a beautiful art that comes out when you are able to build the base of the technical expertise and then really truly design the components that encompass an entire client’s wealth. And when you can help them with their time, and when you can help them with their money, and when you can help them with their relationships, that those are the things that truly allow them to live the life that they desire.
Michael: And so I feel like you’re sort of articulating kind of the intersection of the technical aspects of financial planning and call it like the softer side of financial planning, just without actually using any of those words. You’ve got your own words and they’re beautiful. I love them. It’s like, “Design is intentional, design is artistic, but it has technical underpinnings.” Like, it’s an interesting way to frame what happens in financial planning without…well, kind of, I guess without using the same words that everybody else uses, which in a world where we’re all trying to differentiate, like, that’s pretty powerful when you can actually figure out how to articulate the value proposition differently.
Heather: To me it’s very similar to, you know, I think about the great architectural beauties that have been created throughout history. And I think, you know, there’s a very complex scientific, technical aspect to building, but there is also a beauty around the design of these buildings that is meant to accomplish something. And very similar to that, I believe that that’s what we hope to accomplish as designers with an overall client’s financial life.
The Three Components That Make Up Wealth [8:11]
Michael: So who do you work with? Like, what does a typical SignatureFD client…? Like, I’ll admit, I feel like this…you know, “We’re a financial design firm that helps you, you know, with the wealth. That encompasses your time, money, and relationships.” I feel like there’s a certain level of affluence that kind of has to be on the table for people to be focused on those issues, right? Like, up to that point it’s just like, “No, I just try to have enough money to pay my bills. I can’t really deal with this other stuff.” Are you in a particularly high-net-worth space or, like, who’s the target clientele that you have for this kind of holistic financial design process?
Heather: You know, I think I may disagree with your assessment because I believe that people overall are concerned with those things. They may just not have the freedom in their mindset to think about those things in the same ways that other people do. So I think that that’s an interesting area where our communities come into play.
And so if you think about the evolution of our business over time, when the founding partner started the firm 20 years ago, I think it’s probably similar to how a lot of other businesses started. There were clients coming from all over, and so these practices became…they were just very generalist practices. You know, one advisor may have been working with 20 different types of clients. But over time, as the business has matured and as our advisors have matured, they really found the areas where they excelled or the communities that they were most passionate about serving.
And so the business has evolved really to these niche practices. And that’s what we call our communities. And each of these communities is different because the communities have very specific needs. So SignatureWomen, SignatureExec, SignatureEntrepreneur, SignatureYoungProfessional, all of these communities have very specific needs particular to that community.
But underpinning all of that is a philosophy and a belief that…well, there’s two beliefs really. There’s the belief that people want to have an impact, and they do that through their wealth, which is their time, their money, and their relationships, regardless of whether they have $50,000 or they have, you know, $50 million. That is an innate human desire to make a difference and to add value.
And then we believe that, and this is an interesting…I think if you looked at Maslow’s hierarchy of needs, people have a need to belong. And so these communities not only allow us as a business a way to better serve specific client needs, because we have people who are passionate about that particular community’s needs, but it allows us an opportunity to connect people into a community where they may want to belong and to help fill that basic need of belonging that they may have. To talk to people who are like them, to talk to people who may have experiences like them.
Michael: So you mean like helping your clients in a niche network with each other? So like…
Michael: …you have SignatureEnterpreneur, so literally just doing things to help your entrepreneur clients network with other entrepreneur clients?
Heather: Absolutely. Absolutely. And then also, you know, from a business perspective, it allows us a career path and an opportunity for our team to get involved in areas and communities that they themselves are passionate about. So ultimately, I feel like it is an incredible way for multiple people to be involved in things that they’re passionate about. To grow and to offer a better experience overall to clients needing help.
Michael: So I’ve got…like, I have all sorts of questions around this. So I get where the firm came from. I mean, like, almost all of us as advisors, when you get started, like, you get anyone you can as a client. You’re just trying to get revenue in the door so you can, like, pay your bills and survive.
Michael: And then, you know, hopefully, that builds a little bit of momentum, and then the people you’ve served start referring people they know and you start getting some referral business coming in. But since early on you were working with anybody you can, the referrals tend to be all over the place as well, for the same reason. And, like, most of us simply grow and build in that manner and just keep going in that manner. You know, like, I know a lot of firms that literally, like, they differentiate by being generalists. By saying like, “I can cover the full range of stuff and I can be holistic with you because I’m a generalist so I’m not overly focused in any one area.” And you guys seem to…I mean, A, you seem to approach that differently by saying, “No, no, no, we want to organize our clients into niches or into communities.” And I guess what’s even more fascinating to me is like you made a transition to that.
So let me start there. Like how do you have all these advisors, I’m assuming a lot of them were probably, like, partners or early founders who had these generalist groups of clients all over the place and now they’re focusing on niches. Like, did they actually make that transition? Is that like, “No, no, the early advisors still have their generalist things but all the new advisors started building into inches,” or did you actually pivot everyone in the firm where they’re only in one community? Like, how does that transition come about when you’re already a firm and have all these advisors and clients all over the place and you’re trying to wrangle it in this direction?
Heather: It’s an evolution and it’s a transition process. And I think what happens over time naturally is that as advisors are in this business longer, I think they find areas that they themselves are passionate about. Obviously, you know, an advisor who’s been dealing with a client for a very long period of time, if she no longer fits into, you know, his niche, you know, he’s not going to not have her as a client, but what he may do over time is begin to transition that relationship to a next-gen advisor in the company.
And so I think that that is also a great way to do two things. One is to build the skill level of the next generation of advisors coming up through the business, but it’s also a great way for the more experienced advisors to be engaged in the development and the coaching of that next generation and not to just expect the firm overall to handle growing and grooming the next generation.
Michael: Because in essence, that senior advisor has a little bit more incentive and skin in the game to make sure that this transition goes well because they’re…
Heather: Yeah, absolutely.
Michael: …literally transitioning some of their existing clients and want to make sure they’re well taken care of.
Heather: The clients they love. That they’ve had for forever, that they have a vested interest in. That they know will be well served by the next generation.
Michael: Can I ask, like, what if the advisor doesn’t want to let go of those clients? Like, do they have to? Is that just part of how the firm works? Like, you have to transition certain client relationships? Or, like, how do you make sure they don’t just hold on to all the people?
Heather: Sure. Not yet. So I think there are incentives, right? So we do…we’re starting to work in the Diamond Team model, so there’s incentive for everyone.
Michael: Okay. That’s the Angie Herbers’ Diamond Team model. Okay.
Heather: It is. It is. So there’s incentive for…in my opinion, it creates the incentive for people to do what they’re best at, right? So you have an advisor who’s been in the business 20 years, typically, they’re at the level where what they do really well is go out and get new business, service, you know, larger clients that need probably the more complex oversight and help with their design.
And so freeing up the capacity of those advisors to be involved in those relationships while still including the next generation so that they’re having the opportunity to learn, you know, and to grow and to see how those relationships are managed, and to see how business development occurs, and to see best practices around dual roles. How do you do both of those things and how do you do them well? It just becomes a capacity issue, right? You have to build the structure into the firm that allows for everyone to do what they are best at because quite frankly when people are doing what they love and they’re doing their best and highest use of things, whatever those things are, the engagement across the firm is much higher.
What Diamond Teams Are And How They’re Structured In SignatureFD [17:57]
Michael: Can you maybe give people a little quick summary of what Diamond Teams are or what that looks like? You know, we’ll put a link out to Angie Herbers’ white paper on Diamond Teams in the show notes as well. So for everyone listening, this is episode 68. So if you go to kitces.com/68, you can get to the show notes, and we’ll include a link out to this as well because it’s some kind of a framework around building advisor teams that Angie did a couple of years ago. But can you talk about a little bit, Heather, or I guess particularly in the context of how you apply it in your firm? Like, what does your team structure look like to support these niches and support these transitions in the development of next-generation advisors?
Heather: Sure. Absolutely. So I think our structure is definitely geared more towards extreme collaboration across the entire firm. It’s also intended to accomplish multiple things. One is we have some extremely liberal benefit packages, and, you know, sabbaticals and unlimited time off. And so there is a need across the firm for people to move fluidly across teams and to be able to step in and support other team members at any point in time. And so our entire firm is structured in that way, to be able to support that.
It’s also intended to be very particular and intentional around career development and allowing for individuals to grow within the firm in the area and manner that they want to grow. And so creating the flexibility for there to be not only technical progression within the firm, meaning you can become a subject matter expert in whatever you are doing, and you can be an available resource to the team or to the firm, or, you know, you can hone your skills and become an advisor. Having the flexibility to have best-in-class and career progressions in all of those areas is critical.
And then Diamond Teams I think really allow for if you are choosing, you know, to possibly pursue the advisor route or to progress in that type of career development pattern, it allows for great mentoring but also great progression. And so if you think about a diamond, typically the top portion, which it’s not meant to be hierarchically top, if you think about a baseball diamond, right?
Michael: Okay. So like second base.
Heather: Yeah. Like, you know, is meant to be that…that position really is meant to be either there is client work, you know, the top 20% of those clients, the super complex, those are the clients you’re working on. And then the majority of your time is either spent developing new business or managing, helping to manage the firm. And so that’s really, you are really responsible for the growth of that team, the development of that team, the clients that are on that team, and then probably have some level of responsibility back to management of the firm in some way, shape, or capacity.
The next two points are really meant to be lead advisors. And so these people are spending probably 80% of their time working on direct client relationships, and then in the other 20% of their time, they’re learning how to develop business. They’re learning how to network. They’re learning how to be part of those larger client relationships. They’re learning how to service clients. And then the associate advisor, which is the other point on the diamond, is really the person who has…they’ve mastered kind of the technical skill at that point, and they’re learning how to do relationships. And so they’re starting to go into client meetings, they’re starting to learn how to present materials to clients, to answer those clients’ questions, and then they help support the other points on the diamond.
Now, in our firm, our diamond teams, we consider them service delivery teams, right? So we may have a SignatureEntrepreneur diamond team. We may have a SignatureEXEC diamond team. Those people are very focused on the specific needs of that community. But we have, we call them hubs. We have a client care hub. We have an investment team hub. We have a planning team hub. And those hubs are where you are sending the work to be done and where people are developing the technical skill that they need or want or desire to either move to a diamond team and become an advisor that way, or that they are working to develop the subject matter expertise, to be a director of portfolio accounting or a director of portfolio management or a director of research or whatever that position may be within the firm.
Michael: So to make sure I understand this. So the diamond teams are essentially like clusters of four. A senior person who’s got, you know, a couple of the highest net worth or the most complex clients, the rest is mostly management and people development, 2 lead advisors that are, like, I guess first and third base if we’re looking at the baseball diamond, who are senior advisors, 80% servicing, maybe 20% of learning business development, and then 1 associate advisor that supports effectively the other 3 bases on the diamond. That’s kind of your classic associate advisor technical support, I guess, like, constructing plans, doing planning analytical stuff because they know their technical skills enough to do that.
And then you’ve got diamonds in each of your communities. So there’s a SignatureWomen diamond, a SignatureExec diamond, A SignatureEntrepreneur diamond, etc. Or even, like, do the big communities have multiple diamonds?
Heather: They will. They will.
Heather: So this is kind of an evolution for us. We’ve been working in the hub structure for a very long time.
Michael: Which I guess is what most firms would call, like, departments. You’ve got wonderful names for all of these things. I love it.
Heather: I can take no credit for any of that.
Michael: You know, like, firms might have centralized planning where the plans get constructed, centralized portfolio trading where that stuff happens, centralized investment team where the portfolio design things happen. So you guys label those hubs. And so you’ve got hubs for centralized areas and then diamond teams for servicing clients.
Heather: Yes. And from an overall global standpoint, the way we like to look at development of team within the firm is at the level one. Level within the firm, you’re really kind of new. You’re getting to know the firm. You’re getting to know our processes. You’re getting to know our technologies. You’re getting, you know, to the point where you are developing your technical expertise.
At level two, you have developed your technical expertise and you’re starting to work on your relationship expertise. And so here you are starting to develop relationships, whether it be with clients, whether it be with external vendors, whether it be with internal, the internal marketplace. You’re really starting to work on your relationship skills.
At level three, you are starting to learn to develop others. And so you’re learning to coach, and you’re learning to mentor, and you’re learning to develop other people and bring other people along through the firm. And then at the director level, you should have mastered all three of those and you are now managing teams. So really, you know, from just a global perspective, that’s kind of how we like to think about career development within the firm.
Michael: So on progression, like, technical expertise, relationships, management. I guess essentially coaching, developing, managing others. So I’ve got to ask, in that progression, like, where does learning to do business development and bring in clients?
Heather: So that really starts to happen at the diamond team level.
Heather: When you pop off of a technical team, you decide, you know, “Hey, I’ve got my technical skill,” right? “I’ve learned the relationship aspect of things, now I think I’m ready to found the initiative that I really would like to be involved with. Now I’m going to start learning how to develop that business.” How to build your centers of influence, how to bring clients into the firm, the sales cycle, you know, what that sales process looks like. You know, and over time, very similar to core values, that story, right? Because it’s all a story. It’s all about, “How do we help people understand what we do and the value that we provide and how we’re able to truly at the end of the day help them make an impact with their wealth?” So that story starts to become natural, right? Those core values, they just roll off your tongue and they start to become the framework with which you make decisions on everything.
Why Diversity Of Thought Leads To A Better Product [28:01]
Michael: So you’ve got all these different communities, these different niches, so, like, the other two questions that come to mind around this, you know, one, how do you decide the next community, right? Like, you’ve got five or six of these now, what defines the seventh and how does that come about? Like, are you…you know, do you have, like, a firm strategic process, “We’ve, you know, analyzed 17 potential niches in the Atlanta metropolitan area and we’ve decided that these 4 are the ones that we want to build out?” Like, how do the niches come about?
And then I’m curious on the other end of like, do you have any worries? What happens if someone running a niche leaves the firm? Like, do you lose the whole niche? Do you have business risk around…I mean, we all as advisory firms have business risk if an advisor leaves, but I feel like you concentrate it when you build a niche around the advisor and then the advisor potentially leaves. So how do you look at the formation of niches and the business risk of losing a person in a niche?
Heather: So let me answer your second question first. So I think as an enterprise level business, I don’t specifically think about the risk as it’s related to a niche, I think about the risk overall. So regardless of whether someone is working in a community or not, I constantly think about and what we try to evaluate is, is the client so connected to the enterprise that regardless of whether it’s the advisor, whether it’s the planner, obviously, yes, the relationship with the advisor is critical, but as an enterprise, how do I protect against that risk of clients leaving in droves? And the way you do that is to have teams involved. And that’s why I think we are so intentional about the design and the platform. And always having teams involved with clients, I think it not only helps mitigate some of that risk, but I think that it also provides a much better experience and much better perspective to the client.
One of our beliefs overall is that diversity of thought always makes for a better product. And so I think just in design itself, when you have multiple people involved in the client, whether it’s the client relationship, whether it’s the strategy of the firm, the diversity of perspective and the diversity of thought always, in my opinion, leads to a better product. And I think that once clients are ingrained in that mentality of having a team attached to them, I think that that’s what helps mitigate that risk.
Michael: And so in essence, you know, if, heaven forbid, an advisor or does leave, essentially now you can go out to the client and say, you know, “Look, you know, over the past year and a half, you’ve interacted with seven people from our firm in various capacities, one of the seven left, here’s the new one person. The other six are still here with you.” And, like, it’s just, “Hey, it’s not a big deal. One of the various people on your team left, not your advisor left. Just one of the seven people on your team left.”
Heather: Yes. “You’re being serviced by SignatureExec. You know, SignatureExec team. Yes, one person left, but the entire team is still there.” And I think that that’s one of the massive benefits of the Diamond Team model is that there’s always multiple advisors or next-gen advisors, you know, involved in any relationship. So that’s the answer to your first question.
Michael: So I guess sort of playing devil’s advocate, I guess that means at worst, if someone is going to leave and try to take clients and impair the business, like, they don’t just have to leave, they have to leave and take, like, their entire team with them, right? Like, someone would have to try to take the whole diamond to actually impact, which I guess is always still a risk. Like, firm splits do happen, but it’s a heck of a lot harder and more complex and lower business risk for the firm when anybody who wants to leave, like, you can’t just go…you’ve got to go and try to bring everyone with you.
Heather: Yeah. And I think the other thing and I kind of say this with a smile on my face, but I think the other way that you mitigate that risk is that you build a firm that nobody wants to leave.
Michael: Sound fair. That’s a fair point.
Heather: I don’t know any other way to say that other than, you know, you make decisions and you build a firm where you want to be. And I think that people start to truly value when your core values are right and your intentions are right and your…as a firm, when you build something where you want to be and other people want to be, I think you have much less worry around people wanting to leave. Because it’s such a great place, why would people want to go anywhere?
Michael: Right. Yeah. I guess there is sort of like an awkward, you know, not trying to throw any listener under the bus, right? But like if you’re really concerned about what happens if my advisor…like, if I build a firm and my advisors leave then maybe the answer isn’t like, “How do we better have better non-competes and non-solicits to keep them from leaving and taking the clients?” and a little bit more, “How do we just make it a firm with enough shared opportunity that they want to be here and everybody grows together?”
Heather. Absolutely. Absolutely.
Michael: Fair point.
Heather: And if there’s a reason that they want to leave then I believe that it’s the job of leadership to figure out why that is and to fix whatever issue there is fundamentally at the core.
How SignatureFD Decides Which Niche To Go After Next [34:01]
Michael: Yes. Like, that’s the risk of leaving, now, like, how do you spin up…or I guess even just, what are all the niches? What are all the communities you have now? And then how do you look at spinning up a new one?
Heather: Sure. So there are many niches. Let’s see if I can list them off the top of my head. So, one of my favorite is SignatureGenerosity, which kind of encompasses our entire firm. SignatureWomen, SignatureEntrepreneur, SignatureLaw, SignatureHealth, SignatureYoungProfessional. One that I love and, you know, has not gotten much attention yet but will in the future is SignatureKids, which I personally love to death. You know, but overall, when you start to think about, “How do we go through this process?”
So several years ago, our CEO came to the leadership team with a book. It’s called “Traction,” by Gino Wickman. And it is a phenomenal operating system. It is an entrepreneurial operating system that very clearly outlines, “How do you run an entrepreneurial business?” And so, you know, we as the leadership team read the book and tried to work through it. I’d say it probably took us 12 to 18 months as the leadership team just to kind of get our brains around it and put the thought and the effort into, “What does this mean and how is it going to change the dynamic around how we meet and how we make decisions.” But when you implement that process, it is intended to be very intentional around defining who you are, what your core values are, what your 3-year plan is, what your 1-year plan is, breaking that 1-year plan down into 90-day rocks.
And then just the process of bubbling to the surface whatever issues your firm may be having and then removing those obstacles in a fairly quick fashion to keep moving forward. And we’ve been really intentional about developing that management process within the firm and really even trying to roll that down through, “Okay, if this is the one-year plan for our business then this one-year plan should translate to the one-year plan for each of our hubs. And then that one-year plan should translate into the individual professional development plans or personal growth plans of each of our team members.” Because what matters to people most, I believe, again, if we go back to the impact by design, what matters to people most is that they know how they’re having an impact and how they’re adding value and how they are making a difference.
And so from a firm level, if you can help people connect the dots between their individual personal growth plans and what they do every day and how that ties back to the one-year plan for their team and the one-year plan for the firm, then people know where they’re connected, and they know where they’re adding value, and they know where to put their intentions in driving everyone, driving the same way to move the firm forward. And that’s exciting.
And so when you talk about, how do we decide which niche is next, I think it’s a combination of that strategic planning process. It’s a factor of, where is the capacity within the firm? And it’s quite honestly, who’s passionate about this?
Michael: So you’ll build a niche around a person who’s passionate to build that niche.
Heather: Well, we’ll build a niche around a community if someone can show that they’re truly passionate about it. And I think that that’s one thing that we have tried to be intentional about over the years is not losing that entrepreneurial spirit. Really creating the space in the canvas where people who are passionate and people who are driven and people who want to grow have a canvas to do that.
Michael: It’s an interesting framing. So I guess in practice, like, if someone is entrepreneurial and passionate around building on a new community direction, they’re likely to have the opportunity to do it with some just strategic overlay from the firm. Like, “Let’s just make sure this isn’t completely off and a not economically viable. You do at least have to have around a passion that in some way, shape, or form touches people who could pay us for our services.”
Heather: Absolutely. But more so than that, I think it’s a matter of, “Does this fit our core values as a firm?” You know, we have four core values: generosity, greatness, gratitude, and growth. Does this strategically align with those core values, and are we at the end of the day making an impact in people’s lives? Yes, of course, there’s profitability and economic sense and resources and, you know, all of those fundamental core business things that we look at, but our main mission as a firm is to enhance the lives of 10,000 families. And we’re at about 1,000 now. You know, we’ve got a long way to go. We feel like we’re just getting started. And so passionate people who align with our core values, who get this impact by design and want to have impact with other communities and are passionate around that, absolutely. You know, those are the people we’re looking for.
Michael: So I’m so fascinated about just the deliberateness of the words and the strategy of the firm, that you’re able to articulate them, right? Like down to, “Our core values are these.” It sounds like the four G’s: generosity, greatness, gratitude, and growth. You have a mission to enhance the lives of 10,000 families, which I’m fascinated by because frankly, I feel like the typical advisory firm, the mission is something to the effect of, “To be the greatest personal financial planning firm that delivers holistic wealth management for its clients.” Or, you know, to…
Heather: Which is not a bad mission.
Michael: No. Like, it’s not a bad mission, but like, I’m sort of like, “Really? Like, you want to build a firm that can serve 100 million people in the U.S. who all have this need?” Like, I kind of feel like you have to give a little scope to this and then sometimes you have to be the best financial planning firm in the Atlanta area.
Like, yours is very…I’m struck by how concrete and specific it is. Like, your mission is to enhance the lives of 10,000 families, right? Like, not 1 million, not everybody in the Greater Atlanta area. You know, just to be awesome at financial planning. Like, there’s sort of a concreteness around, “Enhance the lives of 10,000 families.” Not the least of which that, well, you know, as you said, like, you’re at about 1,000 families now. It’s like, you do have to 10X your firm in order to do that, but, like, that’s not impossible, right? Like, you’re going to give a decent growth rate for another 10 or 20 years. Like, you can hit that number over a achievable…long but achievable timeline.
And so I’m just…I guess I’m just wondering like, where does all this stuff come from for you guys? Like, is this going through the Gino Wickman “Traction” process and their EOS system that helps this? Like just, is one of your partners just really, really good at finding words for things that other people aren’t very good at finding words for and just has, like, deigned all this stuff and it just works? Like, how do you craft with this level of intentionality around what you’re doing?
Heather: I think that’s a great question, and I think it’s one thing that I absolutely love about our firm and the leadership team. And I believe that it goes back to the point that I made earlier, which was you craft a firm where you want to be. You craft a firm that is true and aligned and authentic to who you are as people and your personal core values. And when you find good partners, talented people who are passionate about what they do and you spend the time and the resources and the energy to truly build something lasting and that you are proud of, humbly proud of, I think good things follow.
And so our challenge, right, is to be able to continue with that level of intention. As the business grows and as you have success, and as the business becomes more complex, and as you have more people and you have more clients, holding true to those core values. Ensuring that every decision you make as a business travels through those lenses and that filter, that is the job of leadership. That is the job of the team who guides the strategic vision of the firm. And so we try to be extremely intentional and authentic to that because that’s who we are as people, I think.
Michael: You know, for folks that are listening as well, I really do recommend as well Gino Wickman’s “Traction.” As Heather said, like, it’s a whole real process and structure around how you actually run an entrepreneurial business. And I’ll admit, it’s an area that’s becoming like a pet peeve of mine, I guess, in the industry. That for those of us who build practices around ourselves, there’s lots of content around there. You know, we do some of it on Nerd’s Eye View as well about, like, how to be more personally effective and more productive and try to bring in more clients and be more efficient on what you do. It’s kind of like it’s at the personal level of you as the advisor.
But there’s almost nothing anywhere in the industry that actually teaches us how to be business owners when you’re running businesses that are much larger than just yourself. Where all the stuff of like, as you said, Heather, like, how do you help people connect the dots between their individual growth plans, the one-year plan of their team, and the one-year plan for their firm so they know they’re connected to the outcomes of the business?
Pretty sure if I asked like 100 advisory firms, “Do you do this well?” like, 97% will say no and most of them will probably say like, “What?” I mean, like, just that sort of process around how you try to run your business well is so far from anything we’re ever taught in the advisory industry. We all kind of have to learn it and figure it out ourselves, right? It’s like you read a book about entrepreneurship, that has no connection to our advisory industry, to find out how to actually effectively run a really successful and growing advisory firm. There’s kind of strange gap around that, I think.
Heather: But I think that there’s also brilliance. And this takes me back to, you know, our very first conversation around design. Like, being able to incorporate the genius from other areas outside of our industry into what we do I think is very, very smart, and people can learn a lot from going outside.
Michael: So take us back a little bit around, like, who does SignatureFD serve? Like, what is just the core business model of what you guys do? Are you charging planning fees? Are you an assets under management firm? Like, I know you mentioned $3 billion under management, but not all of us necessarily price that way. Like, just what is the model at the end of the day, and who are you serving?
Heather: I mean, I think the core model right now is AUM, but obviously the business has the flexibility to serve…like, SignatureEntrepreneur, they’re serving, you know, entrepreneurs. And maybe these people are getting ready to sell a business and maybe they don’t have, you know, their assets yet. Maybe we have a retainer with them to allow for us to help structure the sale of their business or whatever we need to do before they even become a client. So there’s that flexibility. Maybe it’s SignatureYoungProfessional or SignaturePro. We haven’t even talked about SignaturePro yet. You know, maybe it is an initial planning engagement where we can help show the value of using our services and engaging with our firm and working with our communities, and then that leads to, you know, an AUM relationship.
We’re also an insurance agency, so we do have, you know, property and casualty and disability and long-term care capabilities as well as a mortgage broker. You know, so being able to offer multiple services to a client in a flexible arrangement that works for him, works for whoever it may be I think gives us the flexibility to work with multiple different types of clients to suit their needs.
Michael: Interesting. So in addition to AUM fees, I guess at least for the bulk of the clients, maybe retainers or things like that for entrepreneurs who don’t necessarily have investable assets yet, you’re also doing insurance work and P&C insurance work. And I think you said mortgage broker in there as well. So, like, you guys are positioning yourselves as a one-stop shop? Like, is that a fair characterization? I mean, is this about being a one-stop shop? Is this just different revenue lines for serving clients? Like, how do you think about this?
Heather: Yeah, I don’t think about it does a one-stop shop. I mean, I guess I could. But I think overall, this was born out of the fact that clients need these services anyway to fully protect, right? Protect is one of the four ways that we work with them and go through the impact by design process.
Typically, financial advisors don’t have these services available in-house, and so they’re referring these businesses out to other professionals, right? And the clients may get good service, they may not, usually not, you have no control over that. And so for us, it’s really about, “Can we better service our clients and give them a better overall experience by doing some of this in-house and having these capabilities available in-house?” And then having, you know, best-in-class products and services, and quite frankly, having experts in-house to help us review client situations to even know what these clients may need. So I think there’s multiple advantages to having some of these things in-house, but overall, it’s about being able to get to the right answer for a client and provide the best experience possible for the client.
Michael: So I’ve got to ask, you know, in an environment these days when there’s so much discussion on fees versus commissions, whether firms are fee-only or not, fiduciary duties and the issues of fiduciary and commissions, like, how do you guys think about that as a firm that’s doing a blend of AUM fees and some commissions, not even just on, you know, like, sort of life disability and long-term care insurance, where I feel like a lot advisory firms are, but, I mean, you’re even into products that not a lot of other advisory firms are when you get into doing home and auto and other P&C insurance and when you’re doing mortgage brokering as well. Like, how do you think about that positioning, or do you have concerns around the future of fiduciary or whether the future is fee-only that may disrupt how you’re doing this business right now?
Heather: I really don’t have concerns. I mean, we’ve never said that we were fee-only. We are fee-based. But I don’t necessarily believe that fee-only advice is conflict-free either. So I think that having conflicts, clearly identifying those conflicts, but having more control over ensuring that the right products or the right solutions are being offered to people, and having some control over the experience and how that is delivered, to me that can kind of be fiduciary as well.
Michael: And are there anything…like, have you guys tried to set any process or structure internally around, like, how do you overview this to make sure that some advisor within the organization isn’t going rogue and making inappropriate recommendations because it is juicing their compensation in some way? Like, do you look at it as a problem that way of like, “We have to oversee our advisors around their conflicts of interests as a firm?”
Heather: Well, I mean, obviously I think that you think about…well, so maybe not everybody thinks about that, but I am the compliance officer, so obviously I do think about it.
Michael: Okay. So that actually is to, you know….
Heather: So I do think about those things, but I think that you build the structure of the firm to address those things, right? And quite honestly, I think that you could think about that from a quality of advice given on a financial plan perspective as well, which is again, if you come back to the structure of the firm and you come back to the checks and balances and you come back to the team structure and having multiple people working with each client who have technical expertise in multiple different areas, I think you end up with a better product, and you end up with a better solution at the end of the day, whatever that solution may be. Because you’ve got diversity of thought, you’ve got diversity of technical skill involved, you’ve got a team structure where there are no silos, right? There is no one person solely giving advice that someone else isn’t seeing or having some sort of input or thought into.
And so when you hire extremely credentialed people and you give them the flexibility to do what they’re good at within a team environment, I think you end up with an organization that kind of manages itself in that regard.
Michael: You know, I think it’s interesting that you frame it around, like, at the quality of advice issue, which isn’t just about, “Did someone recommend a commission-based product as a part of the overall mix that was or was not appropriate?” but just, “Was all the advice appropriate or not?” Of which that just happens to be part, right? Like, ultimately if you’re a firm that’s way beyond the original founders, like, you’ve kind of got to care about what everybody is saying about everything, not just implementation parts.
Heather: Yeah, absolutely. That’s correct. It is not just about this P&C product or, you know, this life long-term care or whatever it may be, it’s about the financial planning. You know, was the cash flow done correctly? I mean, you know, are we looking at the entire client’s situation and understanding it from a technical skill? And that’s why, you know, the level one, just core competency of everyone in the firm is technical expertise. And I think that that just starts to build as you progress. And then you build in the flexibility and the coaching mechanism and the mentoring mechanism, and you just have these multiple layers of kind of ingrained oversight into all the advice that is being given, because I don’t think that it’s a fiduciary…only looking at products and saying that those are the only things you have to be concerned about as a fiduciary I think is short-lived, short-sighted.
Michael: Well, and, I mean, I guess at the end of the day you guys are $3 billion under management-plus. You said you’re at about 1,000 families, already on your, like, a path to 10,000. It’s like, certainly in a world where having all these conversations around fee-only and fiduciary and the rest doesn’t seem to be impeding your growth very much, which, you know, frankly to me, I mean, is sort of twofold. Like, not really to try to pick a fight in one way or other around fee-only versus commission and fee, but simply that to me what really gets framed up by what you guys have done is, you know, you have all of this branding and messaging and focus around, you know, “We’re here to do financial design and we’ve got these communities, and here’s our specialized offerings within the communities.” And, you know, you get that differentiated in what you do, and all of a sudden a lot of those other questions start to fall by the wayside anyways, right?
Like, you know, much love to some of my friends in the industry that, you know, market and push heavily around importance of fiduciary duty and reduce conflicts of interest, and I believe in all of that as well, but while those are good things to be, you know, fiduciaries, to act in your clients’ best interests first, like, it’s not the best way to market.
Heather: Sure. Absolutely.
Why Communication Skills Are Essential For An Advisor [57:04]
Michael: And I feel like there are a lot of firms that are sort of confounded like, “It’s important to act in your clients’ best interests.” But when everybody else is trying to do that as well, it becomes a law. As we actually get to a uniform fiduciary standard for all advisors, like, your differentiator, your entire positioning vanishes.
You know, I saw a firm that…because I end up in a lot of mailing lists for advisors, like, I saw a firm that went through a big rebrand and, like, they put fiduciary in their name, they’ve listed out, like, five differentiators of what they do. And it was all like, “We do financial planning and we’re fiduciaries and we manage our conflicts of interests.” And I’m just like, “Who doesn’t say they do these things? Yeah, like, these are all table stakes things.” And like, not that they’re bad to do. If you don’t do them well then people may notice, but like, they don’t differentiate you.
And if you get good enough at the differentiation of the client value proposition and articulating what you do then suddenly some of these other issues are just not so central. So you’re still going to manage quality of advice regardless of how you’re getting compensated, but your competition mechanism suddenly is not the essential differentiator to determine whether you get the next multimillion-dollar client or not.
Heather: Yeah. And quite honestly, with all of the confusion in the marketplace for consumers, I’m not sure that consumers understand anyway. And so while we as an industry throw around a lot of terms that we think make a difference to us, I don’t know that it speaks to the end consumer anyway. And so, you know, being able to communicate clearly with people around what matters to them, yes, being a fiduciary matters, taking the client’s best interest first every time matters, but is that language what makes a difference to a client in a very muddled marketplace that has just bastardized all of this? I just don’t think it is.
And so we need to be able as communicators and as advisors, which in theory is a counseling, helping-type role, we need to have the communication skills to be able to meet people where they are and communicate clearly around what matters to them and be able to build that rapport and that trust and that confidence to serve them well in whatever they need, their desires and wants, you know, whatever they want it to be.
Michael: Yeah. Well, and again I guess I’m, like, just doing the math, $3-plus billion under management, 1,000-ish clients, like, your typical client is $3 million. Like, you’ve got a fairly affluent, financially sophisticated clientele.
Heather: Yeah. Yeah.
Michael: So talk to us a little bit about your own path? Like, how did you come to this firm and the role? Like, how long have you been at Signature doing what you’re doing?
Heather: So I have been at SignatureFD for 15 years. I just had my 15-year anniversary. Seems like a long time. Seems like a minute. Seems like 40 years at the same time.
Michael: Yeah. So I know the firm was founded in the ’90s, right? So you’re 20 years as a firm.
Michael: Okay. And you’ve been there for 15 years. So how large was the firm when you showed up?
Heather: So we were probably $200 million, $250 million.
Michael: Okay. And now you’re $3 billion-plus.
Heather: We are.
Michael: And how many people was it?
Heather: So we are almost 70 people if you count, you know, we’ve got interns coming and going every once in a while, but about 70 people.
Michael: And what number were you when you joined?
Heather: I think I was number six.
Michael: That’s a quite a bit of change.
Heather: You’re dating me. I feel old now.
Michael: I’m sorry. Not trying to date you. Right? I mean, that’s an amazing trajectory, from 6 employees and $200 million to 70-plus and $3 billion. So what were you doing when you joined?
Heather: So I was a client care associate. I was client service when I joined.
Michael: Okay. So in that sort of classic call it like CSA role, client service administrator role. Firms have different labels for it but it’s kind of the functional job duty. So you joined as a client service administrator, I guess like probably the only one, or maybe one of two, one of two at the time.
Heather: I was two of two.
Michael: Okay, two of two. Yes, because someone else was there first. You were two of two. So, like, what happened from there? Like, what’s the journey from, you know, client care associate number two, right? Not even number one. You’ve got to be number two. Client care associate number two is just like, you know, away team red shirt number two. It usually doesn’t survive the away mission.
Heather: Yeah. That’s right. That’s right.
How Heather Went From A Client Care Associate To A Partner And COO [1:02:24]
Michael: So like, how do you go from client care associate number two to partner and chief operating officer of the firm?
Heather: That’s a great question. So I think that there were multiple factors in that. So when I started with the firm, I had previously done some work as a financial planner and had done that for a couple years and really loved that work but had the opportunity to go help start a business, start a trust company. And the reason I took that position was because I love to create. And one thing that I realized very early on about myself is that being bored, I am my worst person when I am bored.
Michael: You and me both.
Heather: I am such not a good person at that point. So needing the creative outlet, building things I am good at, you know, being naturally able to take a problem or a mess, my OCD, you know, sets in and I’m able to kind of pick it apart and put it back together in a way that makes sense to me. That’s a cleaner, that’s more efficient, that runs more effectively. So building a business from the ground up, helping to do that from a technology perspective, from an operations perspective was just a natural fit for me and seemed exciting. And there was definitely no time that was boring.
So I did that for a couple years and realized that the back office of a bank, a trust company was just not…after the building was done, I was kind of bored again. So I was just not my best person and wanted to really…I missed the client interaction, I missed the…quite honestly, what I missed about the financial planning was being able to see the overall picture, see the overall mess, take it, organize it, find a better way to do it, find a cleaner solution, and to be able to deliver that to the client and make a difference that way. So I was extremely fortunate to find the position at SignatureFD, did what I was good at, which was, you know, client service. Working with people was a great foot in the door. And my intention was to work my way back up to a planning role, potentially to an advisor role.
And we have a very generous tuition reimbursement program. And so I went to the leadership team and said, “Hey, I have this vision. What I have seen so far in the work that I’ve done in the industry is that there’s a lot of dissension around money in families, and there’s a lot of unskilled people that don’t know how to have these conversations. And so I’d like to go back to school at night and get my master’s in professional counseling because I think that this industry will evolve to where professional counselors will be needed or desired to be able to help these families, have these conversations.” And, you know, I just credit our leadership team, the founding partners of our firm with so much. I mean, just their vision and their leadership and their direction and their…they were like, “Yeah, absolutely. That makes sense. Go get your degree.”
So I did that for two years and at night. And the mantra at our firm has always been, “Master the job that you have and replace yourself and then opportunity is boundless to you.” And so that was just what I did overall. It was like, “Get in there. Figure out what you’re doing. Do the best you can. Master it. Make it better. Find someone to replace yourself and move on to the next thing.” And so I was extremely blessed that there were just opportunities all over. You know, the firm was growing quickly. I helped in the mortgage division for a time. I helped in the insurance division for a time. And what I didn’t realize that I was doing and was afforded the opportunity to do without even realizing what was happening was just to learn the business. You know, all aspects of the business from the ground up. It was, “Why we do this. How are we doing this? How can we do it better? You know, what is the benefit here? How does this benefit the firm?”
And so I kind of say all along that I was just kind of that squeaky wheel because I was always asking for, “What can I help? What can I do? What can I do? What can I do?” And I know they got sick and tired of me asking. And so it was like, “Here. Just go work on this or you can help here.” But because of that and because of the things that they were doing at that time, you know, I was able to be involved in…we had multiple consultants that we were working with that allowed for business stuff. I mean, it was all, “How are we structuring the business? How are we thinking about the business? What are our core values? You know, how are we going to structure our teams?”
And so very early on I was allowed insight into the business itself and how the leadership team and the founders were thinking about the business and how they were making decisions about our trajectory and our growth. And they, you know, had such full books at that time that they were getting to the point where they needed help rolling off some of the additional things that they were doing, that they weren’t best and high issues of their time.
And so it was just a natural progression of things that I was just naturally gifted at. My skill set is just operations. It’s organizations. It’s being able to see a mess and clean it up. And then my passion, which when I, you know, got my counseling degree, just my natural passion is around the development of people, around good communication skills, believing that, you know, most conflict can be resolved well when people are committed and dedicated and skilled at it. And so I truly believe that learning those skills and bringing those skills to the business helped facilitate some different types of growth on the management side of the house and the leadership side of the house that I was just fortunate to be a part of.
Michael: It’s quite a story to me that you have just of…I don’t know, like, the thing that jumps out to me is just the sheer level of initiative that you had through a lot of it. Like, you went and pitched the leadership team about getting your master’s and then you went to do it for two years at night while you’re working full-time. You know, having just like, “What can I do? What can I do? What can I do?” attitude that just I love to hear it. And maybe this is my bias because I’m an entrepreneur type that likes people who have initiative as well. That just, I don’t know, there’s a very like, it wasn’t handed to you. You just went out there and kept doing things and getting them done. And when you get a lot of stuff done, you tend to rise up in a growing organization. I feel like sometimes we make the formula out to be more complex than it actually is.
Heather: You know, sometimes I think that…so I think that I was a non-traditional talent. So, you know, I grew up in a home that we didn’t have a whole lot. A lot of love but not a whole lot of, you know, resources. And you just worked. I mean, it was just what you did. And so, you know, I went to school and I worked full-time and worked through school. And so working was just…it was just what you did. And so I think that mentality and that need early on, I have this insatiable need to learn. Just everything is interesting and so I just want to keep learning more. My husband laughs and said I could be a lifetime student, which I could because I just think things are fascinating.
But I think that, you know, if you have looked at my resume, and I see a lot of resumes now and I think about us as an industry, and it’s crazy to me how the industry has evolved so much that when we look at our resume, we’re looking at, you know, “Did you go to the right schools? Did you graduate in the right financial planning program? Did you have, you know, the right internships?” And I didn’t do any of that. Just a complete non-traditional talent. And sometimes I wonder if as an industry when we start to talk about women and we start to talk about diversity and inclusion, you know, I think that we could learn a few things as an industry around what non-traditional talent has to offer our firms and our industry as a whole. And that not everyone, you know, has the ability to go to a great school or to not work or to have, you know, the best internships or to be at a school where there’s a great financial planning program.
And all of those things are amazing things and I am constantly amazed by the talent that I do see come across my desk, but I do think that when we start to talk about diversity and inclusion, which is an important conversation to have in our industry, that we need to figure out a better way to look at the non-traditional talent and those other people and to include them and maybe have other programs to get them the training that they need because they have…you know, I was one of them. I mean, they have good talent to add.
Why The Firm Uses An Industrial Psychologist As Part Of Its Screening Process [1:12:26]
Michael: Yeah. You know, it’s funny, we did an article on the site recently that Derek Tharp did all around this whole bunch of research now that’s coming out and raising the question of, like, how much of the value of college is the things that you learn and how much of the value of college is just that it’s a useful signaling indicator for employers who are trying to figure out how to determine who’s a competent student and who’s not. So one of the ways they do that is they just look at who went to a good school, because it’s like, “You know, the school did a screening process when they got in and graduated. So that makes my job easier in screening.” And, you know, there’s actual, like, economic research validity to that signaling theory framework.
But the flip side of that is that means if you do want to I’ll call it, like, identify non-traditional talent in general, and especially if you’re trying to identify non-traditional talent and supporting diversity initiatives, I feel like the struggle point that a lot of firms get to, though, is, “Well, then how the heck do you evaluate them? You know, if you’re going to tell me that all my traditional talent development parts and tools are broken, then, like, what the…am I supposed to use to figure out who’s actually going to be good at the job when they come in?”
Heather: Yeah. I think that’s a great question. And one of the things that we incorporated years ago into our process of evaluating talent is an industrial psychologist. And so every potential candidate for our firm goes through a half-day process with an industrial psychologist who knows our firm very well and does a lot of work with our leadership team. Who knows, you know, how we do business, what our core values are, how we function as a leadership team, knows us as individuals.
We send people to that industrial psychologist because one thing that we don’t want to do, and, you know, we will be humble enough to say it is, in an hour or two meeting with someone, it’s very difficult to adequately evaluate the skills they may or may not bring to the table. And so it is, we believe, an investment, and again, one of those things that we want to be extremely intentional about because the culture of our firm is something we love and our team loves and something we want to be very protective of. And so we want to be sure that we are making good hires. And so we decided, “You know what? It’s important enough to us to go outside of ourselves.” We trust professionals in this area. And so that’s one of the ways that we do it.
Michael: Can you talk to me about this a little bit more? Help us understand, what is an industrial psychologist? Because, you know, I feel like for most of us, like, psychologist equals shrink equals therapy or something to that effect. So, like, they don’t even work for you yet and you’re sending them to therapy.
Heather: Which I love all of them.
Michael: Yes. Amen. Like, not to knock them all, but, you know, the whole like, “If you want to work for us, first you have to go to therapy” sort of feels weird. So what is an industrial psychologist and, like, what are they doing in this half-day screening process?
Heather: So an industrial psychologist is someone who specializes in understanding how individuals fit into a system. So if this system is our firm, their job is to know our firm, to know our industry, to know how we do business, to know our culture, to know how we manage, to know our leadership style, to know the expectation of success, to know what resources we have available or don’t have available to help manage people or not manage people. So their job is to understand our system, and then their job is to get to know the candidate and evaluate that candidate’s success, potential success within our system.
And so there is an interview process. There’s about two hours that is spent just talking to the doctor, who knows our business, and then there’s an hour, hour and a half of testing that’s done. And this is just there’s…
Michael: And what kind of testing?
Heather: Yeah, it’s logic testing, reasoning testing, aptitude testing, really nothing specific to our industry at all. It’s more around, how do you work? How do you think? How do you evaluate criteria? Deductive reasoning. Really just more around how you function as a human. What biases you have and how you would take all of that and insert it into our organization. And quite frankly, what comes out of that most of the time is, “Hey, SignatureFD, in order for this person to be wildly successful within your firm, here are the resources that you would need to be sure this person has available to them.”
Michael: And it’s fascinating. This sort of feels like a…like, is this another way of…it’s like a recruiter? Is that a fair way to think about it or they’re not really recruiting because you’re going and finding the people. It’s more like a screener?
Heather: Yeah, I would say so. So typically, when we are looking at candidates, typically they’ve come to us, you know, multiple ways. I mean, we have multiple opportunities for people to come to us. But typically what will happen is they will meet with a couple people on the leadership team. Meet with myself, meet with, you know, usually one or all of us on the leadership team, and then we’ll get multiple other people on the teams involved. So what we really believe is that you could talk to people on the leadership team all day long and I could sell you on SignatureFD with, you know…
Michael: I suspect you’ve probably sold a few people on SignatureFD just listening to the program once you got to, like, these sabbaticals and the unlimited time off. Like, there’ll probably be a few people on that SignatureFD careers page after that.
Heather: No, I could sell you all day long, but what really matters is that you talk to the team members, right? What matters is that you have the face time with the people who are actually here living it, breathing it, doing it day in and day out. Because don’t just take my word for it, like, you need to understand that this culture permeates every single person in this organization. And so we will spend extensive time with a candidate on the front side. And then if we all, you know, kind of come to the consensus that, “Yeah,” that we believe this person could be a really good fit for whatever position we have available, then they will go visit.
Michael: And can I ask, like, what do you pay to…like, do you keep this person on retainer? Do you, like, pay them every time you send a candidate out to them?
Heather: No. Well, we pay them every time we send a candidate. And the funny part is that we had been working with one psychologist for, gosh, as long as I’ve been here, and he recently retired. So we, you know, went through the process and found another one. And so as a leadership team, we said, “You know what? We don’t want anyone to go through this process that we haven’t been through ourselves.” So as a leadership team, we all went back through the process. We all went back through the screening, and we found that there was immense value as a leadership team in having this person come through and not only evaluate us as individuals but evaluate us as a team. You know, y’all been working together for so long, you’re kind of like family. And you have these communication bias things going on. And every time someone says something, you’re going to say something. You know, and so being able to have an expert come in and just refresh us on all of that as a team was valuable. But not asking anybody to do anything that we wouldn’t do ourselves.
Michael: And so can I ask, like, do you pay them like…is it like a couple hundred dollars every time they do a screening? Is it like a couple thousand dollars so you really only put them late in the process?
Heather: It’s between about $1,000 to about $1,200.
Michael: Okay. So, you know, for a person that you’re going to hire for many multiples of that hopefully for many, many years to come, like, not an unreasonable investment when you look at it from that perspective.
Heather: No, not at all as the intention around being sure of the people. And quite honestly, they’re getting feedback as well. You know, so they get feedback directly from…a lot of people have never been through a process like that. So, you know, being able to get some feedback directly from the professional around, you know, “Here are some things you could work on,” or, “These things are really awesome,” or, “You know, you’d be really well served in organizations like this or you could use some training in areas like this,” you know, proves valuable to them as well.
Michael: Can I ask you who you guys are using? Like, is this someone you would recommend that other firms try out?
Heather: Yeah, I love it. We use the Management Psychology Group in Atlanta.
What A Lifelong Learner Can Do To Improve Themselves On A COO Track [1:22:07]
Michael: Management Psychology Group. All right, we’ll make sure we have a link too out in the show notes for people who are interested in maybe checking it out or trying out the process. So again, this is episode 68 with Heather Fortner. So if you go to kitces.com/68, we’ll have a link out in the show notes for this as well.
So, Heather, I’m curious, like, you said you’re a lifelong learner, you know, you went back and got your master’s in professional counseling early on and then you ended out I guess in a…you chose to go the more operations role instead of actually going back in the advisor direction. So, like, what’s lifelong learning for you now? Like, what do you do to improve yourself on the COO track?
Heather: That’s a great question. So I was fortunate enough, and I hope you laugh when I say this, but I was fortunate enough to become the CCO as well…
Michael: Excellent. COO and CCO.
Heather: …in 2005.
Michael: So, like, you really…yeah. Okay.
Heather: I really love to solve problems. I really do. So, you know, I did get the IACCP designation for compliance professionals from NRS, which…
Michael: That’s like Investment Adviser Compliance Professional?
Heather: It is. And it was a great program that really kind of helped launch my compliance career because coming in… You know, I don’t know that many people grow up thinking, “You know what? When I grow up, I want to be a chief compliance officer.” I’ve not met one. But if you are going to be one, I think being very well educated and, you know, continuing your learning in that front is extremely important. And so I would highly recommend that designation.
But, you know, I’ve been extremely fortunate again, you know, SignatureFD as a whole, we just believe in coaching. We believe in mentoring. We believe in professional development. And so in 2015, I did the Schwab Executive Leadership Program. And then I just graduated from the G2, the second…or the first class of the G2 Leadership Program as well. And so both of those have been, you know, just fantastic professional development for me as a leader.
Michael: Can you talk about those and what they are? Because I’m not sure very many people are actually familiar with those programs.
Heather: Yeah. So the Schwab Executive Leadership Program is a year-long program. It is based on module learning. So I think in our cohort, there were probably 50 of us. And it’s broken into 10-week sessions. And in each of those 10-week sessions, there’s 5 of them, you go through…there’s online learning. You start with a capstone where you all fly out there and you meet everybody in the program, and then you go through these five modules of online learning where you’re doing things weekly and you’re, you know, meeting with your groups weekly.
And then you have, at the tail end of that 10 weeks, you meet with a coach who’s helping walk you through your own personal stuff and stuff that you’ve got going on in your firm. And then you start another 10 weeks. And each 10 weeks, you’re paired with a different group. So you’re really getting to know everybody in the cohort by the end of that 10 weeks. And there’s online learning from, you know, Wharton and great schools all around leadership and development and marketing. And, you know, things that, you’re right, the industry doesn’t necessarily teach us to do.
And I think the best thing for me that came out of that program was the study group that I’m now a part of. And so meeting and spending time with other next-generation leaders of firms in our industry and having that study group to now interact with and bounce ideas off of, and, you know, we meet twice a year in person, that was just amazingly beneficial. So that was one. That’s the Schwab program.
Then I was fortunate to be a part of the G2 program, which is Fidelity and Philip Palaveev. And that program is a two-year program. And what I love about that program is that you are assigned to…so we had a team of five, and there’s probably around the same amount in the total cohort, but you get assigned to a team at the very beginning and you are with that team throughout the entire two-year process. And you meet four times in person, twice each year.
And you get assigned a company. And your company has a case. You have profile and you have a P&L and you have employees, and you come right with your own firm issues and your growth issues, and really, you know, you get your own firm to manage. And then out of that, you end up with these case studies of, you know, “Here’s what’s going to be expected of you and your team to come back with.” And so you have to go through the strategic planning process and you have to come up with a mission and a vision and an executive summary. And you have to come up with a plan of how you’re going to address these issues.
And I think the most interesting piece of it all is that the financial aspect of how to run a firm and the implications that your decisions will have on this firm are judged. And there’s a panel of…you know, Tim Kochis is one of the judges on the panel. And you’ve got this panel of industry thought leaders and business leaders who are then judging your presentation and your solutions to these problems and how you’re going to address them. And they’re judging your business writing. And they’re judging your decision making. And they’re judging how well you present your findings and your decisions. And how accurately are you reviewing the information for detail? And, you know, are you considering the cultural implications that your decisions will have? All of these things that are so true into what goes into running a business.
And then your next case study after you get the scores of that, your next case study takes into account the decisions that you made in your first year.
Michael: So you have to leave the firm.
Heather: Yeah. So it’s just fantastic to be able…you know, you get two years with people. I’ll say, you know, they’re very intentional about who they assign groups, to the groups. And so I was paired with some amazing thought leaders in our industry. And the things that I learned, you know, some of them had much more extensive M&A experience than I could have ever had or had exposure to just in my position. Some of them had extensive cultural understandings and how things were being done in their firm. Some of them had extreme financial knowledge. You know, they were financial engineers.
And so how all of these people thought about the business and the things that they would see when they read the case study versus the things that other people would see when they read the case study, you know, it was that diversity of perspective and the diversity of thought. And it taught me a lot about how to look at businesses differently, how to think about them differently, and quite frankly, how to network. How to build a support network of really smart people in this industry, because you’re never going to have all the answers and you’re never going to have the same experiences or access to all of the same experiences that everyone else has. And so having a very strong network of professionals in other great firms across the country is just such a benefit. And that’s what that program taught.
Michael: So for people who are listening to this and going like, “I want me some of this education. That sounds pretty amazing,” I mean, how do you get into these programs? Like, can anyone just go online and look up Schwab Executive Leadership or G2 Learning Institute and just join or, like, do you have to apply or does someone nominate you? Like, how does it work?
Heather: You have to apply to the G2 program. I was nominated for the Schwab Executive Leadership Program. Typically, the leadership team of your firm will nominate you for that. There is a financial component to both of these, so it is an investment. And, you know, again, I was extremely fortunate that the SignatureFD wanted to invest.
Michael: Is that like thousands of dollars, tens of thousands of dollars? Like, what do you have to…?
Heather: No, it’s not tens of thousands of dollars, it’s thousands of dollars.
Heather: But, I mean, probably on the lower end of the thousands than the higher end of the thousands.
Michael: Okay. So, I mean, there’s a financial commitment, but…
Heather: Yes, absolutely.
Michael: …if you’re on a track to be a partner of a sizable firm someday, like, this is a really reasonable investment in the long grand scheme of things. Yeah.
Heather: Absolutely. And not only that, but you can either go…what are your other options, right? You can go and get an MBA and get some generalized experience, or you can fast-track it through one or both of these programs and get some very, very specialized knowledge and experience in our industry, you know, rubbing elbows and making connections and friends with other leaders in our industry. I mean, to me it’s a no-brainer.
Why Value Creation Is A Better Focus Than Revenue Production [1:32:35]
Michael: So where did the part come in where you actually became a partner? You crossed this line that not many people cross in general. Just, “I’m an advisor in the firm and someday I hope to make partner.” It’s even less common in roles in the operations side of the business, and unfortunately, even less common for women, at least across the industry in general. So, like, how does a non-advisor female get to the point of making partner? Like just, it’s not a common thing.
Heather: You know, so I don’t think the issue…I don’t know that the female part of it, and this may be just more around, you know, how progressive our leadership team is. And I don’t know that there was ever any issue around my gender. I think the issue that had to be addressed was one, you know, yes, we are a service business and typically in service businesses, the model has always been that “revenue-producing” people are the ones that become partners, especially the fact that our firm was born, you know, our founding partners came out of a CPA firm. And so when you have that model of…that you come out of, right? Professional management, the COO operational-type position, in a lot of service firms, especially in our industry, management still has client books of business. But that it was just not where I wanted to be, and it was not where my skill set excelled.
And I think that the leadership team recognized early on that there was value in having someone…the business is my client, focused on the business, and then that discussion. And I think that word “value” is critical because then the discussion became around value creation. “And how do we reward? What are those things, those expectations of partners? What are we looking for out of partners? And how do we measure value?”
And so the discussion was never really around revenue-producing or not, it was around value creation. And that is a language terminology and an idea that I would like to change in our industry as a whole, because I believe that there are a lot of extremely valuable people that firms will need, especially as our firms mature and grow, who add an immense amount of value, whose highest and best use is to not be in front of clients and to not have those client relationships, but they can offer immense value to the business itself.
And so, you know, I think it was just an evolution over time. It was a lot of discussions. It was, some of them were extremely skilled, some of them were unskilled, on my part. You know, there was a maturation process that I had to go through as a leader, as a human being, as… You know, nobody really teaches you to lead, right? You do the best you can and you fail miserably three-quarters of the time. And then if you’re really lucky and fortunate and blessed and work with great people who are committed to helping you, you may win every once in a while.
Michael: Yeah. And they’re all learning experiences.
Heather: Right. Absolutely. But you become better because of that. And I think that one thing that SignatureFD as a whole is really good at is that we just treasure mistakes. Because if you’re making mistakes, you’re trying and you’re growing and you are developing. And at the point that that stops, I believe that innovation stops, and that’s when firms stagnate. And that’s when firms don’t grow and they decline. And so I think our mantra has just been, “You know what? We’re committed to our firm. We’re committed to each other. I get it wrong a lot, you get it wrong a lot, but together we get it right a lot more than we get it wrong. And you bring value to the table and a skill set that I don’t have, and I bring value to the table and a skill set that you don’t have, but together they make a really powerful skill set.”
And I think that as a leadership team, you know, I’ve just been so fortunate. Our founding partners saw that in me. They invested in that in me, and they tolerated me. And you know that goes both ways. I mean, it really was…sometimes I joke and say, you know, I’m the sister they never wanted and they’re the brothers I never wanted. And it just worked. I mean, it was a lot of really hard work, but there was a lot of commitment and a lot of intention. Again, you know, I keep using that word, but we were intentional about making it work, and we were intentional about being good at it. And so we did the work that we needed to do as people, and we did the work that we needed to do as leaders to try to arrive at the best.
And that work never stops. You know, that is an ongoing…as the business evolves, so do our roles, so does the discussion around, “Okay, we crossed the bridge of, you know, a value-creating partner who doesn’t work with clients with Heather, now how do we translate that down into other partners, you know, as well as the business evolves?”
Heather’s Advice For People In An Operations Role Who Hope To Be A Partner [1:38:33]
Michael: So in that context, like, what’s your advice for others who are maybe in this…you know, they’re in an operations role, either, you know, fairly senior or getting senior. They’re hoping to at some point be recognized as a partner at the firm, but as you said, like, most firms, right or wrong, like, just the historical culture is partnership is for people that produce revenue. I guess because at the end of the day revenue production is a really straightforward way to identify value creation. So, like, what’s your advice to people in the operation side of the business who want to make this jump and are having trouble doing it in their firm?
Heather: Well, I think my advice is the same whether people are in the operations track or whether they’re in the planning track or the investment track, wherever you are in a firm I think the first piece of advice that I would have is, are the firm’s core values consistent with your own? Because if the firm’s core values are consistent with your own then I believe that you are in a place where making the commitment to partnership is good. Nobody wants to be a partner in a bad place, or in a place where you feel like you aren’t valued, or in a place where there’s a misalignment in core values.
And I believe that if firms are committed to good core values then more likely they are open to discussions, which are in my next, you know, couple of points, which is communication skills and being able to do conflict well, whether it’s outright conflict or whether it’s simply being able to manage tough conversations, crucial conversations. You know, the book around “Crucial Conversations” is a crucial book.
Michael: We’ll include a copy of that in the show notes as well. It’s been recommended a few times on the podcast.
Heather: Yeah. I think the communication skills there are critical. And I think that those skills require a certain amount of self-awareness that some people don’t have. And so to me, doing the work on yourself, whatever that may be, is critical. I needed to know that I’m my worst person when I’m bored. I also needed to try a lot of different things because I needed to know what I didn’t like versus what I did like.
I also needed to know what my natural skill set was and what I was passionate about. Because I do believe that the intersection of those two things, when you are naturally gifted at something and you are passionate about it, that sweet spot, that is where you would operate day in and day out and never get paid for it because it is what you love to do. And I think that when people do the work to figure out what those things are, you are much better able to say, “You know what? Is it partnership that really matters to me or is it doing what I love and doing what I’m best suited to do? And let me find the right firm to do that. And then to me, partnership would be a natural evolution of that.” Rather than trying to force something that’s not.
I think the next thing for me would be understanding partner expectations. Most firms don’t have that clearly laid out, but I think if you can help facilitate that conversation, people can start to put pen to paper. And, you know, that’s around career tracks and development. And sometimes there’s just not the capacity, the leadership team just doesn’t necessarily have the capacity to think about that all on their own, but they’re not closed to having those conversations. They just need help finding the capacity to do it.
But I think the mindset there is, I needed to think like an owner. I didn’t just deserve day one to come in and be offered partnership. I needed to understand. I needed to sit on the other side of the table and understand the personal risk and the personal sweat and the personal tears that they had poured into building this company, and to feel that and to own it and to operate as if the company was my own.
And then that drove a commitment to know myself better, to perform better, to develop better, to have conversations that I was probably really unskilled at to start with, to pound out results. I mean, I think results matter, right? Doing hard work and putting in the time and having the results, but doing it, and this speaks volumes for me personally, with a humble attitude. You know like I wasn’t doing it to toot my own horn, I was doing it because I was aligned with the core values and I believed in the greater good. I wanted to make a difference. And that to me, yes, partnership mattered, but it mattered because it was a manifestation of everything else. I knew that it was the place that I wanted to be long-term, not just to attain the title of partner.
Michael: And, you know, I’m cognizant that you said that, at least for your firm, like, the blocking point wasn’t around being female, it was kind of resolving the non-revenue-producing dynamic.
Michael: But I guess I’m just wondering more broadly, like, I still will look out at the advisory industry, 23% of CFPs are female. I’ve never seen good data on it, but I’m quite certain we can say the percentage of those who are owners and partners in firms is even lower than the 23%. Like, it’s not a representative sample all the way up the line. So I hear you that it wasn’t around gender, yet we have this massive gender imbalance in this industry and a worse gender imbalance at executive leadership levels in firms. So, like, where do you think the gap comes from then?
Heather: Sure. Sure. And quite honestly, I don’t think that it’s just gender, right? It’s diversity overall. And I think that, you know, Kate Healy and TD Ameritrade spend a lot of time speaking about that specifically. But if you’re asking me to speak to the gender issue itself, I do think that it’s a couple of things. I think that one, women traditionally have harder decisions to make around their children.
You know, I have a 15-month-old at home. I am extremely fortunate, my husband works from home, you know, so I’ve got an amazing support network. And when she’s not, you know, at her school or with me, she’s with him. And so I’m comfortable with that. I am so much more sensitive now to the fact that a lot of women do not have that same type of support network, and so I think that they end up having to make harder decisions around exiting, even exiting the workforce or the time commitments that are required to put in the type of work that industry traditionally says is required.
Now, I think one way that the industry can get around that, and one thing that I love that SignatureFD does is that we have extremely flexible work schedule. We have work from home. Everybody gets to work from home one day a week. But our technology system is of the caliber that you can do whatever you need to do from wherever you need to do it. And so, you know, as a firm, recognizing that the female workforce is extremely valuable, extremely loyal, extremely dedicated, but sometimes building in that flexibility has allowed us to tap into things that some other firms probably haven’t been able to tap into because they’re not open to those types of investments. And, you know, I think that that’s a shortfall on their side because I think they’re losing out on great talent because of that.
I think it’s also another large part, and this is where I will continue to say, I was trained as a professional counselor and I still had a…I did a really bad job with a lot of conversations communication skills. Women typically don’t speak up.
Michael: Because you were too blunt or you weren’t blunt enough?
Heather: So I’m an extremely passionate person. And here’s what I’ve learned. And I learned this probably more so in my marriage and it translated over into business is that men typically, they can’t hear what I’m saying because of the passion surrounding the words. So if I’m able to dial back the passion and speak more logically, you know, they’re better able to hear what I’m actually saying. And so for me, I, you know, had to institute a 72-hour rule like, “Okay, you know, let me wear out the emotional side of this and then come back with just the logical or the argument or whatever it may be side of this because I will be better received and I will communicate more clearly when I’m not, you know, as passionate about whatever issue it may be.” So, you know, for me that was part of the learning process.
But then I think just having the confidence to have those discussions and realizing that disagreeing is okay, not seeing eye to eye is okay. You know, having multiple of those conversations. Sticking up for yourself, asking for more. You know, typically the research is showing that women are much less likely to ask for something if they need it. They’re much less likely to take a promotion position if they don’t feel like they’re qualified, whereas men will typically take the position and figure it out in the position, in the role. You know, this is just all research from some of the women’s boards that I’ve been a part of.
I think that the confidence to have those crucial conversations, I think that’s a skill set that people need to learn. And I think that typically, women are underdeveloped in those skill sets when it comes to themselves. Typically, they’re really good at having those conversations for other people, but they’re not really good about having them for themselves. And so that’s a skill set area that I think that they can…we as a whole can improve on.
Michael: Well, and I’m struck by that because, you know, as you kind of mentioned for some of the dynamics at the beginning, like, you don’t come across as someone who’s quiet and not willing to assert for herself, right? Like, you were what? Like, a year…
Heather: That is a very nice way to say that.
Michael: ….a year into the firm and you went in and said, “I want you to help me get my master’s degree?” Like, you’re not quiet on these things. Like, if this feels like a challenge for you, where does that leave most people?
Heather: Yes. So the funny story that I tell, that I will never forget, and I’m sure our CEO will never forget either. So I was probably, I think I’d been there two years, and put together a job description of the job that I wanted. And it was the COO job. And I put together this whole job description and I took it, and I laid it on his desk and I said, “This is the job I want.” And he took one look at it and he said, “That’s my job.” I said, “I know.” It took me 10 years to get there.
Michael: Well, it took him 10 years to figure out how to get out of the way of the bull coming at him.
Heather: Right. Right. That’s why I laugh sometimes. It’s like, “Yes, I was just that chirping voice that just nagged at him constantly. You know, and would I recommend that to people today? You know, probably not. Like, I did so many things wrong, but these guys, you know, they were just…they were entrepreneurial-minded enough to realize that even though I was non-traditional talent and probably not as skilled as I should have been, that, you know, there was a value to add there. And so they worked with me.
And you know what? We grew up together. Like, they were maturing in the business, they were maturing as business owners, I was maturing as, you know, a next gen. And good, bad, ugly, and different, awesome, we started to work together as a team well. And I just…I credit their vision. I credit the growth of the firm. And I think that’s the other thing that’s critically important for people who are looking to become partners. There is an abundance of opportunity in growing firms. And if your firm is…one of your core values as a firm is not growth then I would caution anybody to want to be a partner of that firm, because there is always opportunity in growing firms.
Michael: That was one of the things that certainly struck me for my career trajectory as well, that I had no appreciation of at the time. Like, honestly, I landed in a rapidly growing firm out of dumb luck 15 years ago. I didn’t know it was the thing to look for or even how to look for it. You know, now I tell people it’s one of the primary things to ask when you’re interviewing at a firm that you went from employee 6 to employee number 70, so literally, 90% of the jobs that are opportunities in the business today did not exist when you showed up. So to say like, “Here’s where I want to be on the org chart,” or, “Here’s where I want to go,” like, the irony in small firms that are growing rapidly, like, it’s almost impossible even to vision out what those jobs look like because the firm will change so much when it grows by literally 10X the way that you have.
You know, I know there’s a famous saying in Silicon Valley that’s like, “When you get an opportunity to get on a rocket ship, you don’t ask what seat you’re going to be in.” You just get on the rocket ship and figure it out later.
Michael: Right? Like, if you get an opportunity to be in a rapidly growing firm, don’t spend so much time worrying about where you’re going to be or whether it’s the ideal job, detailed description structure in day one. Like, just get a seat on the rocket ship, there will be plenty of opportunities over time to find the seat that you want that’s right for you. Because when they’re going to add…you know, when they’re going to 10X the number of job descriptions, there will be lots of opportunities to find your ideal job in that firm.
Heather: The only job description or the only position that I’ve ever had in this firm that was available was the very first one I had. Everyone has been created as the firm has grown. And I think that the willingness of people to not have to live in a box, you know, and I think that some people like boxes. And as older firms, you know, grow and get bigger and mature, there will always be a place for people who like very well defined job descriptions, very well defined…you know, those things are extremely important. I’ve never liked being in a box. So, you know, I was willing to just do whatever I needed to do because it was interesting and I was learning something.
So I think some of that flexibility combined with looking for growth and being okay with a little bit of non-structured, you know, just being flexible and open to what may present itself is also good for people’s career trajectories.
Michael: So as we wrap up, this is a show about success and successful people, and one of the things I’ve long observed is that success means different things to different people, sometimes it means different things to us at different points in our own careers. So, you know, you’ve had I think what anybody would objectively call, like, an incredible, successful trajectory in the business and, you know, growing to a COO level and a partner level, where that’s still not done a lot in the industry. But I’m just curious for you at a personal level, like, how do you define success going forward from here?
Heather: Well, that’s a great question. I am a very goal-driven person. And, you know, it was interesting. So I’ve been extremely fortunate, and I’ll keep saying it over and over again, just very, very blessed to have the coaches and the mentors that I have had over my career. And I don’t operate well without a goal.
And with the story I just told you, you know, it was like, I took that sheet of paper and I put it on Jeff’s desk, and I was like, “I want to be the COO.” And 10 years later it was like, “Okay, you’re the COO.” And it was almost like paralysis for me because all of a sudden, like, it just never dawned on me that that would actually happen as just, “Put your head down and just work.” And then all of a sudden I’m there, and now I don’t know what the next goal is. And his advice to me was, “Breathe. Just breathe for a minute. Like, just sit back, do what you’re good at and breathe for a minute.” And that minute, I learned to be appreciative and to be present, and to realize…you know, just to give gratitude for just how fortunate I have been.
And so, you know, the next conversation is around, “Okay, what does true leadership look like and what are the things that you need to develop as a leader?” And so I think for me, you know, there’s a mind shift around…Jeff and I were just talking about it the other day. Me personally, it is a mind shift around, man, sometimes when I look in the mirror, like, I still think about myself as that kid, you know, that started…like, it’s hard to see the same thing that other people see.
And so I think success for me personally will look like having the opportunity and the platform to help the people that were like me 15 years ago. You know, I think about if I had had some type of me 15 years ago, maybe it wouldn’t have taken me 15 years to figure some of that, or maybe I wouldn’t have had some of the hard knocks that I did have just from getting it wrong. I have been extremely blessed, but if I can help make that journey easier for someone else like me or I can help develop the skills in someone else that will help bring diversity and inclusion and valuable perspective and leadership into this industry, you know, that will be success for me personally.
Michael: Well, very cool. I hope maybe we get a few people listening to the podcast here who are where you were 15 years ago and get inspired a little about the journey and the opportunity and maybe a couple of lessons learned already that they can spare themselves some pain on in the coming years.
Heather: That would be really cool.
Michael: Well, thank you so much for joining us on the “Financial Advisor Success” podcast.
Heather: Thank you. It’s been a fantastic conversation.