Over my roughly 300-year career observing the financial services world, I've discovered that the very best advice about succeeding in this business comes from people who have worked closely with hundreds of advisory firms. I'm going to share the insights of two of them here.

I'll start with Tracy Beckes, who has emerged as the business coach who seems most consistently to foster impressive life changes and positive results from planning practitioners. Beckes has an MBA from the University of Oregon and once co-led the coach training program at the prestigious Hendricks Institute in Ojai, Calif. I recently interviewed her for my newsletter, and she offered her insights on what she calls The Essential Formula for creating a successful financial planning practice.

The Essential Formula emerged from Beckes' own coaching experience. As she looked through the case studies from her financial planning clients, Beckes found a pattern that most advisors-who are deeply engaged in their own practices and familiar with only their own situations-couldn't possibly perceive. "I sat down with everything I knew about the most successful advisors I'd worked with, and all the things that started to happen as they began to achieve their business and personal goals," she says. "In every case, they would totally transform the practice management side of the equation in favor of the advisor, all in very similar ways."

FINDING YOUR NICHE

The Essential Formula is written up in detail in my newsletter, and also in The Coaching Report, which you can get for free from my website. But the quick version is that it starts with your selecting a client base that you personally resonate with, whether it be oral surgeons or people who fix the wires for the phone company, and-as quickly as possible-begin to specialize. If you can manage to do this, it opens up a whole lot of interlocking efficiencies in every corner of your practice.

Suddenly, you're able to train yourself to serve a small, distinct subset of the human population, and immerse yourself in the marketing issues of, say, your horse trainers or golf pros, the pension plan provisions for the hospital administrators down the street, or the business challenges that your swimming pool and spa servicing clients face-more completely than any other advisor. Your conversations with clients become effortless and rich.

This also allows you to get the best of all practice management worlds: You can create a client experience that is highly customized to the very specific needs of airline pilots, owners of dry cleaners or senior executives with a large local firm, but offer, essentially, the same services in a similar way to all of them. Your staff knows exactly what to do with these people, and you know exactly where to find them, how to market to their most pressing concerns, and how to get them talking to one another about you. The more you get to know these people, the more you can envision a dream service package for them. That means superior service, more value for the same work (and price), and more referrals within their network of acquaintances.

Beckes says that most advisory firms are built on a very different, inefficient foundation of outlier clients-that is, a bunch of people you picked up along the way who have little in common. This diffuses your focus. Most advisory firms experience a lot of confusion about who gets what service and who wants what to happen (and when), leading to a lot of unproductive catch-up time, weak job descriptions, difficulties in hiring and evaluating staff, insurmountable marketing challenges and crushing workloads when the markets go south and everybody panics.

Developing that standardized, customized client experience may be the most important part of The Essential Formula because it lets you break down, step by step, what has to be done with each client. You can then train each member of your staff to play a specific role in the process, giving you more personal capacity. "Capacity is so valuable that it requires a lot of work to create," Beckes says. "In the final analysis, your only inflexible resource is your time."

MAKING CHANGES HAPPEN

Holding that thought, let's move to another business consultant: Spenser Segal, president and founder of ActiFi. After offering practice management advice to thousands of planning firms, Segal has found that most advisors are not good at translating the things they want to happen in their firm into highly specific action steps. Asking you to build efficiency into your practice is a little like asking you to build your own automobile, he says. You know what you want and generally how you want it to work. But how do you acquire the parts and assemble it?