This case study is based on the situation of a client of The Covenant Group. The names and critical details have been changed to preserve client privacy.



The first time you met Larry, you knew he was going to make it big in the financial services industry. He was hard-working, passionate, totally dedicated to his clients and proud of the work he did for them.

He started his practice right after university, under the tutelage of renowned branch manager Bob Styles. In less than four years, this rising star was headlining industry conferences, willingly sharing his story on how he had accomplished so much in such a short period of time. His engaging personality and infectious energy could motivate any advisor to reach for new heights.

Larry had a habit of dropping into our office whenever he was in town, and when I saw that he had called to arrange an appointment, I was excited because six months had passed since his last visit.

When his branch manager had retired 14 months earlier, Larry had decided he wanted to be independent and open his own shop. He engaged us to help with his marketing plan. He then went to work with his characteristic drive, and, from all accounts, he was continuing his stellar growth.

You can imagine my surprise when a visibly worn Larry walked into my office. The usual spark wasn’t there. In fact, he looked downright depressed. Our greeting and small talk were brief before he went right to the point of his visit.

“I have been thinking lately that this business might not be for me after all,” he said.

That statement shocked me even more than Larry’s diminished demeanour because when we had met for a full day a year earlier to develop the marketing plan, Larry told me he couldn’t think of anything else he’d rather be doing than continuing to build “the best financial advisory practice in the country.”

“Larry,” I said, “I know it’s been longer than normal between our get-togethers, but what has changed so dramatically that you could possibly think of leaving the business you’ve built and loved so much?”

“It just isn’t fun any more.”

“What do you mean?” I asked.

“My growth has completely slowed and I’m getting frustrated at my inability to do anything about it,” he said. “I can’t seem to focus like I used to, and things are getting out of hand. I’m not serving my clients as well as I want to and the atmosphere in the office isn’t what it used to be. I always have had a great support team. But, lately, there seems to be tension among them and they are less productive, even though they know that the more money I make, the more they make.

“I even have a suspicion that my executive assistant, who is my sister-in-law and has been with me from the start, is looking around for another position.

“I seem to be working all the time but not getting ahead. On top of that, I took on a very large overhead commitment when I opened my own office and I am feeling pressured by that obligation. It didn’t bother me at first because we had the momentum to handle it, but now I’m not so sure.”

“Whoa, Larry,” I said, “You’re making me dizzy. I can’t take any more!”

Here’s the advice I gave him: “Let’s step back for a minute and look at what’s been going on in your world from a different perspective, because I think I know what might be happening.

“Unfortunately, Larry, I think you have been a victim of circumstance, and the stage you find yourself at today was almost inevitable. I wanted to speak to you about this when we were last together, but you were so cranked up about becoming ‘independent’ that I knew you wouldn’t listen. Let’s try now.

“Your situation reminds me of the child prodigy who keeps skipping grades at school until he finds himself attending university at the age of 15. While brilliant at his studies, he often finds it difficult to cope on campus because he hasn’t had the chance to develop the needed social skills.

“You grew very quickly in this business and, as a consequence, you may have missed developing some of the skills you need to manage a large practice. Bob Styles was a great mentor who fostered your innate talents as a salesperson by insulating you from business-management issues. In doing so, however, he left you underprepared to be a full-time entrepreneur.

@page_break@“Entrepreneurs seldom set out to be managers. They love their business and would far rather focus on getting and serving clients than developing an organization. As a result, they have no formal structure or role descriptions for their team. Cash flow is often an issue, so they supplement relatively low salaries with bonuses based on results. As jobs evolve and new people come on board, employees become confused about their accountabilities or even who their boss is. Work falls through the cracks and the entrepreneur becomes frustrated because he or she has to do things that take them away from their core competencies, and they don’t understand why their employees just don’t ‘get it.’

“Employees, on the other hand, start to burn out and quit, customer service suffers, opportunities are missed and the entrepreneur sees his or her long-term vision fading and decides it isn’t worth it any more.

“Does any of this sound familiar, Larry?” I asked.

“It certainly does,” he replied. “So what do I have to do to fix this?”

“It’s not what you need to do, Larry, it’s what you need to stop doing that will make the difference,” I told him. “The hard part is not learning how to run an organization; it’s ‘unlearning’ some of the things that made you successful in the first place.”

“Like what?” he asked.

“Like assigning work in an unclear manner; like relying on the skills you already have rather than learning new ones; like hiring based on emotion rather than skill; like letting compensation substitute for management; like working all the time in the business and never on the business.

“Larry, the bottom line is: you have to stop believing that you can take your business to where you want it to be without being a capable manager.”

“But I don’t want to be a manager,” he said. “I just want to meet people and develop the business.”

“That’s a decision you will have to make,” I told him. “How big do you want your practice to become and what role do you want to play? Your answers will determine the type of organization you’ll require. If you want a large practice but don’t want to fulfil the manager’s role, you will have to hire someone to do that for you. That will cut into your revenue in the short run but may be the best long-term solution. On the other hand, you also give up some control, which may be at odds with your desire to be the master of your own destiny. The choices are obviously yours.”

“How do I determine what’s best?” he asked.

“The starting place is always your vision of the future. You need a conscious, articulated vision of what you want your world to look like three, five and 10 years from now. Then you need a well-defined strategy to reach that vision. That strategy has to be supported by a formal organizational structure designed to make it happen. Finally, you need staffing and managerial leadership practices to maximize effectiveness, efficiency and trust.”

“We could do that, couldn’t we?”

“Of course,” I said. “All we need is your commitment to spend the time necessary thinking about what you want. The mechanics are relatively straightforward once we know where we are headed.”

The effect was immediate. “I’m excited about this,” he said, “and can’t wait to get started. Let’s do it.”

Over the following weeks, Larry and I worked together to create a new business plan — one in which he took on most of the strategic components but handed full responsibility for day-to-day operations to a new managing director. An organization chart based on the functions needed to manage the practice efficiently was drawn up, as well as role descriptions for each position. The current staff was matched with the requisite organization, along with training plans for existing staff as required. New hiring needs were identified and the compensation plan was revamped to reward the appropriate activities and results. Most important, Larry’s energy began to surge again and I could see the old spark returning. He was resuming his quest for greatness. IE



George Hartman is a coach and facilitator with The Covenant Group. He can be reached by e-mail at george@covenantgroup.com.