Maintaining Focus in Your Advisory Practice

Warren Buffett’s success stems from his choice to work only within his circle of competence. Are you able to maintain this level of focus in your advisory practice, or are you ‘doing it all’?

Warren Buffett’s success is almost cliché now. The Oracle of Omaha has built a fortune worth tens of billions that spans a career of over 70 years. His acumen and commitment to his beloved profession are the stuff of a legend. Given this almost-unbelievable success, you’d think he knows it all. He has to, right? Buffett and his partner, Charlie Munger, have a curious mental model they adhere to that runs counter to this assumption that they know it all. Let’s let Munger explain:

“I think about things where I have an advantage over other people. I don’t play in a game where the other people are wise and I’m stupid. I look for a place where I’m wise and they’re stupid. You have to know the edge of your own competency. I’m very good at knowing when I can’t handle something.”

?Buffet and Munger choose to focus on opportunities that lie within their ‘circle of competence’. If an opportunity or effort falls outside this, they avoid it. What exactly is this concept?

Circle of Competence is simple: Each of us, through experience or study, has built up useful knowledge on certain areas of the world. Some areas are understood by most of us, while some areas require a lot more specialty to evaluate.

When you consider your own advisory practice, are you adhering to this model or are you regularly engaged in tasks that fall outside of your own circle of competence, thus slowing or even sabotaging your success as an advisor?

Most advisors got into the business to work with clients, not to create and manage countless practice management relationships and manage the day-to-day tasks of running a business, yet that’s what most advisors spend their days doing. Wouldn’t it be amazing if someone had already built these world-class relationships for you and managed the endless tasks so you could focus on building your clientele instead? And what if these pieces were all aligned to place you at the center of the advisor-client planning relationship? Would this allow you to remain at the center of your own circle of competence?

The firm you choose to align with may determine the level of success that you experience in your planning practice. Today, advisors may choose to go it alone and do it all or become part of a RIA that allows you to remain focused on what you do so well. Elevated Capital Advisors offers a unique and incredible opportunity for advisors who value both the resources of a large firm AND the unrelenting client focus of a smaller practice. In other words, we help you remain committed to your circle of competence.

Consider joining Elevated Capital Advisors.

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