Success Factors of Small Business Owners of Independent Financial Planning Firms

Success Factors of Small Business Owners of Independent Financial Planning Firms by Joanne Snider MBA, Long Island University, 2005 BA, University of Michigan, 1970 Doctoral Study Submitted in Partial Fulfillment of the Requirements for the Degree of Doctor of Business Administration Walden University July 2015 Abstract Small Business Administration statistics indicate that 20% of small businesses fail within the first 2 years and 50% fail within 5 years. The purpose of this case study was to explore the success factors and strategies of 12 small business owners of independent financial planning firms who achieved profitability beyond 5 years. A gap exists in the literature concerning such business owners, and their experiences provide valuable information to others desiring to start or maintain a financial planning business. The conceptual framework was entrepreneurship theory and Porter’s 5 forces model of competitive strategy. The data were gathered via semistructured interviews and business websites and newsletters. Initial coding of the responses preceded an analysis of recurring patterns and themes. This process led to the identification of major themes: technical training is necessary but not sufficient for success; planners need training in business creation, operations, and marketing; and differentiation is important and is achieved by specialization and providing excellent client service. The business owners used Internet websites to present unique planning approaches and fee structures to clients and prospects. These results provide information to people considering starting or maintaining a small business, providers of professional education and training, and business leaders seeking to improve recruitment and retention of financial planning employee retention. Implications for positive social change include providing information to policymakers who seek to support small businesses to mitigate small business failure rates, expand job creation, and provide sources for financial guidance for American employees.Small Business Administration statistics indicate that 20% of small businesses fail within the first 2 years and 50% fail within 5 years. The purpose of this case study was to explore the success factors and strategies of 12 small business owners of independent financial planning firms who achieved profitability beyond 5 years. A gap exists in the literature concerning such business owners, and their experiences provide valuable information to others desiring to start or maintain a financial planning business. The conceptual framework was entrepreneurship theory and Porter’s 5 forces model of competitive strategy. The data were gathered via semistructured interviews and business websites and newsletters. Initial coding of the responses preceded an analysis of recurring patterns and themes. This process led to the identification of major themes: technical training is necessary but not sufficient for success; planners need training in business creation, operations, and marketing; and differentiation is important and is achieved by specialization and providing excellent client service. The business owners used Internet websites to present unique planning approaches and fee structures to clients and prospects. These results provide information to people considering starting or maintaining a small business, providers of professional education and training, and business leaders seeking to improve recruitment and retention of financial planning employee retention. Implications for positive social change include providing information to policymakers who seek to support small businesses to mitigate small business failure rates, expand job creation, and provide sources for financial guidance for American employees. Success Factors of Small Business Owners of Independent Financial Planning Firms by Joanne Snider MBA, Long Island University, 2005 BA, University of Michigan, 1970 Doctoral Study Submitted in Partial Fulfillment of the Requirements for the Degree of Doctor of Business Administration Walden University July 2015 Acknowledgments I would like to thank the members of my committee for their generous help and encouragement. Dr. Kevin Davies, chair, was especially kind and provided encouragement in all phases of my doctoral journey. Dr. Richard Snyder’s input and guidance raised the level of research excellence, and Dr. Al Endres provided truly elegant editing. Dr. Maurice Dawson and Dr. Judy Blando reviewed my documents with patience and precision. Mr. Fred Walker assembled the team of expert resources. Dr. Freda Turner was an inspiration, constantly reminding me that I would soon become a doctor. I owe a great deal of thanks to my family members. They understood my quest and supported me on my journey. They share my achievement, my joy, and my love.