Michael Nathanson is the chairman, CEO, and president of the Colony Group, a wealth management firm with several billion dollars in assets under management and with offices across the United States. But Michael thinks his most important title is one that isn’t listed on his business card: CIO.

“I sometimes joke that I’m CIO of this organization — the Chief Inspiration Officer,” says Michael. “I consider that to be one of my top functions. What’s the key to our success? It’s to attract, develop, engage and retain the best people in the business. That only comes with inspiration.”

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On today’s show, Michael offers some tips on creating inspiration, innovation, and growth in your business, and also shares memories of a couple of his Harvard Law School classmates whose names you’ll definitely recognize (hint: think President and Supreme Court Justice).

Key Points From Michael Nathanson:

1. A good leader is an open-minded leader. 

Lots of CEOs and entrepreneurs confuse leading with acting like they’re always right. “The number one ingredient for becoming a good leader is having an open mind,” advises Michael. “It’s being a lifelong learner. It’s being always curious. It’s never digging your heels in and being defensive. Never being committed to be right, but rather committed to being open and curious and to listening to other people.” A door that’s always open to your employees and your customers will create the kind of inspiration that leads to new ideas, and a happier workplace.

Michael Nathanson: We need to be thinking much bigger than we are right now. I think we

Michael Nathanson: We need to be thinking much bigger than we are right now. I think we’re all capable of creating something far beyond the current RIA model.

2. A good advisor asks good questions. 

Michael’s professors at Harvard were fond of the Socratic Method — asking students questions instead of supplying them with answers. Michael believes that a good financial advisor should operate the same way. “The best advisors are the ones that listen, that ask questions, that ask more questions and that are always thinking about the future, about all the potential consequences of following a certain task,” says Michael. Helping your clients work through their financial scenarios by asking questions will help you understand your clients better, and provide more personalized service. That’s the kind of inspiration a client will appreciate, and a robo advisor is going to have a hard time replicating.

3. Fierce Independence is overrated. 

RIAs like to say, “we’re fiercely independent.” But if you look around, the business world has evolved to a co-opetition model. Many companies work together in certain areas and compete against each other in other areas. For example, the Colony Group has good custodial relationships with Fidelity and Charles Schwab, yet those firms also compete against the Colony Group with their branch offices. Apple is a big buyer of iPhone parts from Samsung, yet who is Apple’s biggest competitor in smartphones? Samsung! Michael warns, “I think independence is a good thing, but fierce independence to me, means that we just continue to be fragmented in our space, that everyone is trying to do the same thing and we’re all too small to really provide what our clients truly need.” The better model is to find ways to work together for the betterment of clients and the industry.

4. Keep an eye on the dashboard. 

Michael and his team use spreadsheets. You might use a whiteboard or analytic software. But it’s important that everyone in the office knows what the key metrics are, and where you stack up. At the Colony Group, “Every counselor (advisor) has their own dashboard that shows their clients, assets, revenue, additions, subtractions; it’s effectively a snapshot of their own practice built into this dashboard,” says Michael. Don’t go crazy — if your dashboard looks like an airplane cockpit, it’s probably too complicated — but it’s important to keep your team focused on the basic indicators that are important to your business’ success, and push your employees to believe they can do greater things. Believing that Colony can be greater, and that the RIA community can be greater, “That’s what inspires me,” says Michael. “That’s what I think inspires our company. That’s what I think inspires our clients.”


– The Colony Group Visit Michael and his team.

– The E-Myth Revisited: Why Most Small Businesses Don’t Work and What to Do About It book by Michael Gerber

– Better Conversation, Better Outcomes podcast by BMO Global Asset Management

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