Examine your culture, compensation, communication, and competitiveness to attract staff
Many industries are seeing a labour shortage these days, but the wealth management industry has been anticipating one for awhile as many seasoned advisors retire with fewer younger advisors entering the profession.
It’s a challenge that many firms are wrestling with as they try to recruit young advisors. Some are actively drawing in new talent to work with older advisors and transition their clients before they go. Others are talking to post-secondary school classes to entice them to consider the wealth industry as a career. But, whatever your tact, here are five factors to consider in the process,.
○ Examine your culture: Take a close look at your workplace culture. What do you stand for? What client base do you serve? What are you corporately trying to accomplish? Does everyone understand your value proposition? You can discuss, and hone, it at team meetings, so everyone understands what it is and that each feels part of it. That will also help you identify what’s important in that to onboard new advisors and help you hone your message to attract them. But, then it is important to ensure that everyone continues to feel part of how your business may be evolving, so frequent, clear communication is also important.
○ Be clear and transparent: A clearly defined philosophy will help you with retention, engagement and investment, individual and firm performance, and firm culture. So, define your performance philosophy as well as your compensation values, and ensure that you include clearly defined goals and incentives. Compensation should align with firm goals and specific roles. For instance, if you hire advisors to focus on selling, provide more leveraged short-term compensation. Also spell out how you will update your compensation philosophy in response to changing markets, firm growth, or major events – such as global pandemics – x that impact how advisors operate and drive business.
Employees need to know what is expected of them and what they need to do to advance, but they also need to receive consistent, clear performance feedback. You should spell out how they will be compensated, including their base salary, benefits, and incentives, how they can advance, and how increased compensation can be earned. Younger professionals also want to know what professional development and career growth opportunities are available to them, and you can align compensation with individual performance and adherence to organization behaviour best practices. These may be awarded for individual or firm-wide projects or goals. Short-term incentives can include compensation such as a flat bonus. Longer-term incentives for high performers can include equity or profit sharing or retirement vesting and plans.
○ Be generous with extra benefits: Extra benefits, especially for the younger generation, can make a big difference when its’s hard to hire. Sometimes they’re even more important than compensation. Since the pandemic, for instance, more employees have come to value workplace flexibility with. But, your firm may have other unique things to offer, such as mental wellness days or team volunteering for a worthy cause that everyone feels is worth participating in.
○ Offer dedicated career guidance: You need to create a clear path to success so your employees know how to get there. You can set certain milestones so that junior advisors know which licenses will lead to pay increases or more client responsibility. Knowing where they stand in terms of achieving the next level will help you to retain them. But, mentoring is also important with senior staff advising more junior staff. The more experienced advisors can share what they find rewarding about their work – such as being in a constantly changing environment where learning is key or helping clients achieve their life or retirement goals. So, it’s good to help young advisors identify what they enjoy about their work, which will help to sustain them on their life journey.
○ Stay competitive: Start by considering the base salary, which is key to attracting talent and staying competitive. Evaluate industry standards to benchmark current and future positions based on role, experience, and tenure. Consider the benefits and perks that will be part of the competition since those are particularly important to millennial and Gen Z advisors. These benefits don’t necessarily need to be financial, as flexible work arrangements shown. Healthcare and retirement benefits can also set you apart during a job search, but some companies also offer paid time off for volunteer activities, gift-matching programs, student loan assistance, and even sabbaticals.