How Top Financial Advisors Build Their Teams

How top financial advisors build their teams 

Last week I had a call from a financial advisor who's adding two people to their team. They are a growing practice and want to discuss what they needed for the new staff. I asked them my 4 standard practice management staffing questions and this opened up some fundamental issues for them as well as most financial advisors and firms.

The four practice management questions for financial advisors on staffing

  1. Do you have an employee value promise and what elements are in your value promise?
  2. Do you have a plan for sourcing hiring, and a process for onboarding new staff just like you do for new clients? Is it well documented? 
  3. Do you have a career path mapped out for new hires which includes training and development in writing? 
  4. Do you have a compensation package that discusses the firm's goals as well as the employee's goals towards remote work, flexible work schedule, paid time off for volunteering, and other benefits top firms offer?

Why do I need all of this?

You don't need to do this unless you want to be in the top 20% of the financial industry. To be competitive in the staffing and talent space you need to have a solid offering and not just pay more. New talent requires new thinking. This includes your plan for remote work and a flexible work schedule. This means you are supporting the work-life balance and have a plan in writing to support it, not just paying lip service to a potential hire. You need to get this on paper and have a plan in writing so that it does not look like you're winging it on your next hire. What documents do you have on hiring, onboarding training, and development? 

Where do I start?

Recruiting staff has become one of the top three benchmarking priorities for financial advisors in North America. Start by building out your employee value promise. Most financial advisors train their staff 4 hours or less in a calendar year. Yet the top 20% of firms have mapped out career paths and growth opportunities for their staff. Start by putting this on paper.

  1. Describe your work setting in writing, which may include remote work and the technology you use to support it. Can you improve it?
  2. Put in writing how you communicate to your current team, detail the meetings, the discussions the issues, and how you support their role
  3. Clearly define your mission and go back to your business plan to map out the goals of the firm. This year is extremely challenging for financial advisors since the market is down, revenue is down and expenses are up. I get it. Why should I invest in the business when profitability is down? Because that's what the top 20% do and you know investing in people is a high ROI. Measure your staff ROI. For a simple example. If you free up 200-400 hours of your time, at $500 per hour is $100,000 to $200,000 potential growth, or potential for more time off for you and your family. What will you do with 200-400 more hours in a calendar year? 
  4. List out all the benefits beyond the base salary in writing. Is there anything that you could add for the whole team?
  5. Go over staff training and all of the developmental opportunities that occur in a calendar year. Can you improve it?
  6. What are the key performance indicators you need to measure your firm success staff success and overall success? Consider benchmarking your practice to see where you stand.

I don’t have time to do all of this

Start by writing everything down and getting your plan and thoughts on paper. Capacity is the number one issue for financial advisors. Your team is your most important asset. Just like acquiring ideal clients, you need to have a plan to develop and acquire ideal staff. having a high-performance team means creating the culture and values and goals for your people. It has been said that you can delegate everything except prospecting in a financial advisor's practice. I disagree, you can delegate everything except prospecting and building culture in your financial advisory practice. Start to build culture on paper for your team then it will become clear of your strengths weaknesses and where the opportunities lie for your firm to be in the top 20%.

Office management

Financial advisors are entrepreneurs. They build their own practice and carry many hats. But they run out of time when it comes to running the business. The business stalls because they go back to what they know, which is advising clients and prospects. The list of projects gets stalled such as building processes, implementing technology, and hiring new staff. The reason why is that some entrepreneurs enjoy business building and practice management, while others know they need to do it, but don't do it because they do not enjoy it. They find it frustrating since they cannot spend the time it takes to do it properly, so they quickly fix it and deal with it later. Sound familiar? Stop putting key processes on hold and assign or hire an office manager. Someone on your team who you trust to delegate important practice management processes to. Start with your hiring process. Assign this process to someone on your team.

Related: Why Investors Do Not Want a Financial Plan