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  • by Colleen Kirton
  • Mgr, Sustainability Marketing & Program Develpment, TD Ameritrade Institutional

It’s time to stop thinking of non-advisor roles as non-important roles

If you’ve ever considered hiring someone to help out around your firm, but thought, “Nah, I don’t need the extra expense for something I can do myself,” then it might be time to think again.

The RIA industry is set to grow at a rapid pace, with clients looking for financial advice more than ever before. And their expectations of the types of services you provide are also increasing. Retirement, healthcare, estate planning—the list goes on. So how do you keep up?

“Integrate ALL the technology!” Sure, that might help for a minute. But then what? Who is going to be there to educate your staff on how to use it? And more importantly, who will make sure you’re optimizing your technology to operate your business as efficiently as possible?

It’s when advisors get to this point that they really start to view their ‘practice’ as more of a business and start thinking of the support functions that go along with it.

Why these roles matter

According to Kate Healy, head of Generation Next, TD Ameritrade Institutional, advisors need to plan on adding support roles when they feel like they are at about 80% capacity with their firms. Waiting until it’s too late could be problematic.

“Your client service can be negatively affected if you don’t have the right number of administrative, operations and client service teams in place,” warns Kate. “The firm may be full of advisors who are rainmakers and doing financial planning, but they’re not necessarily trained in running a business. And when you start to think about your practice as a business, you have to think beyond the product, which is financial planning, and think about how you’re professionally managing the business as a whole.”

Kate also says it’s time to stop thinking of these roles as a cost, and start looking at them as an investment. “Advisors should think, this is how I’m going to invest in my firm to help us be better managed, more efficient and enhance our client service experience.” To help prepare yourself for the cost, calculate how much more in revenue you’ll need to generate to comfortably afford adding a support role. This way when it’s time to add a role, you’re already mentally prepared for the change.

Research shows that firms with dedicated management roles produce 36% higher income per owner and acquire clients 12% faster than those that don’t (FA Insight 2014).

Finding the right talent

It’s important to be intentional about who you hire. Kelli Cruz, founder and managing director of Cruz Consulting Group, shared, “There’s no decision that’s more crucial than a new hire. One bad hire impacts everyone.”

And there is a challenge finding qualified individuals for professional management roles within the RIA field. “It’s still a relatively new industry—about 35 years in existence—and a lot of the firms are on first- or second-generation management,” explains Kelli. “For these generations, it used to be all about increasing the client base, but we find as firms grow, managing the day-to-day tasks are becoming increasingly critical.”

But we have good news. Charesse Hagan, Founder and Operations Consultant at Charesse J. Hagan, LLC., says to keep in mind that not everyone’s end game is to be an advisor. “I think that’s one of the things that trips people up; they think that the career path has to be leading to advisor. A lot of people are happy with what they’re doing, but they aren’t happy with the way their firm is doing it.”

Charesse couldn’t find a job she liked with a career path, so she created her own. She took her strengths, saw a void in firms and created a virtual para-planning firm, where she helps advisors create operational and administrative efficiencies.

When you shift your mindset on where to look for talent, the opportunities become endless. In fact, 36% of firms already look to source professional management roles from outside the financial advice industry (FA Insight 2017).

Kate shares how advisors should look for people who have potential and the right cultural fit. “You can train someone on the technical aspects of the business and how your firm is run, but you’re looking for people with transferable skills that are going to have that client service mentality or that operational focus, and they may come from different careers.”

Professional management roles are also a good way to bring diversified talent into your business and appeal to a broader client base.

Today, women dominate the support and administrative fields in the industry and own nearly half of the management roles. “These are important roles,” says Kate. “So when we look at getting diversity into the firm, professional management is a good place to focus on as these candidates are often female.” She adds, “We need to talk more about this, to attract even more diverse candidates to the profession.”

But having powerful, awesome women in your firm is only one plus. By sourcing talent from other industries, you’ll also gain diversity of perspective and introduce outside viewpoints that can be a priceless tool to have in your pocket.

And when you’re recruiting the younger generation from universities, be open minded to non-traditional degree plans. Students with psychology or education curricula often study those fields because they are able to communicate well and want to help people – exactly what a planning profession does.

Building professional management into your firm

Now that you know why you want the roles, and where to find the talent, let’s talk about how to make it work.

This isn’t something you can whip up overnight. This is something you should think about strategically every year. Ask yourself, “If we want to grow, what is our capacity for that currently? And what is holding us back from reaching our goals?” Figuring out where you are and where you want to be is a good starting place.

Next, think about tasks you could hand off to others. Are there responsibilities that can’t be ignored but could easily be delegated?

“Consider what those first roles could be,” suggests Kate. “Whether it’s an operations manager, a para-planner, or an administrative person, you can’t wait until you’re at 100% capacity to figure out where you need help. We’ve all been guilty of saying ‘I’m too busy to explain so I’ll just do it myself,’ and that’s not good for anyone. It’s best to bring someone in when there’s time for them to sit down with others and start taking on responsibilities in a learning environment.”

And finally, plan to build out career tracks for the professional management roles in your business.

“Start with a framework that clearly defines what the roles in the firm are,” explains Kelli. “Structured pathways keep people engaged and let them see how they fit in with the big picture. They want to develop skills and learn the business even if they don’t want to run the business one day.”

And remember, not all career tracks will have a client-facing component. Consider mapping out criteria of what it takes to move up. Maybe as you begin adding support roles you’ll need a manager to watch over it all. Are there other qualifications like demonstrating the firm’s core values? As your firm grows, make sure you have a clear plan employees will understand and be able to follow.

“I don’t believe compensation motivates everyone,” says Heather Robertson Fortner, partner, chief compliance officer and chief operating officer, SignatureFD. “Sure, it’s a core component, but good coaching, opportunity, autonomy and an extremely strong culture with amazing benefits will set you apart.”

At SignatureFD, Heather shares that in addition to work from home days and flexible PTO banks, they give employees a paid five week sabbatical after five years of working there and as she puts it, “you have no idea how much that motivates people!”

FA Insight is a product of TD Ameritrade Institutional, Division of TD Ameritrade Inc. FA Insight is a trademark owned by TD Ameritrade IP Company, Inc.

TD Ameritrade, Inc., SignatureFD, Charesse J. Hagan, LLC., and Cruz Consulting Group are separate unaffiliated companies and are not responsible for each other’s services or policies.


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