With an associate advisor on board, senior advisors can shift their time toward new revenue-generating activities.
This article was co-written by Jessica Jarosik, CFP.
As advisors, we are continuously looking to grow our practices, which requires regular evaluation of growth targets, workload, and whether our team members are working at their fullest potential. Inevitably there will come a point when it becomes impossible to effectively close new business while offering your existing client base the same caliber of service to which they are accustomed. Adding and grooming an associate advisor eager to learn can provide bandwidth for senior/lead advisors while also improving the quality of client service.
Day to Day
How any one firm shapes the associate advisor position will depend on its operational structure, the skill set needed, and the ideal experience level of the candidate. As such, an associate advisor can take on many different roles, and some firms may give the associate a more defined title--operations associate, client service associate/manager, assistant advisor, paraplanner, etc. For smaller firms, where roles aren’t always as clearly defined, an individual willing to fill multiple critical gaps in a variety of areas may be the best solution.
Associates new to the industry or with minimal experience, such as a recent college graduates, may be more suited to fill operational needs, such as nonadvisory servicing--cashiering, account setup and monitoring, custodian liaison, etc. While in this role, the associate would be able to focus on learning about the firm and its service philosophy from the inside while also gaining valuable experience interacting with clients regarding their day-to-day transactional needs.
More experienced associates would be able to perform more complex tasks and take on additional responsibility in the client relationship. During this time, the associate will be working on fine-tuning her technical skills while simultaneously increasing her interaction with current and prospective clients. A typical workload may include conducting advanced planning and investment analysis, portfolio construction and presentations, monitoring client accounts, identifying planning opportunities, trading, and facilitating the overall consulting process.
With an associate advisor on board, senior advisors will gradually be able to shift their time away from crunching numbers in the office and more toward revenue-generating activities. This, of course, does not happen overnight. A senior advisor would not be able to completely hand off client responsibilities to an associate advisor on day one, because cementing these relationships takes time. Initially, associate advisors would be delegated more routine client management tasks, such as portfolio reviews or client transactional requests. Over time, with proper mentoring, associate advisors will be able to assume more responsibility for client relationships. At this point, the senior advisors will have the opportunity to gradually transition a portion of their existing client base and, therefore, devote more of their time to deepening key existing client relationships, building new business, collaborating with COIs, and strengthening the brand in the community.
Adding an associate advisor to your team not only adds intellectual capital, it also offers an opportunity to provide value-added services, leading to capital growth. Having more team members promotes collaboration and innovation. It could be as simple as making sure there are always two advisors in a client meeting, which is a step senior advisors can take with even the newest associate advisors. Start by having the new associate advisor join meetings to listen and take notes. This practice will ensure that the all details of the meeting are captured while providing valuable learning experience for the new associate. This procedure can then evolve into the associate advisor partaking in the conversation and eventually, when the associate advisor becomes capable, leading the client relationship. A strategic, long-term goal would be to build a team of specialists rather than a team of generalists. This strategy can allow you to set your firm apart from others by developing subject matter experts in-house to focus on client base demands/needs. Your firm can achieve this by hiring former tax accountants, insurance agents, or technology professionals, or by encouraging employees to further educate themselves in an area that interests them.
There are more advisors nearing the end of their careers than there are those at the beginning of their careers. As these retirements continue, our industry stands to lose a wealth of knowledge not easily replaced. By using the associate advisor position to groom the next generation of firm leaders, a sustainable legacy plan develops. Not only does training associate advisors ensure that competent individuals will serve your clients, it also ensures that the vision and culture of your firm continues on.