Client Service January 1, 2024

Training New Advisers for Client Retention

Newcomers need guidance from seasoned counterparts, but they should also be ready to jump in impromptu.
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Art by Parapaboom
Special Coverage

Bringing on and training more junior advisers is vital to client retention, with younger advisers ready to take on accounts from their seasoned counterparts.

Advisers who have experience training more junior staff say the best way to get them up to speed is ’not necessarily giving them smaller accounts or doing lots of training before they meet with clients. Rather, ’hands-on training with a more senior member of the team, learning by doing and being comfortable managing missteps will ultimately prepare newbies to take over accounts.

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Getting in the Ring

Kristi Baker, a managing partner at CSi Advisory Services, a Hub International firm, is not too fussed about the types of client accounts on which younger advisers should be included. In fact, she says junior staffers can learn most from working with all types.

“All types of accounts could be good targets,” Baker says. “I think it’s important with new advisers that they have experience with different types of client size, demographics, location knowledge and the needs the clients have. We really try and get them exposure to as many as we can.”

Baker says CSi’s model of training is similar to her experience as a new adviser some 30 years ago. In that model, seasoned advisers and more junior counterparts work jointly together for two to three years on the same accounts. This is a “good formula” for putting the client at ease, the adviser says, because clients can maintain the relationship with those they’ have worked with and are comfortable with, while having the opportunity to work with a new individual as part of the team.

“Over time, we see that the client’s communication and the relationship really build with that team member,” she says. “Those of us who are stepping away start to slow down a little bit on responding, communication, and [the new adviser] picks theirs up. It becomes just this natural transition to communication and relationship-building over that two- or three-year time period.”

Baker finds many advantages to bringing in new advisers on client work. “I still am bringing in other advisers or other team members because I do find that there’s a great deal of value having others in the meeting: different perspectives, different voices, people who can listen, take those meeting minutes and contribute.”

Rolling With the Punches

Steven Kaczynski, a managing director at DBR Fiduciary Plan Solutions, notes that the learning process is not linear; reality may get in the way: Junior advisers may need to jump in to assist a client, even if they aren’t ready.

“Things don’t always go according to plan, and that’s not necessarily a bad thing,” he says. “There could be health or family issue or a maternity or paternity leave. That really accelerates the learning process for the new adviser—like a trial by fire.”

Kaczynski says a staff member might be out on vacation when there’s an urgent matter to take care of, and the new adviser has to step in and help the client out. He gave the example of being on a virtual webinar presentation, but his colleagues’ internet went out. He was forced to improvise and speak on a topic he had not prepared for.

“It’s often stressful in the moment,” says Kaczynski. “Training and onboarding are very challenging because everything feels new and at times overwhelming. But any kind of circumstances happening really does accelerate the learning process.”

Challenges Ahead

It’s one thing to be able to train junior advisers, but in a tight labor market, a key area for many advisories is finding good candidates. Michael Gheen, vice president and director of retirement plan services for Oswald Financial, says staffing up is currently the firm’s biggest challenge.

“The learning curve is fairly steep, and finding quality, experienced staff is difficult. “So we really emphasize our value proposition, the work culture, that we’re an employee-owned company. That’s very attractive to prospective employees.”

Looking ahead, Baker believes the biggest challenges new advisers face is how complex the industry has become. “We have share classes, different products, more recordkeepers, more tools and service,” Baker says. “Higher regulation and more technology have definitely added a level of complexity.”

She says it will take time to really understand those components. But new advisers should be willing to ask questions, dig further and figure it out along the way.

Additionally, DBR’s Kaczynski says one of the biggest challenges for newcomers is learning how different clients can be when it comes to their priorities, especially when working with a client that has a committee, which will often have various priorities amongst committee members.

“Now, when I onboard new advisers, I try to make sure that the focus is: Let’s listen to what the client says,” Kaczynski says. “Let’s ask questions so that we can really make sure that we are meeting them where they are and know what they want out of the relationship. Don’t tell them what they should want from us, but make sure we’re always asking, ‘How are things going with your plan? How’s business? How are you personally?’ Just really make sure we’re asking questions and then listening to the answers.”

Practice Management December 1, 2023

Profitable Endeavors

Plan advisers discuss how they provide best-in-class services while still meeting—and trying to exceed—client needs.
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Art by Ellen Weinstein

When Jim O’Shaughnessy reflects on the acquisition of his advisory firm, Sheridan Road Financial LLC, by Hub International five years ago, he is struck by how much the business climate has changed in that time.

Before the sale, O’Shaughnessy and his business partner, Daniel Bryant, had grown their firm to eight offices run by teams of specialists whose focuses ranged from investment research to compliance and marketing, with the whole company overseeing about $15 billion in assets. But increasingly, the two principals saw how firms such as theirs would benefit from better economies of scale.

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“It’s a different conversation working with strategic partners that allow us to scale differently with centralized resources,” says O’Shaughnessy, a managing partner in Hub’s retirement and private wealth division, which is based in the Chicago area, about Hub’s roughly 10,000 plan sponsor clients today. “The goal is to allow that adviser or team to be able to do more of what they love, which is meeting new clients and working with existing clients.”

Finding efficiencies is part of the answer for some plan advisers intending to ensure the profitability of their business without sacrificing service. At a time when many plan participants want increasingly personalized advice and plan sponsors are seeking robust financial wellness programs, plan advisories are turning to a range of solutions aimed at managing costs while also expanding their offerings. Some are leaning on technology solutions to help curb expenses, while others are spending more time planning with their clients to identify what services they value most.

Practice Focus

If there was any hesitation about replacing in-person meetings with video conferences, COVID-19 did away with them. Even today, with in-person meetings available again, O’Shaughnessy says that, together with clients, his team is being more thoughtful about when to meet virtually and when gathering in-person is preferred. Pre-pandemic, quarterly meetings all occurred in-person and were costly in both time and travel expenses, as well as in preparing and shipping printed, color, 150-page materials, O’Shaughnessy recalls. He estimates his firm held close to 800 face-to-face client meetings then, whereas today, the majority of their meetings are virtual and are significantly shorter.

“In March of 2020, almost 100% of all our client meetings were face-to-face—so planes, trains and automobiles,” he says.

In the past, he typically would see one client in the morning and one in the afternoon. Now, he sees four or five in one day.

“On the one side, we are way more efficient,” he says. “But I also find that our team is probably working at least as hard, if not harder than, as they were before.”

For Mike Webb, a senior manager in plan consulting for CAPTRUST based in the New York metropolitan area, a principle focus area on the business side of an advisory is the “ideal customer.”

Most advisories have what he calls a “sweet spot” in terms of their client. For instance, if the ideal client has between $30 million and $100 million in plan assets, and a new prospect with $5 million in assets comes along, Webb advises the firm not to take on that new customer unless there is a separate, compelling reason to do so. That strategy will help avoid painful and potentially damaging conversations later if an adviser has to scale back on clients.

“A lot of what’s written out there talks about how to fire your unprofitable clients, and I guess most of the people who write those things haven’t actually had to fire them,” he says. “It’s not a pleasant experience, and it doesn’t tend to win you friends and the influence of people.”

Webb sees much more benefit in being strategic about which RFPs to respond to in the first place. “We don’t bid on all of them, because we may say, ‘That’s just not a good fit for us in terms of not only profitability, but relationships,’” he says.

Job Priority

Identifying ways to streamline work at OneDigital starts with an annual conversation in the fall when Jania Stout, Retirement + Wealth senior vice president based in the Washington, D.C., area, asks her team to note the top three tasks that prevent them from being more proactive with their clients. In some cases, this dialogue leads to recommending a new hire to take over specific responsibilities.

For example, OneDigital has a specialist dedicated to helping clients manage conversions from one recordkeeper to another. This fall, the team identified the need for a director of engagement services, she says. While the firm has focused on financial education for years, its employees noticed clients were seeking more support on an ongoing basis.

“Anybody can just offer education and webinars, but to really track the results and see if you’re on the right path to making a difference, you’ve got to have somebody that’s focused on it,” Stout says.

Stout says OneDigital is also thoughtful about managing its client workload in terms of both number and revenue.

“Once you get about 20 clients, that’s when …. the yellow light is on,” Stout says.

Limiting the number of clients per adviser could seem counterintuitive to the idea serving as many clients as possible with the fewest advisers. But Stout says providing services clients are looking for is the key to profitability.

“If you look at our client base, we don’t lose clients, so we don’t have to worry about replacing a client that walked out the back door with someone new in the front door. That helps with profitability,” she says.

Existing clients may also benefit from OneDigital’s complimentary services, such as wealth management or employee benefits, Stout says.

“Additional people on the team might cost more money in the beginning, but at the end of the day, we’re going to get additional services, because we’re going to be able to provide more value to our client,” she says.

Stout also sees how the selective use of technology helps keep costs down. She watches how the efficiencies multiply with one-on-one financial coaching over Zoom, scheduling by Calendly and even relying on artificial intelligence-backed notetaking that feeds into the customer relationship manager the firm uses to track client interactions. But those features are not meant to replace one-on-one meetings, she says.

“At the end of the day, you still need humans to deliver the advice to the participant from a financial wellness perspective, and that’s always going to cost money,” she says.

How do firms know whether their clients are happy with the service they are receiving? For Webb at CAPTRUST, asking detailed questions of clients in a review process is key.

“It’s a pretty comprehensive survey,” Webb says. “We’re discovering not only why you like us or don’t like us, but how exactly we can improve.”

 

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