How to Attract Top Talent

Advisors discussed a number of approaches to breach the gap on this issue. One response that had heads nodding came from James:

We tell our support staff when we hire them that our goal is that in a typical five-year period everyone who works for us will be compensated in the top 10% of people doing similar jobs elsewhere. To get that top 10%, our staff have to accept that if the market has a tough year, salaries will not be as high as they’d like them to be, and they must have the confidence that they’ll more than make up for this in average and in above average years. That’s why we tell all new hires that we pay a competitive base to start, but that they shouldn’t look for increases in their base salaries. Rather they will participate in the larger pool of compensation dollars that are available as our firm grows.

Another topic of debate was the calculation of variable compensation for support staff. There were three schools of thought on how to calculate a team member’s bonus:

1. The bonus should be driven entirely by the firm’s overall profitability;

2. The bonus should be driven entirely by support staff’s performance, regardless of the firm’s performance; and

3. The bonus should be a blend of the two.

Some advisors were proponents of having the bonus driven by the firm’s profitability, so that in a rough year their exposure is limited. Geoffrey took the opposite view:

For maximum motivation, people have to know what their upside is, they have to know what they need to do to get that upside and getting that bonus has to be in their control. We establish “Key Performance Indicators” or KPIs for all of our support staff. For example, no missing documents in client files for which they are responsible, no compliance issues, all new accounts opened in three days and every client call returned within 90 minutes. Our people know that if they hit their KPIs, they’ll get a big chunk of their bonus, regardless of how the firm does, and we think that’s one of the things that keeps staff motivated and going the extra mile.”

“It’s about more than money”

Another topic of discussion was incentives for team members beyond compensation. There was a split view on this, with some advisors very focused on compensation as the key motivator for their team.

Those advisors were in the minority, though, with the majority focusing on other aspects of the job to keep their team enthused.  Patricia’s view on this was typical:

Cash is simply not enough to keep the best people. There’s always someone willing to pay more for top talent. Turnover of staff is terribly costly, both for us and for clients. Once we’ve identified a staff member as a keeper, we want to do everything possible to hang on to them.

And for us, the number-one thing that works is flexible hours. As long as people do their job, we let them work from home one or two days a week. And we tell all of our staff that if they need to take a day off to attend to a personal issue, provided that it doesn’t get in the way of getting work done, they may go ahead. We’ve never had anyone abuse this and it’s a big loyalty builder with our team.”

Other advisors hold quarterly team lunches and dinners to build a sense of camaraderie. And a number of advisors talked about sitting with their entire team to walk through their annual business plan and to provide quarterly updates on progress, so that everyone knows how things are going. “You have to give people a sense that their opinion matters,” said one advisor. “And the best way to do that is to give them lots of opportunity to provide input into what the entire team should be doing. Then, keep them posted on what’s happening throughout the year.”

Giving feedback on performance

Another ingredient to a motivated team is ongoing feedback on performance and in particular conducting regular performance reviews. No advisor enjoyed this process, but most saw the value of letting people know where they stand.  In a couple of cases the advisors had hired a chief operating officer or general manager who took this on, and in some instances they had their office manager do this. As a general rule, however, the advisors conducted these reviews themselves.

Jennifer talked about the importance of balanced feedback:

Given that all the advisors on our team are type-A personalities and perfectionists, it’s easy to focus on the negatives and things that need fixing. What I’ve learned to do is to always start with the good news and the positive things. Having a focus first on what they’ve done right makes the people on my team much more receptive to the areas that need improvement.

Paul discussed the importance of talking about things as soon as they happen:

Before becoming an advisor I worked for a large company and in my annual reviews it felt like my boss had stored up a year’s worth of all the things I’d done wrong. For us, much more important than annual reviews is talking about something immediately after it’s happened. Whether good or bad, we want to reinforce positive behavior and address problem behavior immediately after it’s taken place, while it’s still fresh in people’s minds.

Recruiting top talent

Even with low turnover, a successful team periodically needs to hire additional talent. As one advisor put it: “If you’re not growing, you’re dying.”

Very few of the advisors who participated in the lunches hired staff without previous experience. Word of mouth was the most common strategy for hiring new team members. “Our goal is to become a magnet for top staff in our community,” Bruce said. “We want to be known as a happy, fun place to work that treats people with respect and gives them opportunity for growth.”

Several of the advisors paid a finder’s fee to staff if they recommended someone who was hired. Another advisor talked about sending assistants to training sessions for admin staff sponsored by fund companies. “We encourage them to go and sit at tables with people they don’t know,” she said. “We’ve hired two people as a result of our assistants going to sessions for admin staff and recruiting someone as a result.”

Another topic of conversation was interviewing job candidates. When one advisor, Jennifer, talked about her approach, heads nodded around the lunch table: “You can do all the interviewing and check all the references that you want,” she said. “By far the best way to figure out if someone is going to be a fit is to get a prospective hire to spend a morning with the support staff they’ll be working beside. At the end of the morning, our existing staff give us a reading on whether that new hire will work.”

To read more about motivating your team, you may find these articles valuable:

Feedback That Motivates Your Team
Five Steps to a Passionate Team
How High Expectations Can Hurt Your Business 
How One Advisor Boosted His Team’s Performance 
The Perfect Team Meeting to Start Your Week 
Two Simple Questions to Motivate Your Assistant 
Four Steps to a Top-Performing Team 

Dan Richards conducts programs to help advisors gain and retain clients and is an award winning faculty member in the MBA program at the University of Toronto. To see more of his written commentaries, go to www.danrichards.com or here for his videos.

Read more articles by Dan Richards