Beverly Flaxington is a practice management consultant. She answers questions from advisors facing human resource issues. To submit yours, email us here.
Advisor Perspectives welcomes guest contributions. The views presented here do not necessarily represent those of Advisor Perspectives.
Dear Bev,
Our firm is running full tilt and has been growing significantly over the last few years. Our founder has been personally involved in every single hire we’ve made from our inception 14 years ago. Our growth has forced us to hire people perhaps a bit more quickly than we would have preferred, but we haven’t had much choice because our workload is growing exponentially.
Our founder wants to put a halt to any new hires who he doesn’t personally approve. I don’t see how this is manageable – we are at 32 people. We need to have a hiring process, or even an HR person at this stage of our evolution. But he insists the success has come from the fact that he has handpicked everyone who works here.
How can I show him it isn’t in his, or our, best interest to be wedded to this approach? What are other firms our size doing? When is critical mass reached and HR becomes a necessity?
E.O.
Dear E.O.,
What is the downside to having your founder involved in the process? I don’t disagree with your comment that you might need a hiring process. I’ll address that in a bit, but I am not understanding the negative impact from the founder’s involvement.
A general rule of thumb is that once a firm reaches 50 employees, it’s time to bring in a dedicated HR resource. I did some searching to answer your question and while not specific to financial advisory firms, I found this:
According to an article published by the Society for Human Resource Management (SHRM), a study of about 350 small businesses found that the need for expert HR support often correlates to the number of employees:
- Companies with fewer than 50 employees: owners or CEOs assumed the role of HR manager
- Companies with 50-100 and 101-150 employees: had HR practices and strategies in place (e.g., job analysis, recruitment, compensation, benefits plans)
At 32 people, it is not unusual to have the owner or CEO act in the role of HR manager. However, I repeat my original question and wonder whether your question to me is prompted from some problem created by having your founder involved? For example – is the hiring process, because it has been very active of late, taking him away from other more important priorities? Is the hiring process unclear because he is the final decision-maker and others don’t know why he has chosen a specific candidate? Are candidates confused or intimidated by having the founder make the final decision? Has he made some poor choices that lead you to believe there aren’t good checks and balances in place?
I don’t want to assume something you’ve not written but I get the sense something negative is transpiring that you haven’t called out in your note.
Arrange a meeting with your founder and anyone else involved in the process and identify what’s working and what’s not. There are outsourced HR resources you could leverage, too. Step back and review – with all of the hiring you’ve done of late – how to improve the process, while continuing to keep your founder involved.
Dear Bev,
What best practices do you recommend for a client survey? We’ve not done one before and are hesitant that clients will think something is wrong, which is why we are doing it now. We have lost a couple of clients in fourth quarter of 2018. It is partly because we are concerned about what we don’t know but we don’t want to convey this.
B.E.
Dear B.E.,
Yes, I agree – you do not want to convey this! Surveys are a bit tricky. In this day and age, it seems you can’t do anything without being asked if you will respond to a survey. Yesterday I booked a plane ticket, talked to my bank, retrieved my car from the shop and bought something online and every single contact wanted me to fill out a survey on my experience.
Your clients are likely having similar experiences in everything they do. Be sure not to construct a survey that uses “scale of 1-5 how are we doing?” type of questions. I have worked with many advisors who have outstanding results on their client surveys, but aren’t getting the referrals they desire, so these two things are not always related.
Do a few things to set yourself up for success:
- Let clients know the survey is coming and it’s important to you to hear their feedback. You could frame it about the beginning of a new year, or in response to challenging markets, or your firm’s evolution and taking a step back to see areas you can improve.
- Construct the survey so that there is a combination of quantitative and qualitative questions. You can’t ask too many qualitative because people won’t take the time to write things out but you have to embed 2-3 important questions. Things like “What is the one thing you would like us to do differently for the relationship?” or “What expectations are we exceeding?” and then “What expectations do you have that we’ve missed on reaching?” Don’t be too broad, or too narrow in your framing.
- Stay away from quantitative questions that will just validate that they like you. Focus on specific things – “How much do you value the communication you receive from us each month/quarter?” “How likely are you to pass along something you receive from us to someone else you care about?” Make the questions more interesting so someone has to stop a minute and think about them.
-
Very importantly, provide feedback to the clients on the results of the survey. Don’t share negative themes (unless they are productive and there is something you can do about them) but do share insights, positive themes, or new ideas that have emerged.
A client survey is a very powerful way to connect and learn from clients, but take the right steps to make it as powerful as possible.
Beverly Flaxington co-founded The Collaborative, a consulting firm devoted to business building for the financial services industry in 1995. The firm launched www.advisorssalesacademy.com in 2018. She is currently an adjunct professor at Suffolk University teaching undergraduate students Entrepreneurship 101. Beverly is a Certified Professional Behavioral Analyst (CPBA) and Certified Professional Values Analyst (CPVA).
She has spent over 25 years in the investment industry and has been featured in Selling Power Magazine and quoted in hundreds of media outlets, including The Wall Street Journal, MSNBC.com, Investment News and Solutions Magazine for the FPA. She speaks frequently at investment industry conferences and is a speaker for the CFA Institute.
Read more articles by Beverly Flaxington
Beverly Flaxington is a practice management consultant. She answers questions from advisors facing human resource issues. To submit yours, email us here. 
