The keys to the kingdom
Retaining clients is one of the keys to success in running a Financial Planning business.
And the key to retaining clients is to retain key employees. So keeping a happy productive team together, and growing it over time is a major issue for Financial Planning firms.
A survey by LinkedIn highlighted the top reasons why people left their old jobs.
The top three were:
1) Lack of opportunity.
2) Dissatisfaction with the senior leadership of the firm.
3) Dissatisfaction with the work environment or organisational culture.
Not only is it a very tight employment market right now, but good Financial Planning firms are competing against a range of other Financial Services models. And these competitors may have the capacity to pay more than you do. It might be life insurance companies or funds management firms, or old school financial services firms with money to throw at a staff shortage problem. They’re all competing for the people that have the smarts and the skills you’re seeking.
If you’re going to compete against the deeper pockets of those businesses (and you can), you need to work very hard on addressing those top three issues.
Most firms I know could do better at this stuff. That’s not a criticism, just a gentle nudge.
Invest in Capacity
A lot of FP businesses are maturing. That is, they are now passing through £500,000, £1M, £1.5M and £2M of revenue.
Once you reach these thresholds, if you want to keep growing, you’ve got to think about investing in capacity before it becomes an issue. That might mean taking on an extra staff member or two before you absolutely need them, so that there’s time for people to be trained in how you do things. As you grow, your existing team need time to process the existing workload, while also mentoring and training the new hires.
Your long-term capacity planning will involve a comprehensive plan of action to attract, retain and develop the best quality people. Some of those will be experienced people, while some will be apprentices or graduates that might take you a few years to bring up to speed.
Because of the time frames involved, planning your talent management strategy is likely to be a core part of your three-year, five-year, and ten-year strategic planning. It is that big and that important.
I think this issue needs to be moved up the priority list. I don’t see it assuming the necessary level of importance in most business owners current plans. But if you want to grow it’s an essential.
The Expectation Gap
When I speak to business owners, their idea of rapid career advancement is often very different to the ideas of the team members who are looking to advance.
Sometimes the team member has some unrealistic ideas on how quickly they might move ahead to a new role, or into a more senior version of their current role.
However, sometimes the opposite can be said for the business owners. They have unrealistically slow time frames in mind for the person to move on. In their mind, the team member will grind away doing fairly repetitive and uninteresting work in their current role for three more years, because that’s what serves the interests of the business.
You can see the problem. If you take this approach there’s a real risk the person won’t be there in three years.
I realise this is a nuanced issue. There are competing needs and expectations at times.
So how do you square this expectation gap on both sides?
For me it comes down to more honest and frequent communication.
It’s good to talk
As a Financial Planner, one of your core skills is asking great questions. So why not try using these skills with your team members?
Have some more regular conversations asking team members about how they see themselves performing right now in their job. Or where they see themselves moving to in the next 12 months, three years and five years.
If there’s anything that doesn’t seem realistic to you, don’t lecture them, ask more questions.
- What do you think makes a great (insert the job title of your discussion here – paraplanner, adviser, administrator, practice manager)?
- If you had to make a list of the eight core skills that make someone great in that role what would they be?
- Tell me about each of these skills; why are they so important?
- Are there any other skills that might also be important? Any that you’ve overlooked?
- Can you rate yourself in each of these core skill areas? How do you think you stack up?
- Which of these areas might you need to develop to make yourself the obvious candidate if that role opens up?
- What training might you seek out to improve these skills, or to improve the ones you’re already good at?
- How could I support you in that personal development?
- How quickly do you think you can build some of those skills?
Clearly these questions need to be asked with skill and care. Asking them too directly or in a patronising way will defeat the purpose.
However, if asked from a place of “How can I help this person?”, just like you do with clients, you can help good team members discover for themselves the path to moving forward and becoming more valuable.
Business is a Game of Priorities
If you are growing really fast and the team is under pressure what should you do?
This is a real issue for many firms right now.
The obvious answer is to recruit more; good new team members will allow you to handle the new business inflows. However, if that’s not proving possible in the short term, then don’t just keep accepting new business until someone leaves or has a nervous breakdown. You might need to say ‘no’ to new work for a while, or put new clients on a waiting list, or even increase your minimum criteria.
Let me be clear. I’m not recommending this as a long-term solution. You don’t want to be turning away good-quality work. However, you can’t flog people mercilessly and expect them to be happy and stay with you; something will give eventually. That’s not showing care and respect for your team.
Think like a business person, not a salesperson
Maybe you do need to put the brakes on for three to six months while you sort out your capacity issues.
Once that’s done you can make talent management a top-of-the-list strategic priority for you and your business.
Don’t just pay lip service to it. Take some time to create a fully thought out capacity and talent management plan for the next 12 months, three years, five years and ten years.
Let me know how you go.
“Talent management needs to be moved up the priority list for most Financial Planning businesses.”
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