The broad trend of going digital has certainly touched the retail financial advice industry recently, with a continued focus on automated investing and robo-advice solutions.
With that said, much of the novelty associated with stand-alone digital tools is expected to fade, as these solutions become more commonplace and expected. When this happens, financial advisors who can successfully incorporate similar technologies into their own practices while also maintaining the knowledge and experience to create simplicity out of chaos will be in a position to thrive, as providers of a truly advice-centric client experience. This will be the case in particular for financial advisors who can develop the right staffing and organizational structure, including with respect to identifying and cultivating the next generation of professional talent for the industry.
These professionals are what some in the industry refer to as the “master advisors”—professionals able to balance the deep foundational expertise with softer skills, such as an understanding of how changing consumer demographics impact their businesses. By combining these attributes with technology, advisors can ensure they’re able to build a holistic financial plan and select the best possible asset management solutions. In the independent channel, these advisors tend to be the ones who build truly recognizable brands and practices of enduring value.
So how can financial advisors who are in growth mode reinvest in their businesses to become master advisors? Consider the following:
1. Bring on board energetic, talented “next generation” junior advisors. While there are no easy answers for how successful independent financial advisors can grow by bringing on board smart and qualified younger professionals who are eager to embrace this profession, there are encouraging signs on the horizon in this regard. At the same time, other advisors have become more proactive in identifying and mentoring younger administrative staff who display the potential to be coached towards becoming FAs, and in some cases, looking for new talent in adjacent industries who theoretically have transferrable personality traits and professional skills, from real estate to financial product wholesaling and beyond. Perhaps one of the most successful practices when it comes to identifying next generation talent is to look at younger talent pools than the industry may have considered previously. Over the last two decades, financial literacy and personal finance-related education has become more commonplace, especially in undergraduate studies. Certain well-established advisors are actively building bridges with newly-formed college level CFP programs to recruit their best and brightest graduates, while also establishing ongoing, year-round internship programs, especially where there is a great local college that draws area students with a strong work ethic and a sense of entrepreneurialism.
Equally important, aspiring master advisors have been quick to grasp that an increased focus on “emotional intelligence” and “non-technical skills” in the advent of technology resources and tools taking on more of a major role with more routine or day to day FA functions means that there is more potential in looking beyond the typical business administration degree programs and recruiting students who have backgrounds in academic fields such as psychology, and certain liberal arts.
There’s probably no single magic formula that can—on its own—address the need to build a next generation of advisors, but there are many independent advisors out there who are showing initiative with a variety of these initiatives, and they could very well be better positioned than the rest of the pack when it comes to creating a long-term, enduring business.