“Given this expectation, firms need to prioritize retention strategies and invest in elements of their business that will enhance this effort,” the report emphasizes.
If money can be saved on compensation packages for advisors who are lost, it should be used for technology that frees advisors from mundane administrative tasks and enables them to focus on clients and prospects.
“Improvements in broker/dealer’s technology and product offerings can be worthwhile ways to add value to advisors and increase total retention,” Cerulli says.
The wirehouses, which have already lost advisors, could lose more because of mergers and acquisitions. One quarter of the advisors believe the merger and acquisition activity at their firms had a negative impact on their business, Cerulli says. To retain their advisors broker/dealers must ensure that mergers and acquisitions do not negatively affect the advisor’s preferred business practices or their clients, the study says.