In the financial advice industry, the star performers are usually client-facing advisors. Just as the largest contracts in football go to those who score the touchdowns, the best compensation and career advancement opportunities seem in the financial advice industry to go to those who bring in clients.

The contributions of operations and administration people, on the other hand, can be more difficult to define and measure. ESPN will always tell you who scored in a soccer game, but you will never see the name of the goalies on ticker tape.

And yet the easiest way to lose soccer games is by having a bad goalie.

In the same way, operations and administrative employees often struggle to measure and show their contribution, even if everyone has a sense that their contribution is valuable, especially as firms grow.

As a result, the industry is accumulating experience in developing career tracks for non-advisory staff.

In the future, in fact, the CEOs of large, successful independent advisory firms may not even be advisors, but people drawn from the operarations ranks.

There are many talented, ambitious and dedicated second-generation professionals in the industry, and they are challenging the notion that you need to be a client-facing advisor to be a leader.

So how is the industry creating career paths for operations people? In this article, we will try to find out.

Who Are The Non-Advisors?
Non-advisory positions include all the staff responsible for:

• Client service administration. This includes all custodian interactions. These administrators also gather and maintain client account data and other data and they respond to general service requests.

• Technology staff. These professionals select and implement all information systems such as performance reporting and trading, CRM, planning and e-mail, as well as hardware. They also increasingly oversee the security of all systems and client data, and their ranks include the chief technology officer (CTO).

• Investment operations staff. These staffers may include traders.

• Human resources. This includes all staff responsible for employee recruiting, training, performance management, HR compliance, payroll and benefits administration. The director or senior director of human resources is included here.

• Marketing. These professionals coordinate and implement all marketing strategies, including a firm’s website creation, content creation and distribution, its events and other marketing efforts.

• Accounting and finance. This department includes the chief financial officer of the firm.

• Compliance and legal. This department includes the chief compliance officer and legal counsel.

• General administration.

• Office management. This includes managers overseeing all office functions. In smaller firms, they oversee the entire administrative area of the firm.

• Operations. This includes the chief operations officer of the firm—i.e., the person overseeing the entire staff.

The impact of these professionals is felt throughout an advisory firm. In the largest firms in the industry (“super ensembles”) they account for almost half the total staff (22 out of 49 employees) according to a 2016 survey of the industry sponsored by Pershing and produced by the Ensemble Practice. Inside the largest firms, operations and administration staff account for more than $2.5 million in total payroll on average or of 12% of the revenue of the firm.

For this reason, every firm should be ensuring that its non-advisory departments are staffed with talented and motivated employees. Again, this means that there must be a career track in all areas of the firm.

Are There Careers in Operations?
A “career” by definition means growth in a person’s scope of responsibility, and then in status and income. For someone to become a manager or a leader he or she needs to have people to manage or a team to lead. But too many firms bestow promotions on employees simply because they are performing well and have accumulated tenure in the firm. For example, when I joined my previous firm Fusion, every single employee had the title of director or managing director. All five employees. But what were they director of? Whom were they managing?

Inflated titles do not help either the firm or the employee. They often create unrealistic expectations about compensation. Even worse, the employees themselves realize the positions are really no more challenging than lesser ones and come with no actual rewards.

Some professional businesses, accounting firms for instance, add a partner for every million or more in revenue. This ensures that for every partner there is a team to manage and a scope of activities to match the title. While this may seem mechanical, advisory firms should also consider some similar method that allows staff to gain responsibility as their firm grows.

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