Another hint is whether the firm is comfortable letting new advisors chat with staff personnel and ask whatever questions they like. Is the meeting rehearsed, harried and controlled or informal and relaxed? Can new advisors view the work areas or are meetings conducted exclusively in a conference room? Again, these are signs of culture.
Importantly, the relationship has to work for both parties. It's incumbent upon the advisor to disclose any special situations early on in the discussion, for example, if an advisor's business model has a unique aspect, such as a single hedge fund client. The honeymoon period ends quickly. Once the accounts are transferred and locked in, reality emerges.
Something that surprises me in conversations with recruits is how often prospective advisors are ignored by executive management during home office interviews. If an advisor or group isn't worth a little up-front time during the interview process, what are the odds that executives will be accessible after the transition? The cordiality and sincerity of executive management can be feigned, but if they don't even make the effort, it's a sign of indifference, a big red flag.
My business card has my cell phone number on it. Not long ago, we were being interviewed by a large retail group. On Sunday evening at 9, my phone rang. It was the group's senior advisor, checking to see if I would answer. As an organization, you never know what will be most important to a new advisor, but availability is likely a worthy attribute.
When you think about it, there aren't many significant differences among the services, platforms, clearing firms and other resources offered by firms in the independent sector. We all have our different areas of focus, but pretty much the same products and services can be made available on any shelf. The principal differences are reflected in the competence and attitude of the firm's personnel, from the CEO to the operations staff. Transitioning advisors who fail to meet and get to know those people are needlessly gambling with their future.
Before you make the final transition decision, insist upon a visit to the firm's back or home office. Get a feel for their people, for the organization's culture, how they treat each other, and whether they are a good fit for your practice. The reliability and competence of a firm's back office is a key to a successful transition and ultimately growing your book of business.
Terry Buffalo is CEO of First Midwest Securities Inc., a full-service broker-dealer and RIA headquartered in Bloomington, Ill. He can be reached at [email protected] or 800.662.8452.