The direction of the still-new industry of holistic financial advice is pointed toward growth and maturation. The financial planning firm of today is a sophisticated business. While entry into the industry may not be as easy as in the past because of new compliance requirements and knowledge specialization, there are more working positions within each firm.
Two decades ago the usual (and probably only) roles in a financial advisory practice were planner (employee or business owner), all-purpose, generalist administrative assistant and paraplanner. To give some perspective, CRM systems and documentation software — or even broad thoughts about practice management issues — were either primitive or unheard of.
The industry is going in wonderful directions. Some owners have realized that they can't do it all efficiently and have developed positions that play to different people's strengths. Determining the best personnel mix for your practice depends on effectiveness — considering who really should be on your team and what you can outsource.
Today's financial planning firm could involve all or some of the positions below, based on size and growth ambitions. These positions could be as employees within the firm, or performed by consultants or contractors.
Executive team. This group, formerly just the owner as chief executive, might now include a chief financial officer, chief operations officer, chief technology officer and even a chief marketing officer.
Planning and investment analysis. Members of this team may complete financial plans and perform investment research, etc. The team could include a financial planner (senior, associate or junior); specialists in such areas as tax planning, estate planning, executive planning or business planning; a fund manager, a staff member in charge of portfolio construction or an investment specialist.
Client service contact. This person serves as the link between your practice and your clients, and may have the title of client service specialist, manager, director of first impressions or administrator.
Human resources. Bringing together a larger team may require allocating more resources toward managing it. You want to keep the good team you've spent so long finding and cultivating, so make sure you address people's needs, help the team succeed, and encourage them to learn from mistakes. You also want ensure they stay up-to-date on benefits, rules and regulations. HR staff members could include a director of human resources, an office/firm manager and supervisors, a personnel manager and a human resources specialist/generalist.
Financial and operational. Staff members in these roles measure results of business initiatives, revenue (and how the business revenue is being used), and planning goals and investments for the business. On the financial side, positions may include a controller, an accountant and a bookkeeper.
Technology. People in these positions offer technological expertise and understand/communicate how the technology in place or under consideration works to fulfill the business plan. They know what to use for maximum effect and how to troubleshoot and resolve technology issues.
Business development. Titles for these growth-oriented strategists might be business development planner, manager or team member.
Marketing. Whereas marketing was once the responsibility of the owner/planner, some firms now hire or outsource these duties to a marketing manager, marketing support specialist or assistant.
Whom you bring on to your team (now and in the future) and what their relationship to the firm should be — employee, contractor, consultant, vendor — depend on a number of factors. What is the size of your firm (how many clients, partners, etc.)? What are your plans for business growth? Do you want to develop talent or hire experts? What outside resources do you have access to? What fits with your clients' lifestyle and expectations?
We're seeing more core employees being hired for their expertise, and others coming to the financial advice industry from previous careers. Many roles in an advisory firm carry increasing authority and decision making, and compensation — considerably higher than even a decade ago — now is often tied to the firm's success and personal success. This might include base compensation for core tasks, incentives for getting results and benefits that employees desire.
The “tried and true” core roles of financial planning, client service and business development have always been a key part of the business — although their responsibilities weren't always broken down into individual roles. Still vital today, these positions would benefit from greater mentorship — scarce in the industry these days — and the financial planning profession needs to consider real investment in them for our industry's future success.
Mary Dunlap, of Mary Dunlap Consulting, helps financial planning firms attract, develop and retain the best people for their teams. She can be reached at [email protected].
