Wealth management continues to move toward a supported independent model, where long-term success will be determined by more than just the economics of a transition deal. Given the industry’s current supply-and-demand dynamic, top-producing advisors are positioned to be selective, and they are increasingly looking beyond the financials and choosing their partner firms based on culture, support, development opportunities and innovation.
In practice, this means the industry’s next phase of growth will belong to organizations that invest in people, not just platforms, while also encouraging advisors’ natural entrepreneurial spirit. Providing the freedom and flexibility advisors need to build their practices, care for their clients and define success on their own terms will separate the winners from the rest.
Firms often focus on getting the platform part of the equation right. Advisors expect a total wealth management platform that is simplified and seamless. They want access to an open-architecture advisory platform with a suite of solutions covering a full range of holistic client needs, from insurance and annuities to investments and financial planning.
An innovative tech stack has become table stakes for many advisors looking for a partner. Firms have responded by enhancing their support and technology to allow advisors to provide the personalized, seamless and comprehensive services clients now demand.
It’s relatively easy to put the latest enhancements in the hands of advisors. It is much more difficult to build and maintain an enduring culture.
But in the rush to add the latest AI capabilities and cutting-edge digital technology, firms can overlook the human element that is at the core of this relationship business.
That’s the limitation of innovation: It’s relatively easy to put the latest enhancements in the hands of advisors. It is much more difficult to build and maintain an enduring culture based on values that resonate with advisors as people.
The best partner firms are dedicated to helping their affiliated advisors by promoting a culture that empowers and celebrates individual success. That’s because, while innovation is critical, it falls flat without trust that the firm is looking out for the best interests of its advisors and their clients.
In today’s dynamic financial landscape, advisors need a supportive culture that understands rising expectations, evolving client needs and fast-moving markets. They need to know their firm is willing and able to invest in the resources necessary to help them thrive on their own terms.
Advisors want to partner with a firm that values the important work they do every day. They want meaningful support for their client relationships and a service culture that prioritizes advisors. This can be difficult for some firms to maintain as they grow larger in our consolidating industry. Advisors therefore need to determine what matters most to them and be willing to make a move when they find a better fit.
Culture is an easy word to throw around, but much harder to define. Competitive compensation and benefits can be a compelling piece of a firm’s culture. Community can be another. So too can engagement throughout the year, where achievements are celebrated and peer-to-peer collaboration and sharing are encouraged.
Benefits Of A Team Culture
Some firms embrace a culture of collaboration by teaming advisors, believing that when people work together, greater outcomes are possible. By working in a team environment, advisors have the potential to accelerate growth, share knowledge and serve clients better.
Advisors working in teams reported 88% more in combined production than their solo peers.
In fact, Prudential Advisors own analysis was clear that advisors working in teams reported 88% more in combined production than their solo peers, along with higher average assets under management.
Operating within a team-focused culture allows advisors to support each other and tap into the expertise their clients expect and deserve. Done mindfully, a team approach can provide advisors with access to experts who deliver coaching, consulting, tools and resources to help accelerate both their career and personal growth. Teaming can also make recruiting, talent development and succession planning more efficient and effective.
Creating A High-Performing Entrepreneurial Culture
As experienced advisors continue to move away from the traditional wirehouse models, firms that compete on platform alone may find themselves at a disadvantage. Elite advisors are entrepreneurs at heart. They are looking beyond the nuts and bolts of a firm’s platform and placing greater value on the intangibles that shape their day-to-day experience, such as freedom, flexibility and control. They rightly view themselves as small business owners who need autonomy in how they serve clients, build teams and grow their practices.
Some may launch their own RIA. Others will flex their entrepreneurial muscles without taking on the added administrative, operational and compliance risks of going it alone. Attracting these advisors may ultimately come down to culture.
A robust platform is crucial, but it can be bought. Culture is nurtured and built on shared values. With the right amount of support for advisors, strong culture can translate into lasting trust. And in a wealth management industry where much is becoming commoditized, trust remains a true differentiator.
Pat Hynes is the President of Prudential Advisors, with a network of over 3,000 financial professionals.
