Edward Jones will not develop its own robo advisor, Jim Weddle, head of the firm, tells On Wall Street.

That decision puts Edward Jones, which has about 14,000 advisors, in the same camp as Raymond James. Earlier this year, Raymond James said that it would not join the robo market as Charles Schwab and other industry players have done.

However, Weddle still anticipates that competitive pressures from digital startups and others will force his firm and others to find ways to meet clients' digital expectations. Here, Weddle talks about how the St. Louis brokerage is responding to the robo challenge while reevaluating its long term plans, which includes an attempt to grow to 20,000 advisors with $1 trillion in assets by 2020.

HOW WILL THE RISE OF ROBO ADVSIORS AFFECT YOUR FIRM?

I see robo in two different ways. I welcome the current volatility, the confusion caused by the news, because that defines very clearly the value we provide. We help people stay invested and to make new investments. This is what it feels like a tough market. In one way, I look at it and think … can robo automated advice provide the [same] quality of the support and guidance? I don't think so.

But robo advisors will push everyone, us included, forward in terms of the quality of the tools and the functionality of the desktop to benefit the advisor.

BUT IS IT A COMPETITIVE THREAT TO THE EDWARD JONES MODEL?

There are dozens of competitors out there and they will be one of them. For a certain segment of the population it will be very attractive, I'm sure. There will always be the do-it-yourself individuals who are not coming to Edward Jones or Morgan Stanley or Raymond James. They want to do it themselves and are willing to invest the time.

Our clients are extremely intelligent and one thing they know is what they don't know. And they know they want help from a sophisticated professional to help them meet their goals.

WOULD EDWARD JONES CONSIDER DEVELOPING ITS OWN ROBO ADVISOR?

If it is an alternative distribution team to our advisors and branch teams, then no. We think we offer value in guidance and advice. An 800-number and algorithm isn't going to replace our folks.

YOUR FIRM HAS A GOAL OF REACHING 20,000 ADVISORS BY 2020. ARE YOU STILL ON TRACK TO MEET THAT OBJECTIVE?

We are refreshing our 5-year plan and will be redefining our plan.  We are well on our way to hitting all of [of our goals], but we will not hit all of them by 2020.

WHICH ONES WON'T YOU HIT?

Last year, we grew by 842 advisors. This year, we're obviously not done, but looking at the pipeline, attrition is very low. We will grow by 600 advisors. We've raised the quality of the individual we're offering our opportunity to. We're finding some great people out there, but not as many as we like.

We're ahead of pace on assets under care. We're on track in terms of deeply served households. And when we say that it means finding and serving our clients on multiple needs.

Twenty-thousand [advisors] – I don't know if we will hit that by 2020, but we will hit it shortly after that.

WHY ARE YOU NOT FINDING AS MANY NEW RECRUITS AS YOU WOULD LIKE?

It's difficult to find the right people who are both excited to be in the business and the willingness to work. We can teach the skills and knowledge, but the willingness has to come from them.

Just looking at the last few weeks as the market has gotten volatile … people are saying, "I don't know if I want to make a career change." I understand that, but we will still have some success finding and hiring the right people.  We're looking in the same places, but we just have to work a little harder to do the work and find the people who will fit the business model for the firm.

For us, it is still a much more attractive way to grow than acquisition because we are protective of our culture and values. Those things can get damaged if you grow through acquisition.

EDWARD JONES HAS LONG ESCHEWED THE RECRUITING GAME THAT OTHER FIRMS PARTICIPATE IN. WILL YOU AMP UP RECRUITING ADVISORS FROM OTHER FIRMS TO MEET YOUR GROWTH OBJECTIVES?

That's a zero sum game. That's why the industry dropped by 2.5% advisors last year. Some retired, some passed away. But if you are just recruiting from your competitor across the street, you're not adding anything.

Look, we've got an unprecedented generational wealth transfer [coming]. The industry is shrinking and it makes no sense. We are going to grow organically. Yes, we will bring in some people from other firms, but we're focused on organic growth. I wish some of our peers would be more focused on bringing in new people into the industry.

But training is expensive, and it takes resources and patience. A lot of firms don't have that. But we're a partnership and can make those kind of longer term decisions. We are responsible to our clients but we are accountable to ourselves. I'm not building shareholder wealth here. We're building wealth for our clients. So if we do that, everything else will take care of itself.

As a partnership, we don't have to cater to quarterly earnings.

--Editor's note: Part of this interview appeared previously online.

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