Wall Street hates when the competition attracts away big producers. The largest brokerages spend a lot of money poaching advisers from rival firms.

As a recruiter, however, I've seen these so-called recruiting wars also keep firms on top of their game.

A competitive marketplace incentivizes firms to continually upgrade their platforms and technology to reel in top performers, Elzweig says.

Ever take a look at the insurance industry? Wirehouses never worry about a major insurer stealing one of their brokers. Insurance companies can't compete with the service the large brokerages provide clients, including a dizzying array of investment products and technological support to advisers.

That's because insurance agents and many advisers at insurance-owned BDs sell proprietary, non-transportable products. If they move to join another firm, they would lose their trailing (back end) commissions on those products. That’s why there is relatively little movement in the insurance industry and why insurance companies don’t have to give their reps top flight wealth management platforms.

However, Tom Naratil, President of UBS Americas, has taken issue with the way competition drives recruiting within the wealth management industry.

Naratil recently announced that beginning in 2017, his firm would be boosting adviser payouts and dramatically scale back its recruiting efforts.

Read more: UBS raises adviser pay as part of sweeping changes

He also said in an exclusive op-ed in On Wall Street that clients and the industry were not served well by "relentless recruiting," which has become " an unhealthy obsession." Moreover, he argued that adviser recruiting programs offer no direct benefit to clients. Going forward, he plans to refocus UBS's efforts to retain existing advisers and to better serve investors.

Read more: Voices Naratil: Enough with 'relentless recruiting'

I can assure you that his competitors will not mind if UBS takes a step back from the recruiting game.

Now it's always a good thing when a firm earmarks resources to support advisers and their clients. They need love too. UBS, in fact, typically is home to advisers with fees and commissions in excess of $1 million. It also has lower profitability than competitors like Merrill Lynch and Morgan Stanley and needs to do something about it.

A competitive marketplace incentivizes firms to continually upgrade their platforms and technology to reel in top performers. The best advisers will not tolerate firms that don't offer them the resources to properly service their clients, or companies that aren't striving to improve and innovate. For example, firms are starting to pour more money into technology, due in part to the rise of fintech startups. And competition has firms increasingly willing to accommodate recruits with big books of business and the special needs of their clients.

Advisers meeting with prospective firms often provide important intelligence about the job benefits they want and the services they would like to get for their clients. This can lead to a wirehouse broadening its UMA or alternatives platform, causing rival firms to notice and possibly do the same. Those firms that build cutting edge platforms and technology to help their advisers better service clients are typically rewarded for their efforts as recruits flock to join them.

As advisers distance themselves from the old broker model to reinvent themselves as life planning coaches, they will seek firms with technology that frees them from mundane tasks and allows them more time to interact with clients.

And strong recruiting packages will continue to help them land the firm of choice. They make the transition with greater confidence and ditch companies that are laggards in their offerings. That's how recruiting wars can be a boon to the industry, helping both advisers and their clients.

Mark Elzweig

Mark Elzweig

Mark Elzweig is president of executive search consulting firm Mark Elzweig Co. in New York.