For new recruits, the practice management development program includes training, coaching and assessment, which helps young advisors build critical wealth management skills and knowledge that is essential for attracting affluent clients, the Merrill spokesperson said.
Finding a solution
While these programs may seem like a solution, Scott Smith, a senior analyst at Cerulli, believes that many firms in the industry are not approaching the shortage of talent in the correct way. Smith says that firms should start building programs to support inexperienced advisors rather than experienced veterans.
Recruiting top talent will still be a big part of their strategies, but the firms need to complement those experienced advisors with an increased focus on developing new advisors as well, he says.
Junior advisors should not only be paired up with seasoned advisors, they should also be designated specific responsibilities. "New advisors should be placed on the administrative side so they have enough time to learn about a client before working with them," Smith says. "The senior advisor should be given the time to work closer with a client to make the transition process easier."
The Cerulli report points out that adding new recruits to a team "is not directly about business development so much as efficiency." For instance, during preparation for a client review, the junior advisor can scrutinize the client review package for any issues or errors that might pop up and "highlight them to the senior advisor ahead of time," Cerulli says in its report.
But, industry recruiter Mindy Diamond throws out this caveat. While she feels that the pairing up of new recruits with experienced advisors can benefit firms in the future, recruiting advisors without real life experience can pose a serious problem for the firm. "The lack of life experience and lack of a rolodex of connections sets these young kids up for failure," Diamond says.