The article “Sick of Recruiters,” the Research May cover story, struck me as being out of date. Certainly with all the changes Wall Street has undergone in recent years, the recruiter role has changed as well. Yet, the article refers to “headhunters” and “middlemen” as though all recruiters are working to simply plug advisors into one or two wirehouses.
The truth is that the quality recruiter’s role has evolved as advisors have more options made available to them. It’s no longer enough to set up a meeting or make an introduction — it hasn’t been for a long time. Instead, recruiters are called on to act as a career consultant, a coach, an advisor’s advocate and an agnostic resource to help unearth and explore the nearly limitless possibilities that are available to them.
To be successful, recruiters have to know the ins and outs of the industry as a whole and be able to match the individual to the opportunity — something an online “dating service” can’t do. Likewise, while “traditional” recruiters don’t have their finger on the pulse of the independent space, cutting edge thought leaders have been making the necessary connections and doing the field work in this area for years while still keeping tabs on the wirehouses, regional firms, banks and boutiques.
Some things the article gets flat-out wrong. For one, recruiters’ fees are not paid out of an advisor’s compensation package, but rather come from a separate pool of money paid by the hiring firm.
Likewise, deals are not on the decline. While the industry thought the transition packages paid to advisors peaked last year, it turns out that deals have hit a high-water mark now, and no one knows where they will go from here.
There is not, as the article implies, a negative impact to the advisor for using a recruiter. Instead of seeing a smaller pay package for working with a recruiter, advisors are likely to get a better deal because they’ll be more informed going into negotiations.
Similarly, a quality recruiter can help streamline what is often an overwhelming process, provide unbiased and objective competitive intelligence and analysis, act as an agent for change and ask thought-provoking questions that the advisor might not have thought to consider.
Perhaps most importantly, working with a recruiter allows the advisor to maintain a posture of strength and retain confidentiality during the due diligence process, as the recruiter acts as the front person.
Advisors aren’t sick of recruiters — they’re fed up with headhunters who want to pigeonhole them into a limited number of options. But for recruiters who are willing to keep advisors’ interests at the forefront of their practice, there’s a great demand for their services if they are willing to truly act as consultants and look at the industry as a whole, rather than just focusing on a handful of firms.