As we quickly approach a new year, it seems like a good time to talk about what independent advisors might do differently, so that they can reasonably expect a different, more rewarding result for their labors in 2012.
Following my cover story in November’s Investment Advisor (titled Let Go to Grow), about my P4 Creating Great Employees Program, I’ve received a number of emails from advisors asking: “What can I do right now?” With the caveat that an advisory firm and its owner(s) need to make a long-term commitment to support their employees for true long-term success, here are four resolutions that owner/advisors can make for the upcoming year that will increase employee motivation and create an “owner’s mentality” that will lead to greater contributions to the success of your firm:
Step No 1: Set goals for 2012, and communicate them to your employees at the beginning of the year.
This is a two-part resolution, with both parts equally important. In my experience, not many firm actually set annual goals, and of the few that do, not many make the effort to tell their employees about them. These are two big mistakes. I understand that many advisors feel locked in by setting goals, especially when circumstances can change, or better opportunities can come alone. But, hello! You are financial planners, right?
Rather than thinking of goals as a commitment to be attained, come hell or high water, consider them a road map that helps you decide what to do today. If things change, then alter your goals for tomorrow, just as you would do for your clients. And don’t forget to tell your employees what your goals are—even if they aren’t directly related to their jobs. You’ll be pleasantly surprised with the effort employees will make, and the ideas they come up with, to reach your goals, once they know where you want to take your firm.
Step No. 2: Align your compensation strategy to support your goals.
Generally, advisors have one of three goals: grow their firm (increased revenue), increase their income, spend less time in the office, or some combination of those. (These days, we occasionally see advisors who want to increase the value of their firm, but that’s usually a function of revenues or profits, anyway). Each of these goals suggests distinct strategies: typically attracting new clients, cutting expenses, or leveraging the owner/advisor, respectively.
Once employees are aware of what the goal is, the next step is financially rewarding them for helping you to get there. Most employees will be helpful once they know what the goal is, but their motivation will move to a whole new level when they actually get paid to help make it happen. I’m a big fan of revenue-based bonuses, but whether it’s revenues, profit-sharing, or a performance bonus, if it’s tied to reaching your goal, you’ll get there a whole lot sooner.
Step No. 3: Develop an employee volunteer program.
Employees are happiest when they feel that they are part of something bigger than themselves. That goes for both when they are at work and what they do on their own time. A program that supports employees when they give back to their community is a very low cost way to increase their ties and perception of their firm—and it’s just a good thing to do. Either allowing flex time to support their volunteer work, or actually giving them paid time off to do it, will send a powerful message about you and your firm—even if they don’t ever use it, which most of them won’t.
Step No. 4: Reduce conflicts between your employees’ work and home life by offering the flexibility to meet their needs.
Nothing creates unhappiness in an employee like feeling pulled between work and home. Your goal should be to make coming to work as painless as possible. Your program should start with offering flex time; coming in early, working late, taking long lunches, working from home, working four, ten-hour days instead of five 8-hour days, etc. and include anything that can be reasonably accommodated and works better for the employee. You’re not running IBM here, so stop acting like it. If you can shift someone’s schedule so they can meet their kids when they come home from school, or coach their soccer team, or work out with their husband—do it. It costs you nothing, and your employees will never forget it.
Implementing just one of these steps in the coming year will greatly increase you employees’ bonds with you firm, focus them on your goals and highly motivate them. Adding all of them will put you on the path to creating great employees who will, in turn, help you build a great firm.