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A Cool Place to Work: How Advisory Firms Are Attracting, Retaining Top Employees

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How is this for a dream job? Unlimited paid leave. Time off for philanthropy. Friday afternoon chair massages. And that’s just the icing on the cake. Imagine creating a culture where empowered employees have the opportunity to do what they do best every day.

No, we didn’t make this up. Advisory firms, at least the forward-thinking ones, are developing innovative, intentional—and often inexpensive—initiatives to create employee buy-in, loyalty and goodwill. One frequent result? Peak performance.

“If you look at a profit and loss statement, 70% of all expenses go toward human capital. If you can get a better return from the investment, the firm is going to be in some cases significantly more successful,” notes Tracy Beckes, who coaches financial advisors from Tracy Beckes and Associates in La Conner, Wash. “It’s extremely important. But it’s got to be a thoughtful process.”

The process starts with hiring the right person in the first place. “Most advisors don’t know how to hire properly,” says Beckes. “Most hire who happens to show up and ask for a job.” The danger of not making the right hire: workplace drama, gossip, blaming and complaining, indicators that employees aren’t in the right job for their talent and skills.

Just as important as hiring right is the creation of an environment that includes clearly defined roles, recognition for jobs well done, a set career path, and participation in the strategic direction of the firm.

As Joni Youngwirth, managing principal of practice development for Commonwealth Financial Network, observes: “Employees want to know what’s expected of them. They also want to know how they are performing on the things that are expected of them. They need to understand what the business plan is. That way they’ll understand that their little piece is part of something bigger. They get how what they do day in and day out contributes to the mission and vision of the firm. ‘I don’t just do paperwork, I do paperwork that helps our clients achieve their most important financial goals.’ That’s huge.”

Another big piece: Employees want to feel that they are valued. Often, that means giving employees a certain level of autonomy along with a pat on the back when deserved.

Matt Halloran, who heads Top Advisor Coaching in Omaha, Neb., suggests advisors put a reminder on their computer screen to deliver positive feedback at least once a week. “It’s a huge culture-building tool that’s a small thing,” he says. He’s also a fan of off-site strategic retreats that involve a third-party. A business professor at a community college, for example, can provide a big add at a modest cost. A retreat, according to Halloran, provides a healthy venue for setting goals and analyzing firm strengths, weaknesses, opportunities and threats. Moreover, every employee should have a say at the strategy sessions.

“Feeling appreciated goes a long way with employees,” adds Matthew Stegmeier, a consultant with Stegmeier Consulting, a workplace management expert in Cleveland. “Just being flexible to employee needs is important. You see more and more top talent demanding work/life balance. It’s okay sometimes if you have to leave early to take a kid to baseball practice. If you view that as a concession, you’re really missing the point. This is an opportunity to change your organizational culture. When employees have a say and feel empowered and part of something special, that’s when you have true buy-in.”

Here’s a look at four advisors who are at the leading edge of workplace innovation:

Building a Bond

When she opens an employee meeting, Abacus Planning Group President Cheryl Holland first asks everyone to practice a “relaxation response,” a breathing exercise that calms. Then she has them giggle, either by watching a funny video or by using techniques of a “laughter club,” an India-based movement that promotes the health benefits of laughter.

“To me, I feel an immediate difference,” says Holland, whose Columbia, S.C.-based firm has $700 million in assets under management. “It’s energizing.”

At least once a quarter, Holland takes all 25 people in the firm on what she calls a mini-sabbatical. The togetherness has included a hike through a national swamp with a park ranger, a tour of the renovated South Carolina statehouse, whitewater kayaking, laser tag, cooking and dancing lessons and a waterfront workout with her personal trainer.

“When you’re in a collaborative environment, you need to think of ways to make connections. We’re all team members here; it’s not a silo. We’re all very dependent on one another. You may not sit next to so-and-so but to walk with him is very powerful,” says Holland. “Also, this is a very intense industry. I think you need a way to let steam out in healthy ways. Secondly, I want people to be loyal, to have pride, to have energy. I want people to get out of bed and say ‘I can’t wait to get to work today.’ Doing this does all of that.”

Holland also uses a corporate psychologist to assess the “cultural fit” of prospective employees. The process includes screening for personality, IQ and skills. Just recently, the firm hired a talented CPA advisor. Part of her job description was to write a newsletter. Screening, however, showed that was not her strength. “We knew out of the gate not to do that,” says Holland.

Once a year, Holland holds a “360 degree” peer review, at which everyone comments on their colleagues. “When you hear from a peer, people pay a whole lot of attention. Feedback is a gift, and it can be painful,” she acknowledges. “But it’s very helpful to me because it gauges the mental health of the firm.”

Showing Appreciation

Advisor Adam Koos drew heavily on his own experience as an employee when he started Libertas Wealth Management Group in 2004. The biggie? “I didn’t like people telling me what to do. I liked people asking, always with a ‘please.’ Rather than telling an employee to do something for me or for a client, I ask them: ‘Can you please help?’ Everyone likes to help if they’re asked,” says Koos, who is headquartered in Dublin, Ohio. “No one likes to help if they’re told.”

Libertas has an office manager and a client service associate. A third employee is about to join the firm. Koos says he would be lost without them.

“I’ve always looked at my company and how much I appreciate what my employees do for me and how much of a mess I’d be without them,” he says. “Aside from increasing pay, I’m always thinking about what more I can do.”

With his employees’ approval, Koos in 2010 scrapped a longtime policy of three weeks of paid leave for unlimited paid leave. In effect, he says, they actually take less time off than before. “They don’t feel they have to use them or lose them so they don’t feel they’re losing anything,” adds Koos, who oversees $41 million in assets. “I think they also appreciate how much I respect them and their time off. Sometimes I literally have to tell them to go take a day off, leave. It’s like we’ve created a little family here.”

In a move to encourage creative thinking, Koos also established an “above and beyond” program where Koos rewards exceptional employee service with a bottle of wine, a gift certificate to a spa or restaurant, a case of beer or a car wash. One recent example of over-the-top service: a beautifully bound book of news articles about the firm that now sits in the lobby for clients to peruse.

“One other thing that’s sort of hard to quantify is that I’m always asking for their opinion,” Koos adds. “I never realized how little other companies do this. But I’m so aware of how imperfect I am, I’m all over the place half the time. Definitely, I don’t always know best. They have great ideas about strategic initiatives that we all care about. It’s like they are partners.”

Creating a Culture

With $685 million in assets under management and 20 firm “members,” as they are called, Center for Financial Planning in Southfield, Mich. considers itself a “one-firm firm” that treats employees like they are employees of a business and not employees of an individual advisor.

There is a flex-time policy, financial support for the pursuit of new credentials and learning opportunities, an incentive compensation formula and structured career paths for all positions.

“We want to service our employees the same way we want to service our clients. After all, they have as much or more contact with clients as we do,” says Melissa Joy, a partner and director of investments for the 27-year-old firm. “I really think if you are going to be a modern firm, it’s critical to put yourselves in the shoes of an employee.”

It’s a culture that is anything but static. This past April, for example, every employee was involved in a half-day retreat involving the firm’s vision for 2020. “What better way to have buy-in than to get it from the get-go?” observes Joy.

Center for Financial Planning also launched an employee satisfaction survey that resulted last year in enhancements to its benefits package. Among them: formalized bereavement time; time off for community involvement; the opportunity to take a sabbatical after seven years of service; and increased time off for life balance concerns and professional growth.

“One of the ways that we like to think about it is we like employees that have intellectual curiosity. We’re in an entrepreneurial business. Intellectual curiosity isn’t something that starts when you are a principal,” Joy says. “We want to encourage and reward innovation. We want to grow our leaders from within.”

Joy is an example of that. She started out as a client service assistant 13 years ago. Today, she’s an owner.

“We have a lot of friends in the business and lot of people talk about their successes as an employer but they’re always bemoaning their high turnover,” she adds. “We don’t experience that and we think there is a reason for it.”

Empowering Employees

The four partners at Monument Wealth Management in Alexandria, Va., spend a lot of time on employee development for the obvious reason: Employee turnover is disruptive and expensive.

To help build loyalty and encourage creativity, the firm this summer gave its five employees one Friday off during June, July and August that does not count against vacation or personal days. The practice may continue year-round. Employees are also empowered to spend up to $300 to fix any client issue without a partner’s permission. And, this fall, Monument is launching “Innodate,” an idea inspired by workplace expert Daniel Pink that lets employees take off one day a quarter to innovate something they are passionate about.

“I’d love for it to be about Monument Wealth Management but, in reality, I want them to innovate anything they are passionate about. The caveat is the next day they have to come in and present to the entire practice what they innovated,” says Managing Director David Armstrong, whose firm has $250 million in assets under management. “It goes to the loyalty thing. What a lot of people are really reluctant to do is take a job where they are going to be ground down and where people don’t care about the contributions they are making. We say let them innovate and be creative—that’s what human beings want to do.”

Brittany Kaschak, 23, was hired as an administrative assistant at the firm a little over a year ago. She is currently being groomed as brand manager. Her take?

“They give me exactly what every employee wants: decision-making latitude and time to recharge my perspective on life. They have respect for us,” she says. “What I get here is freedom and the opportunity to be able to make decisions, innovate, explore my interests and passions. It allows me to come into the office refreshed—and ready to bring my best.”