A recent story in the July/August issue of the Harvard Business Review received national attention. Researchers Monika Hamori, Jie Cao and Burak Koyuncu conducted face-to-face interviews with some 1,200 “high-achiever” 30-something employees. They found that “three-quarters sent out résumés, contacted search firms and interviewed for jobs at least once a year during their first employment stint. Nearly 95% regularly engaged in related activities such as updating résumés and seeking information on prospective employers.” Worse, “they left their companies, on average, after 28 months.”
This didn’t come as much of a surprise to me. As a member of the 30-something crowd myself, and after working with hundreds of similar employees, I’m fully aware that the experience of today’s young employees is vastly different from that of their employers and older peers. Owner/advisors who understand these differences and use them to their advantage have a far greater chance of attracting and retaining the high-achieving young financial planners of this generation.
For one thing, social media has made finding new jobs easier than ever before. New job postings, hirings and firings in every industry go viral at a speed that would boggle the minds of most baby boomers. The independent advisory community is no exception. Keeping track of the job market—and occasionally testing it—is as much a part of the lives of today’s young advisors as buying the newest Beatles album (whatever that is) was for the older generation.
What’s more, against this backdrop of at least the appearance of non-stop opportunity, today’s young advisors more often than not find themselves in jobs so far behind their digital world that it’s very easy for them to become frustrated and disengaged. Through my work with the Kansas State University financial planning program, I’ve come to realize that today’s students are even learning in a different way than I did only a decade (or so) ago. Today’s students don’t simply take their teachers’ word for facts: They’ll Google it and challenge the teacher in real time. The Internet has made information so readily available to them that it doesn’t have much value anymore: how to use it or apply it is what holds their interest now. To retain them at an advisory firm, owner/advisors need to take this into consideration.
For example, we recently hired a Kansas State graduate in one of my client firms. She’d made straight A’s and was at the top of her financial planning class. Unknown to me, in her first week of work, my client decided she wanted her new employee to become an expert in IRA conversions so she could work directly with clients, telling her so and giving her a book to read on the laws and rules governing getting benefits.
Rather than read the book, this young advisor Googled “IRA conversions” and read about them from many sources including the government itself, realizing along the way that the book she’d been given was seriously out of date in a number of key areas. When she presented her findings, rather than test what she’d learned, her boss became outraged that she hadn’t read the book, demanding that she do so and write a “book report” on it—a book report!
Let’s see how many mistakes you can spot that the owner/advisor made in this example: I count five. Her first mistake was that she assigned an area of expertise to a young advisor (or anyone) without getting the advisor’s buy-in. If you need a junior advisor to do some research, that’s one thing. To have someone become an expert in a particular area—financial planning, investments, taxes, retirement, insurance, etc.—you’d better find out if it’s something they have an interest in. Without that, how much of an expert do you think they’ll become? Equally as important, how happy do you think they’ll be doing it? I’m hard-pressed to think of a faster way to get a young advisor looking for a new job.
Of course, since the owner/advisor in question sprung this area of expertise on her new employee, we can reasonably assume it did not come up in the hiring process (actually, I know for sure that it didn’t). Note to owner/advisors: You just can’t make this stuff up as you go along. Some readers may wonder whether this really needs to be said, but sadly, it does: The time to think about what expertise a firm requires is before you hire a young advisor. Then you have the luxury of hiring someone with that expertise, or at least someone with an inclination to become the expert needed.