In last month’s column, “Diamonds in the Rough,” I wrote about our dramatic new strategy for reorganizing independent advisory firms. Diamond teams match a senior advisor and two lead advisors with a single associate advisor whose primary job is to sit in every client meeting, taking notes and learning how to be a lead advisor.
Originally designed as a solution to better train young advisors to work directly with clients, we found that in practice diamond teams offered additional benefits such as creating a clear career track for young advisors, a succession plan for lead and senior advisors, an exit strategy for owner-advisors, increasing productivity of all advisors—and consequently making diamond-team firms employers of choice for many young advisors.
As I mentioned last month, it’s not easy to get firm owners to buy into paying associate advisors to mostly sit in client meetings. What I didn’t talk about then is that to get the many benefits of diamond teams and to operate at maximum efficiency requires one more step: to create and staff a fully functional back-office support group or, as we call it, “centralized client service and operations” (CCSO).
The goal of client service specialists is to take as much off the plates of our advisors as possible so they can focus on servicing their clients, attracting new clients or managing the firm (in the case of owner-advisors). We’ve built CCSO departments for all of our client firms, whether they use the diamond team structure or not. They more than pay for themselves in advisor productivity and—as a bonus—make their lives easier.
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In all of our client firms, the non-professional staff works in our centralized client service departments. They handle all the contacts with custodians or broker-dealers and other vendors, keep the technology systems fully operational, enter financial planning data into software, maintain CRM files, and perform routine client contact such as taking phone calls and emails, setting up appointments, creating and mailing or emailing communications, and gathering information or documents. The sole responsibility of client service specialists is to ensure that every client of their firm feels they are getting the best, most personalized service possible.
The majority of these CCSO positions are filled by non-professional employees such as administrative people and client service or operational representatives. Generally, these employees have little desire to become professional advisors. Instead, they prefer the relatively low stress and shorter hours of back-office work. This dedicated support staff greatly increases the experience and expertise of our back offices, while it reduces both employee turnover and the training and retraining commonly associated with hiring support advisors who eventually move out of these roles into advisory roles.