Virtually every experienced advisor has at some point suffered the challenging financial and non-financial impacts of staff turnover.
The estimated financial cost of turnover, depending on the source, can range from one to three times the departing team member’s compensation. This is not the most detrimental cost, though — even worse is the psychological impact frequent turnover has on firms and how it causes existing team members to lose confidence in their leader, makes it harder to recruit new talent due to a perceived impaired culture and employee-unfriendly reputation, and leads to an overall downward spiral of morale.
Most turnover stems from unclear roles and responsibilities; insufficient screening for skill and cultural fit; lack of clear expectations; and poor management and mentoring.
The Status Quo
The typical approach to creating a job description and divvying up the workload involves having each current team member submit a list of things they do not want to do, now or in the future. This list gets compiled and then someone is hired to do all of those things.
There’s nothing inherently wrong with this approach, with the exception that sometimes the list is overwhelming. Instinctively, firm owners know it is probably more than one person can take on, but plunge ahead regardless to keep human capital costs low.
Hint: If the list of responsibilities is more than a page long, break it up into multiple roles.
Don’t Hire to a Moving Target
In this tight talent market, hiring the right fit is daunting enough when clarity exists around the role and responsibilities, so firms are adding an unnecessary layer of complexity to their hiring by taking this “we’ll-create-it-as-we-go” route. It is impossible to attract and screen the right candidates for a position that is not defined.