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Is Your Firm One of the Best Places to Work?

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How can you attract the best employees to your firm? What are the “best practices” in our industry? Few advisory practices are led by experienced business managers, making tangible guidelines hard to come by. At the same time, the industry is experiencing an acute talent shortage.

In today’s market, advisory firms must compete for talent against employers of all types. You may need to look outside the industry for tips on hiring and retaining critical employees. Start by evaluating your firm’s management practices against those of other companies. Where would you rank? If nothing else, the comparison will provide insight into where you are succeeding, and which areas need development.

One of the leading wealth management firms in the country, Altair Advisers, recently participated in the 2018 Crain’s Best Places to Work study of the Chicago business community. They were ranked 52 out of 100 businesses in their market, an impressive achievement. The companies in the study range from technology, to construction, to marketing design, to management consulting.

While much of Crain’s evaluation focused on the fundamentals each company offers, another critical measure was participation rate in the company’s employee survey. In Altair’s case, 88% of their 50 employees responded, a powerful testament to positive employee engagement.

To learn more about Altair’s success, I spoke with its CEO Beka Kohmescher, CFP, CFA. Beka and her partners formed Altair in 2002 upon leaving the large accounting firm Arthur Andersen. In creating their business plan, they culled the best management practices they learned from their Andersen years and added an entrepreneurial element. Empowerment, empathy, continuous learning, and opportunities to grow form the core of their philosophy.

Beka looked beyond the industry for further guidance. She cites Who: The A Method for Hiring by Geoff Smart and Randy Street as a particularly helpful resource. This book, based on more than 1,300 hours of interviews with more than 300 CEOs and managers, outlines a multitude of successful hiring practices. Altair follows many of the recommendations in their human resources strategy.

For one, Altair has implemented an “employee scorecard” to help all staff members focus on the mission and key outcomes of their specific jobs, and to foster the behavior that is aligned with the firm’s stated values. Beka emphasizes that high performance alone does not make an optimal employee. To work on Altair’s team, “They must be collegial, respectful, and act as if they are empowered as well. If they are jerks, they will not work here.”

Of course, individuals are not put on the chopping block for a single violation of Altair’s culture. Realistically, team members work with demanding clients who have high expectations; occasionally colleagues inadvertently may offend one another as they strive to meet deadlines or solve problems.

Beka understands the pressures and emphasizes the big picture. “Our focus is on remediation to help people learn how to be more effective communicators and less abrasive and abusive. The goal is to make us all better, not find a reason to get rid of somebody.”

Making it Work

Altair builds strong connections with its associates. This helps them to retain high-impact employees, a critical dimension in a profession suffering from a talent shortage. For example, when a key employee had to move away from Chicago because his spouse took a new job elsewhere, Altair came up with a way to keep him.

As Beka says, “We do not want employees to get in their head that they have to quit working here when these situations arise. In this case, we proposed a work arrangement that allowed this person to do their job from a remote home office and also commit to spending one week a month in our Chicago office.” This commitment to employees benefits everyone involved.

Another dynamic aspect of people development at Altair is their conscious effort to expose all staff members to different areas of the firm. The partners believe this helps each individual develop skills and become well-rounded in their approach, which is especially important for advisors guiding clients though complex choices. It also creates valuable advancement opportunities for employees.

Even on the service side, Altair has developed a career matrix. Beka refers to this structure as a “career vine” rather than a “career ladder”: a good metaphor for how individuals evolve and emerge in their roles.

Altair creates a clear description of what excellence looks like in each job, making it easy for both leaders and employees to set goals and track progress. This philosophy enables employees to grow within the company, and helps all parties define next steps when an employee is ready for a new role.

Altair’s compensation also supports the firm’s desired culture and objectives. “Compensation is a hygiene factor,” Beka says, meaning that it’s important to pay fairly and competitively but not pay specifically for revenue generation. Altair offers a base salary plus a bonus.

The bonus is funded out of firm profits. This represents a meaningful trend in the RIA segment of financial services as opposed to the brokerage environment, where practitioners are paid on a production grid even when they charge their clients a fee for services.

Growth Track

Altair demonstrates a strong commitment to a high standard of service. Individuals on the partner track must have at least two professional designations such as CFP, CFA, CPA, or a law degree. The firm emphasizes continuing education and will help employees pay for higher professional status. In addition, partners consciously model the optimal attitude and behavior. This preserves and embeds the culture with each individual.

Within Altair, the client-to-partner ratio is approximately 30-1. Typical clients, high-net-worth individuals with complex financial lives, require comprehensive support. To that end, a team supports each partner in delivering services. Altair believes in a standardized client experience, so every employee works with every senior person. The staff members follow the protocol for working with each client.

This also ensures that Altair’s clients view the firm as their provider. “They are clients of Altair,” Beka says, “not clients of the advisor with whom they work.”

Finding the right people for the team is an important factor in Altair’s success. Three people take part in the decision to hire a new client-facing employee.

A scorecard helps to evaluate each candidate according to the same metrics. Multiple interviewers provide useful perspectives on what the firm needs. While background, education, and credentials rank high, hiring managers also focus on potential, teachability, and communication skills.

As for regrettable hires, Beka brings an interesting perspective. “Most businesses hold themselves to a ridiculously high standard of retention,” she says. “Think about it, only half of all marriages work — and that is usually after months of courting and getting to know each other. We often make hiring decisions after short one-on-one interviews and background checks.”

She stresses the need for diligence in the candidate evaluation process, but advises acceptance when a person just doesn’t fit. In this situation, it’s not productive to beat yourself up over the loss: “Recognize it early,” she counsels, “and clean it up.”

At the same time, Beka cautions against pushing people out without regard to their circumstances or the impact on the firm. “I’m obsessed with the idea of a graceful exit,” she says. “A two-week notice is crazy. We need more time to find replacement talent and we want the exiting person to be involved in the training in many cases.”

When possible, Altair tries to help the person who is exiting — whether at their initiative or Altair’s request — find their next job. They even allow them time during the workday to interview elsewhere.

The future of the wealth and advisory business depends on how its leaders address the talent shortage. Individual firms must build organizations that provide opportunity, offer a learning environment in which staff can hone their skills, and foster behavior that will improve the reputation of financial advice as a profession.

As Altair demonstrates, firm managers may have to look beyond their peers for guidance and examples of effective practices. Altair’s results prove this prudent thinking.

Not only have they experienced phenomenal client and revenue growth over the past five years, but employees are engaged and clients feel secure in working with a company that values their staff. A strong team benefits clients, employees, and the firm as a whole, drawing talented new hires to your door seeking the next “best place to work.”


Mark Tibergien is CEO of BNY Mellon’s Pershing Advisor Solutions. Tibergien is the author most recently of “The Enduring Advisory Firm,” written with Kim Dellarocca of BNY Mellon and published by Wiley. He can be reached at [email protected]


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