What You Need to Know
- After 14 years with LPL Financial, the head of National Sales and Consulting plans to retire next month.
- He describes top lessons learned from LPL CEOs Dan Arnold and Mark Casady, as well as Voya Financial CEO Rod Martin.
- The 32-year industry veteran discusses what he's enjoyed about his career and what lies ahead.
Kalbaugh won’t have one successor. Instead, LPL is having several executives take over his responsibilities, which are being incorporated into broader initiatives to support advisors and their growth strategies.
When he started at LPL in 2007, the firm had about 5,700 affiliated independent advisors. “We’re now at over 17,000. The expansion of that [advisor base] and the skill sets needed [to support it] are really important,” he said, adding that he believes LPL has the required executive talent in place and thus feels “pretty comfortable” about the timing of his departure.
Known for his friendly, supportive demeanor as an executive, Kalbaugh spoke recently with ThinkAdvisor about some of his career highlights, as well as the management skills and industry insights he’s learned from others.
This includes current LPL CEO & President Dan Arnold, the broker-dealer’s former leader Mark Casady (now with Vestigo Ventures and Lefteris Acquisition Corp.) and Voya Financial Chairman and CEO Rod Martin.
His ‘Nice Guy’ Reputation
When asked about his affable approach to business and working with others, Kalbaugh said he thinks he was “born with some of that personality, whether that’s my upbringing or whatever you want to call it. I like people, and I think most people want to help people.”
Before and during his time as CEO of the AIG-owned broker-dealer American General Securities (1995-2007), he saw “as an executive, you want to be viewed as a person that people trust. They need to know you genuinely care. … Once [people] know you care, then they generally tend to open up, and you can make some deposits into their personal banking account.”
That is helpful, Kalbaugh says, “because there are times that will require me to make a withdrawal. If I make a withdrawal while having made a bunch of deposits, that makes the withdrawal a little less painful.”
He says he learned about this dynamic from Voya’s Martin, who could speak easily and effectively to Wall Street analysts, and from former AIG CEO Hank Greenberg.
Martin’s most critical advice to him? “You need to [make deposits in others]. And the good part is that it’s free.”
While good leaders don’t always say yes to others, “they know you’re going to try. If I say, ‘I’m not doing this one,’ but … I’ve treated you fairly along the way, that’s usually easier [for them] to understand.”
As a leader, “You need to have that give and take, because it is not always an easy street. I want to make sure that I can get things done. And [this approach has] worked well. It’s who I am, but it’s also been a very conscious effort on my part.”
Reflecting on what is most influencing the financial services business, Kalbaugh points to “the velocity of change.”
“I’ve done this [work] now for 30-plus years. Look at where this industry went from — when I was a wire operator punching in trades to [be sent to] an exchange floor — to today, when our advisors can do this at a beach in Tahiti or elsewhere on a laptop. It’s a very different world,” he said.
At a leadership seminar he attended with LPL CEO Dan Arnold a few years ago, two things jumped out at him. “However fast you’re running now, run faster; [your current speed] ain’t fast enough,” Kalbaugh said.
Plus, “If anything, change will accelerate. So you’ve got to look at people and process and talent and systems,” he explained.
LPL, of course, isn’t immune to these trends. “It’s hard to stay a market leader. We’re trying to make sure we’ve got the best team on the field to create the best firm we can to help our advisors and institutions. It feels pretty good, actually,” he added.