Merrill Bets Big on on New 'Level Up' Training Program

So far, the firm has conducted a pilot training program with about 400 advisors who are three to five years into their career at the firm, utilizing “faculty” drawn from advisors who are six to 10 years into their time at Merrill Lynch and who have at least doubled their own assets in the past 10 years. Moving forward, advisors will be trained across a total of four length-of-service cohorts, and in addition to learning from successful and longer-tenured peers, advisors will receive training from a team of home office practice management consulting professionals.

“I couldn’t be more excited and optimistic about what we can achieve through this new training program,” Correa said. “It’s the right time to be rolling out this program, because with higher market volatility and the accelerating wealth transfer between generations, financial advice is at a premium today.”

Here are some additional highlights from our discussion, edited for length and clarity:

THINKADVISOR: Can you talk us through the structure of the Level Up training program and how you expect it will benefit advisors at different points in their career at Merrill?

KEN CORREA: Absolutely, it’s all about meeting advisors where they are today and providing them with training and support resources across four distinct groups according to their length of service. These groups are made up of advisors with three to five years of experience, six to 10 years of experience, 10 to 15 years of experience, and then 15-plus.

It makes a lot of sense to divide up these segments, we believe, because advisors across these segments need help with different things when it comes to maintaining strong growth.

Take the three- to five-year tenure group. These are relatively new advisors who are generally focused on client acquisition. They need to bring in clients to grow the business, and so we’re pairing them with advisors in the next tenure cohort who have already successfully doubled their business. In addition to the training itself, we’re creating peer groups and action plans that help trainees hold each other accountable for enacting what they have learned.

With the six- to 10-year cohort, on the other hand, these are advisors who already know how to bring in clients. They know how to prospect and win clients, but they need to learn how to take the next step and create scale in the business. We just launched our first group of trainees in this length of service cohort.

With advisors in the 11- to 15-year cohort, we’ll be focused on things like building effective team dynamics and creating almost that CEO mindset, since these are advisors who have more sizable businesses. Then, with the 15-year plus group, it evolves again, and we will be focusing on things like inorganic acquisition skills or evolving what have been successful service models to the current moment.

Again, it's all about meeting advisors where they are today and creating a sense of accountability and community around our shared growth and client service goals.

What does the course load look like at each tenure level? How do you select the advisors who will be trainers?

To answer the second part quickly, we’re drawing on advisors who have successfully doubled their business over the last 10 years, and each cohort is going to be trained by advisors who are in the next tenure level. We’re doing this purposefully to make sure the training is relevant and relatable, because you’re going to be learning from highly successful advisors who were in your shoes not long ago.  

Regarding the course work, we’ve designed this as a four-month program organized on a weekly basis. Each week, we’re going to be digging into a specific growth strategy or practice management technique that has specific expectations and deliverables, and there will be peer group discussions and follow-up to make sure people are putting what they learn into practice.

The training is delivered in live-but-virtual sessions driven by the advisors and members of the practice management team. Overall, as I said, we’re trying to create a real community atmosphere around the program.

One thing that is constant across the different cohorts is the fact that financial advice is no longer about picking stocks and managing assets. That’s been commoditized. You win new clients and retain clients on high-quality and holistic service — by having a clear value proposition and delivering on that with real consistency and responsiveness.

Our goal is to help advisors truly become that one-stop-shop for all of their clients' financial needs and aspirations, so that they don’t need to pick up the phone and call elsewhere to get the planning support they need. If we can do that, I’m very confident we’ll achieve our goal of doubling our business in the next 10 or even five years. If we provide them with the best platform and the best training, there’s no reason why all our advisors can’t do this.

Could you say more about the firm’s growth ambitions and exactly what it will take to double the business?

Yeah, how I like to talk about this is to kind of use pretty simple numbers. To put it simply, in order for somebody to double their book of business over this kind of time period, they have to grow revenues at about 15% per year.

Let’s assume an advisor in one of the early cohort has hit $1 million in revenue. To grow at 15% this year, that will mean achieving revenue growth of about $150,000. If a normal market is giving you, say, half of that just in terms of returns, you need to make up the other half in terms of incremental revenue gains.

So, that’s about $75,000 in new incremental revenue that you need to achieve, and average industry revenue on assets stands at about 1% today. Therefore, to get that $75,000 in additional revenue at an average ROA, that’s $7.5 million in net new money per advisor coming into the fee-based programs.

The fact of the matter is that our advisors far exceeded that threshold last year, so with this increased focus on training, I’m very optimistic that this is achievable. When we think of the links we have to Bank of America and what our own platform brings to the table in terms of the tech we have and the legacy trust company we have, I have no doubt that we’ll get this done. I’m an optimist by nature, but I do believe this is very realistic as a goal.

And I’d also point out that, in a volatile market like what we are experiencing today, it’s honestly the best time for wealth management. Advice is at a premium in moments of heightened uncertainty like this. Everyone thinks they know everything about investing when the market is just going up and up, but people start to seek support when uncertainty comes to the table. That's where we're at right now.

As advisors, now is the time to be on the front foot, both because of the volatility and disruption but also because of the great wealth transition. All of a sudden, all these formerly self-directed investors are coming off the sideline and seeking the help of a professional. People are seeking guidance and support as they think about stewarding their wealth across generations, and we are here to support them every step of the way.

Pictured: Ken Correa