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Finding the ‘right’ fit

11 December 2023 Gareth Stokes

One of the best ways for a financial or risk advice practice to tackle its growth and / or succession challenges is to identify and hire the right employees. And one of the presentations at the 2023 Financial Planning Summit, hosted virtually by The Collaborative Exchange, focused on exactly that: finding the right talent for your business. The presentation by Gavin Walker, an asset management and private equity recruitment specialist at Walker Phillip, was titled ‘Financial advice is an attractive career; but top talent does not believe us’.

Painting the talent landscape

Walker, who confessed to having completed over 7 000 face-to-face interviews in a career spanning almost 18-years, set out to “paint a bit of a picture” around talent and trends in financial services recruitment, as well as share some of the operational challenges facing financial services providers (FSPs) and recruitment firms when making new hires. He said he would consider the presentation a success if each attendee could leave feeling “a bit more confident of being better recruiters to their business, so that they could hire the right people to both grow their firms and hire for succession planning with confidence”. 

Walker conceded that “by and large, most wealth managers and investment firms have found recruitment challenging over the last 24- to 36-months”. This experience was repeated at firms regardless of brand, performance or size with a common theme being that firms were struggling to find any talent, let alone convince said talent to join them. One of the issues facing advice-focused financial services firms is that top talent is in demand in a range of industries that may have been inaccessible to them pre-COVID. “Talented workers are demanding remote work; hybrid work; are switching to different industries; are emigrating or semi-grating; and are getting multiple offers when they do come to the job market,” he said. 

Recruiting people in South Africa is even tougher because many employees are risk averse, preferring to stick to the devil-they-know rather than job-hopping during uncertain economic times. “Potential hires are a little bit worried about the South African economy, and the idea of changing jobs is a bit foreign to them at the moment, let alone trying to convince them to join a small financial advice firm in [what most people perceive as] a sales role,” Walker said. The intense war for talent has been compounded by many companies expanding their operating ‘remit’ in the post-pandemic world. 

More than just a bank or insurer…

So, for example, Tesla is not just a motor vehicle manufacturer, but an artificial intelligence (AI), data and technology ‘play’. And many financial product providers have evolved into data mining and machine learning outfits as they strive to achieve better lifestyle outcomes for customers rather than simply pushing product. Firms’ responses to emerging technologies have thus contributed to the talent war, with large firms like Amazon entering the local market and offering big salaries to lure the best people. In the financial advice context, Walker commented that local banks and insurers were already able to pay new hires well above what advice practices could offer for entry level positions. There is, therefore, a real risk that small financial, investment or wealth advice practices will struggle to hire talent in coming years, adding fuel to the ‘merge or acquire’ trend. 

The trick to getting people to join the industry, according to Walker, is to improve the industry’s image, beginning with breaking down negative perceptions. “Typically, when someone hears the phrase ‘financial adviser’ they are actually hearing ‘sales’ which to many people is another word for psychopath,” he said. PS, Walker used the word psychopath throughout, but he could just as well have used masochist, as in ‘someone who takes a sales role must really enjoy inflicting pain on themselves’. Whatever the case, those in the recruiting game often struggle to convince new hires that financial planning is a fantastic career and are forced to explain away a wide range of concerns and reservations in the process. 

Rolling out the red-carpet for potential hires

How do you emerge victorious from the fast-paced talent ‘hunt’ to successfully ‘bag‘ the next you? Walker offered some useful pointers, including that the first meeting with a potential hire should be with the CEO or founder of the practice rather than an HR lead. “You need to make the first meeting a red-carpet experience, and the best way to achieve this is for the decision maker, founder or CEO to do the first-round interview,” he said. For firms that insist on multiple interviews with division heads, the suggestion was to ensure that diaries were cleared to expedite or fast-track the interview process. 

Other pointers included conducting professional, structured interviews; making a firm job offer as soon as possible after the interview process completes; to check the potential employee’s references; and to make a decent offer. “You have gone to a lot of trouble to find the calibre of person you want on your team, so you need to swing the bat hard at offer time,” Walker said. Finally, he warned against becoming despondent during the recruiting process, saying that you often have to “kiss a few frogs to find that prince or princess”. 

It was refreshing to glance over the skills that a specialist recruitment agent goes in search of when scouting for talent for a financial advice practice. Walker explained that the perfect hire had to be able to wear numerous ‘hats’ in his or her workday including operations; marketing; compliance; research; asset allocation; building out proposals; offering a shoulder to cry on; providing worldly advice; and having some investment knowledge. One of the mistakes that firms tend to make is to ‘mix up’ the soft versus hard skills they are seeking from a new hire. “It is the soft skills that are hard to coach, learn, replicate or excel at,” Walker said. 

It turns out the ‘soft’ skills are hard to find

Soft skills include the ability to ask great questions; listen for understanding; not jump to assumptions; influence outcomes; resolve conflict; build trust and credibility; and articulate value-add services to clients, to name a few. And then, of course, there is something that Kobus Kleyn CPF® so often advocates for, which is a passion for the financial planning profession. You need to find a recruit who mirrors your passion for helping people to achieve financial wellbeing, and to realise their goals and dreams. “A successful financial adviser must have a high degree of empathy, emotional intelligence and the ability to remain neutral when it matters; these are the traits that we are looking for,” Walker said. 

Nowadays, discussions about careers, jobs and recruitment are held against the backdrop of an evolving technology trend that will forever change the employment landscape. Case in point: in March 2023 global asset manager Goldman Sachs published a report that predicts a staggering 300 million jobs are at risk of being replaced or diminished by AI over the next five to 10-years. 

Should advisers and advice focused FSPs be concerned? “There was a brief moment in time when the whole advice industry was worried about Robo-advisers taking jobs,” Walker concluded. “Now we hardly hear the term. Yes, AI is going to come in; yes, it is going to replace certain facets of your practice and what you do; but AI does not yet have the soft skills you have, and it is these skills that are the hard skills to master”. 

Writer’s thoughts:

Conversations about the challenges and opportunities in the financial planning recruitment realm can be enlightening. Do you agree with the assertion that finding suitable new hires to drive growth and / or ensure succession in your practice is increasingly difficult? And why? Please comment below, interact with us on Twitter at @fanews_online or email us your thoughts editor@fanews.co.za.

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