A better approach is needed
for training advisors.
By Craig Pfeiffer
Most advisors start their careers in a sink-or-swim environment. The new advisor and the firm have high hopes that the relationship
will go swimmingly, but in reality a majority of
new advisors sink. This must change: The profession needs a new training model that attracts
and develops the next generation of advisors.
The continued success of the profession
depends on it. The current population of advisors is relatively old and requires talent for transition and succession; successful advisors who
are growing their practices need associates to
segregate duties and segment clients.
But how do we re-imagine the development
model? At my firm, Advisors Ahead, we propose
looking no further than preparatory programs in
the medical and legal fields. These professions
have proven the value of a methodical, progressive education combined with practical experiences allowing increasing responsibility.
The model we propose is a structured path
with three components.
Undergraduates begin with a finance-focused
curriculum, and those who are highly motivated
attain their CFP designation. Their campus curriculum is supplemented by distance learning programs delivering courses in emotional intelligence,
a vital capability that helps students establish trust
and build relationships with future clients. Instructors will also emphasize communication and lis-
tening skills. Self-awareness assessments will prepare students to serve
clients’ needs and help them develop consultative selling skills.
Students then gain practical experience through paid in-branch
internships for 10 weeks during their junior-senior summer. This allows
firms to observe candidates at work and participants to get genuine
exposure to the career setting. The intern should maintain professional
decorum, spend at least a third of his or her time completing a predefined set of sample tasks across all facets of the business, and observe
veteran professionals with client-facing experiences.
Once candidates complete their undergraduate degree, they return
to the profession for a transitional “residency” period as a step toward
a permanent position. During this period of one or two years, the resident should be compensated initially at the support staff level and
follow a predefined path, similar to the internship experience. As
the tasks increase in responsibility and accountability, so too should
the compensation. This real-world experience could be the start of a
much-needed succession plan.
Now more than ever, universities need to pair practical experience with academic rigor, and firms need to establish programs that
consider younger, entry-level candidates. There is both supply and
demand; to match it up requires us to think differently about the next
generation of financial advisors. With proper execution, this model
could be a game changer by enhancing the quality of service and
experience delivered to clients. FP
Craig Pfeiffer, a former vice chairman of Morgan Stanley Smith
Barney, is founder and CEO of Advisors Ahead, which provides
student development and job placement for aspiring planners.