Survey Shows The Most Successful Advisory Firms Are Investing In Talent


It seems to be a self-fulfilling cycle. The more you train, retain, and pay your people, the better they can court and keep richer clients.


According to the study, sponsored by Pershing and conducted by Moss Adams and Investment News Adviser Solutions: firms that have taken the time to build traditional human resources initiatives -- an org chart, performance reviews, defined promotion paths -- tend to beat those that have not done such planning.


The study points to "top human-capital firms," advisory frms executing best practices in human resources, firms that have created incentives for employees as well as clients, "people businesses.".


According to the study, top-human capital firms manage an average of $220 million and generate $2 million in revenue annually, a far outperforming  financial perfromance of the average RIA, which manages $142 milion and shows $1.1 million in annual sales.


As the study notes, results are skewed somewhat by the fact that small RIAs have neither the resources or nor immediate need to build elaborate human resources programs for one or even two advisors. A one-advisor firm generating less than $250,000 in revenue need not focus on "human capital."


Still, the numbers provide some useful lessons, not the least of which is the importance of creating a thoughtful HR strategy.


Along with the data, Investment News is running a slideshow on what the 700 firms they talked to pay their management teams.




This Website Is For Financial Professionals Only