• Christy

Using Data to Support Intentional Growth

Updated: Apr 4


A 2021 Charles Schwab Benchmarking Study contained a rather robust section on compensation, polling 1,036 RIAs about 13,000 employees across 27 roles. Though nearly 80 percent of firms surveyed indicated a plan to hire in 2021, early indications suggest hiring needs will not only remain strong, but may intensify even further in 2022.

Many of the study’s statistical findings can be instructive to advisors with a growth agenda that will require adding key talent. For example:

  • Generally, advisors add a new role for every $325,000 in revenue.

  • Compensation accounted for 71 percent of a firm’s expenses in 2020.

  • “74 percent of firms use performance-based incentive compensation” beyond base salary to align teams with firm objectives; these firms saw stronger long-term results.

  • While traditional benefits were table stakes for firms over $100 million, non-traditional benefits had a positive impact on employee satisfaction, including:

  • Location and/or schedule flexibility that supported work-life balance.

  • Career path opportunities that foster professional development and progression.

  • Professional Investment; the median firm ($250 million+ AUM) spent more than $1,700 per professional annually on training, education, and professional dues.

The study also outlined five guiding principles for advisory firm success. These included believing that:

  • Effective planning and execution (supported by a thoughtful organizational structure) is a leading indicator of success.

  • Value delivery is defined through clients’ eyes.

  • Operational excellence creates greater capacity for clients.

  • Your reputation is your brand.

  • People are your most important asset.

The full survey is worth a look for any growth-minded advisor and if there is one theme, it’s that having a value-proposition for advisor team members is nearly, if not as important as having a value proposition for clients. Christy Charise, Founder & CEO of Strategic Advisor www.strategicadvisor.co

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