Over the past few years, various brokerage firms have made the transition to having non-producing branch managers. Although some investment advisors surveyed for this year’s Brokerage Report Card want to see the old model stick around, most have expressed happiness with the change – or wish they could see the non-producer model adopted in their branches.
Advisors who prefer the non-producer management model said it allows their branch managers to concentrate fully on their branch’s business and helping advisors grow their practices rather than dividing their focus and putting a priority on their own business over the needs of the branch.
“My branch manager is a former investment advisor and he’s a partner in the firm. His focus is all about growing the business. He has empathy for advisors and is the best branch manager I’ve ever had,” says an advisor in Ontario with Toronto-based Richardson GMP Ltd.
“Our branch manager is more concerned with the well-being of the branch rather than [with] himself,” adds an advisor in Ontario with Montreal-based National Bank Financial Ltd.
It’s not only advisors who see the shift toward having full-time branch managers as being beneficial. Some brokerage firm executives also are in favour of this trend for several reasons – most notably, the increased responsibilities that branch managers face today.
“The role of the branch manager in the industry has changed dramatically, and my expectations of branch managers have really changed,” says David Agnew, head of Royal Bank of Canada’s wealth-management division, who oversees Toronto-based RBC Dominion Securities Inc. as part of that role. He points out that branch managers need to focus on hiring, building a good team, marketing and working with advisors.
On top of daily business requirements, branch managers have to focus on preparing advisors for the significant regulatory changes taking place, such as the second phase of the client relationship model.
“In the past couple of years, there have been increased regulatory requirements,” says Terry Hetherington, executive vice president of Toronto-based Raymond James Ltd. and head of that firm’s private client group. “In the large branches, with as many as 50 advisors, we felt they would be better served with [full-time] branch managers.”
That approach is one that various firms are employing by placing full-time branch managers in larger centres such as Toronto, Vancouver and Calgary, with producing managers in smaller locations.
Thus, for advisors who work in these smaller branches or with firms that still favour having a producing branch manager, there are mixed emotions about this tactic.
“At our location, we have a producing manager,” says a Richardson GMP advisor in Ontario. “There’s always that question: is he going to spend time on the book or spend time on the branch?”
“[My manager] doesn’t care about what we do and is too invested in his own business rather than in the branch’s business,” adds an advisor in Quebec with Toronto-based CIBC Wood Gundy.
Some advisors say producing managers have a conflict of interest, as they’re competing with the advisors they oversee for new clients or, in the bank-owned brokerages, for referrals from the parent bank.
“[My branch manager] is a producing branch manager, so we’re in competition,” says an advisor in Ontario with Vancouver-based Canaccord Genuity Wealth Management. “He’s not building atmosphere and culture within the branch, or team spirit.”
“It’s a conflict of interest for branch managers to take the referrals, as they’re the ones talking to branch managers at the bank level,” says a Wood Gundy advisor in British Columbia.
But these firms’ executives say there are major benefits to having producing branch managers. Most notably, they have a better understanding of clients’ changing needs.
“We actually like producing branch managers,” says Monique Gravel, managing director and head of Wood Gundy. “Quite frankly, [being a producing branch manager] keeps you close to the clients, it keeps you close to the market and it keeps you close to the issues.”
“All of our managers have a client base, and the culture at Canaccord Genuity is very much a producer’s culture,” says Stuart Raftus, the firm’s president. “Many of our senior executives continue to deal with clients, and we think it’s very important to maintain client relationships at all levels and that this filters down to our branches.”
It’s not only executives who support having producing branch managers. Some advisors also believe it’s beneficial to have branch managers who experience the same challenges as their advisors.
“Successful branch managers have a book of business and also run the branch, and that allows them to understand us better,” says a Wood Gundy advisor in Ontario.
In fact, some advisors whose firms have introduced full-time branch managers are not sold on the idea. Says an advisor in B.C. with Toronto-based TD Wealth Private Investment Advice (TD Wealth PIA): “They’re taking a lot of advisors out of the role. Usually, the branch manager is the person with the biggest book and the most experience. Now, they’re company men with small books who need the extra income.”
However, Dave Kelly, president and national sales manager with TD Wealth PIA, says there are benefits to having full-time branch managers: “There’s a lot of change in the industry and a lot of complexity for advisors on how to grow their business. We believe there’s value for our top producers to [be able to] interact with a professional branch manager.”