For years, financial advisors surveyed for Investment Executive‘s Brokerage Report Card have expressed significant dissatisfaction with their firms’ “back office and administrative support.” That trend continued this year, with advisors citing several long-standing complaints once again: communication issues with the staff in the back office, understaffed departments and slow service.
On average, advisors gave their back office a performance rating of 7.9; however, they rated it much higher in importance, at 9.1. The difference between the two numbers, known as the “satisfaction gap,” was 1.2 points, the second-largest gap among all the categories in the survey.
The difference becomes much more striking when examining the satisfaction gaps among the individual firms for this category. This examination reveals the firms that have the most work to do to meet advisors’ expectations. Montreal-based National Bank Financial Ltd. (NBF) and Toronto-based firms BMO Nesbitt Burns Inc. and TD Wealth Private Investment Advice (TD Wealth PIA) all had the widest satisfaction gaps, at 2.4.
NBF advisors rated their back office at 6.6, with several advisors citing language barriers as a major reason why they’re unhappy with their back office.
“There’s a disadvantage to being English-speaking in a French-speaking firm,” says an NBF advisor in British Columbia. “Sometimes, you get poor service.”
However, this should not be happening, says Yves Néron, chief operating officer with NBF, who notes that the firm has two call centres that will direct back-office requests. One centre is in Toronto and can respond to English-speaking advisors; the centre in Montreal can assist French-speaking advisors. Says Néron: “It’s really up to advisors to select which service they want from the back office.”
In addition, many NBF advisors said their back office cannot keep up with the workload stemming from NBF’s acquisitions of Wellington West Holdings Inc. and HSBC Securities (Canada) Inc. in 2011. “Maybe it’s just the major expansion in the non-French side of the firm,” says an NBF advisor in Ontario. “But with these recent acquisitions, they’re probably challenged for capacity.”
TD Wealth PIA advisors also have felt the pain of an understaffed and, in many cases, slow back office. In addition, many of that firm’s advisors cited the occurrence of frequent errors, which contributed to a rating of 6.7 for the firm’s back-office department.
Says a TD Wealth PIA advisor in Ontario: “They consistently screw up transfers. We’re over here constantly having to be on them. It’s like babysitting the whole time.”
The firm’s plan, says Dave Kelly, TD Wealth PIA’s president and national sales manager, is to change this tone by emphasizing the back office’s part in producing a “legendary client experience.” This is to be accomplished through the firm’s “client impacting, [as measured by the] client experience index,” which was introduced last year and will measure employees’ contributions to the client experience.
“[The index] provides direct feedback, both to operations individuals from the front line as well as to leaders of operations in terms of areas of opportunity,” Kelly says. “And we have started to wire that directly into compensation plans for operations employees.”
Meanwhile, the back-office concerns of Nesbitt advisors include inexperienced staff, an inadequate number of employees and slow turnaround times. These factors contributed to the firm’s rating of 6.6 in the category.
“The problem is purely efficiency. We have very good staff but they’re understaffed,” says a Nesbitt advisor in Atlantic Canada. “Clients get fed up when one-day things takes three days.”
Nesbitt executives were unavailable for comment.
Although many advisors said that their back offices are not up to par, advisors with Calgary-based Leede Financial Markets Inc. and Vancouver-based Odlum Brown Ltd. said that their back-office departments meet their expectations in every way. Leede advisors rated their back office at 9.5, equal to the importance rating they gave the category. And Odlum Brown advisors rated it at 9.3 in performance and 9.2 in importance.
Advisors at both firms say their back-office departments are well run with supportive employees.
Furthermore, back-office staff at both firms are eligible to become shareholders in their firms. Debra Hewson, Odlum Brown’s president and CEO, says this eligibility helps to maintain a partnership culture at her firm: “We’re pretty generous in our profit sharing. We’re not just retail partners; we’re partners across the board.”
Leede advisors also appreciate the competency and the quickness of their firm’s back-office employees. Says an advisor in B.C.: “They are really focused on helping the broker. They’re all cross-trained and very professional.”
Bob Harrison, Leede’s president and CEO, attributes his firm’s back-office success to this cross-training, through which employees are taught to perform multiple roles within the department.
“It just makes it more efficient and things get fixed quickly,” Harrison says. “There’s not a lot of different people to go through to get something done.”
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