For advisors early in their careers, success depends on their own efforts. But as advisors become successful, continuing success depends not on their performance, but rather on the efforts of their team.

I recently received an email from a successful advisor who is co-managing partner of an 11-person team. That email identified dealing with staff as the biggest challenge, by far, that he has experienced as his practice has grown.

To learn more about assembling and managing teams, I hosted a series of lunches with top-performing advisors to talk about what strategies were necessary to build their teams. The advisors at those lunches identified seven discrete steps to building and running the teams that are integral to their businesses:

1. Establishing the mission and culture.

2. Defining key roles.

3. Setting the right incentives.

4. Attracting and selecting team members.

5. Managing the “onboarding” process.

6. Building team communication.

7. Providing coaching and development.

Once your team is in place, the next challenge is to ensure that its members are performing well.


In the conversations I had with top advisors about making their teams function smoothly, no topic got more attention than how best to motivate support staff and, in particular, the right structure for compensation. There was universal agreement that the feeling of being paid fairly is essential to maintaining the team’s motivation. And all advisors said they provide above-average compensation relative to the market.

That’s where the agreement on the role of compensation ended, however. There was a broad range of views on the split between fixed and variable compensation and how the variable component is calculated. With regard to the mix between fixed and variable compensation, participants in our lunch discussion pointed to a fundamental difference between what advisors are looking for and what support staff want.

Advisors are looking to minimize their fixed commitments by keeping base salaries as low as possible. By contrast, support staff tend to look for the security that comes with a fixed salary that’s as high as possible. As one advisor put it: “By definition, support staff are risk-averse [regarding] their compensation. If they wanted to take risks, they’d be advisors themselves.”

The advisors discussed a number of approaches to bridge the gap on this issue. One response that had heads nodding came from James:

“We tell our support staff when we hire them that our goal is that in a typical five-year period, everyone who works for us will be compensated in the top 10% among people doing similar jobs elsewhere.

“To get that top 10%,” James continued, “our staff have to accept that if the market has a tough year, salaries will not be as high as they’d like them to be – and they must have the confidence that they’ll more than make up for this in average and above-average years.

“That’s why we tell all new hires that we pay a competitive base to start, but that they shouldn’t look for increases in their base salaries. Rather they will participate in the larger pool of compensation dollars that are available as our firm grows.”

Another topic of debate was the calculation of variable compensation for support staff. There were three schools of thought on how to calculate a team member’s bonus:

1. Having it driven entirely by the firm’s overall profitability.

2. Having it driven entirely by support staff’s performance, regardless of the firm’s performance.

3. Employing a blend of the two.

Some advisors were proponents of having the bonus driven by the firm’s profitability, so that in a rough year their exposure is limited.

Geoffrey took the opposite view:

“For maximum motivation, people have to know what their upside is; they have to know what they need to do to get that upside, and getting that bonus has to be in their control.

“We establish key performance indicators, or KPIs, for all of our support staff,” Geoffrey added. “For example, no missing documents in client files for which they are responsible, no compliance issues, all new accounts opened within three days and every client call returned within 90 minutes. Our people know that if they hit their KPIs, they’ll get a big chunk of their bonus regardless of how the firm does. And we think that’s one of the things that keep staff motivated and going the extra mile.”

“It’s about more than money”

Another topic of discussion was related to incentives for team members beyond compensation.

Views on this issue were split, with a minority of advisors very much focusing on compensation as the key motivator for their team.

The majority, however, focused on other aspects of the job to keep their team enthused. Patricia’s view on this topic was typical:

“Cash is simply not enough to keep the best people,” she said. “There’s always someone willing to pay more for top talent. Turnover of staff is terribly costly, both for us and for clients. Once we’ve identified a staff member as a ‘keeper,’ we want to do everything possible to hang on to them.

“And for us,” Patricia continued, “the No. 1 thing that works is flexible hours. As long as people do their job, we let them work from home one or two days a week. And we tell all our staff that if they need to take a day off to attend to a personal issue, provided that it doesn’t get in the way of getting work done, to go ahead. We’ve never had anyone abuse this and it’s a big loyalty builder with our team.”

Other advisors hold quarterly team lunches and dinners to build a sense of camaraderie.

And a number of advisors talked about sitting with their entire team to walk through their annual business plan and to provide quarterly updates on progress, so that everyone knows how things are going.

“You have to give people a sense that their opinion matters,” said one advisor. “And the best way to do that is to give them lots of opportunity to provide input into what the team should be doing and then to keep them posted on what’s happening throughout the year.”

Feedback on performance

Another ingredient to motivate a team was providing feedback on their performance and, in particular, conducting regular performance reviews.

No advisor enjoys this process, but most see the value of letting staff members know where they stand. In some cases, the advisors delegate this function to a chief operating officer, general manager or office manager. As a general rule, however, the advisors conduct these reviews themselves.

Jennifer talked about the importance of balanced feedback:

“Given that all the advisors on our team are Type A personalities and perfectionists, it’s easy to focus on the negatives and things that need fixing. What I’ve learned to do is always to start with the good news and the positive things. Having first mentioned what people on my team have done right makes them much more receptive to the areas that need improvement.”

Paul focused on the importance of talking about things as soon as they happen:

“Before becoming an advisor, I worked for a large company. In my annual reviews, I felt like my boss had stored up a year’s worth of all the things I’d done wrong. So, for us [now], talking about something immediately after it’s happened is much more important than annual reviews. We want to reinforce positive behaviour and address problem behaviour immediately after it’s taken place, while it’s still fresh in people’s minds.”

Whatever you are doing right now in motivating and compensating your staff and providing feedback, consider whether some of these ideas could make your team’s performance more effective in 2017. Investing some time to fine-tune your team processes could pay big dividends in the years to come.

Dan Richards is CEO of Clientinsights ( in Toronto. For more of Dan’s columns and informative videos, visit

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