The job of a top producer is tough. First you have to manage clients. Then you have to manage investments and to top it off, you have to manage staff. Of the three, the biggest land mine is managing staff.
Advisors aren't trained to manage personnel. If you are running a solo shop it's not a priority at first. But eventually you have to hire people as your career progresses. Often you are limited in your staffing choices by your broker-dealer. Typically, your production level determines the number of staff members you're assigned. If you want a larger crew, some firms will let you hire them if you pay out of pocket. Clients don't care about staffing issues, of course. They just want what they want.
In a 30-year study, Gallup found that great client service depends on having highly engaged employees. Engaged employees who provide great service beget emotionally satisfied clients. Another Gallup study of bank customers found that emotionally satisfied customers increased their spending 67% over 12 months, compared with 8% or less by other customers.
Every contact a client has with you or your staff can either add or take away emotional satisfaction. Disengaged employees can treat you, co-workers and even clients with contempt or bad-mouth you behind your back. Gallup's research has shown that if you focus on an employee's strengths you can reduce the number of actively disengaged employees to only one out of 100.
Before you hire someone, have them take a personality and leadership assessment test. When you have the right person in the right role, you want to identify their job tasks and set up an incentive program.
Fact is, 80% of an employee's results come from 20% of their tasks. Identify those top two or three tasks in the 20% and set up a monthly bonus program around them. If one of those tasks is appointment scheduling, you can pay a bonus based on the actual number of appointments you had in the month.
For a group bonus you need to set a bar for the normal growth in your practice. If everyone does their job, you can expect to grow a certain percent, say 10%. A group bonus kicks in once you surpass that growth. If the bar is 10% and you grow 11%, everyone would get an additional 1% of their base salary as a bonus. If you grow 20%, it would be an additional 10% of their base. The nice thing about this model is that you pay bonuses from a larger pie. I recommend group bonuses be paid quarterly, based on quarter-to-quarter performance.
Paying someone will get them to apply effort, but that effort needs to be focused on the right task. You can provide focus by your feedbackin a negative or positive context.
Social recognition conveys both respect and approval of that effort. It could be recognizing a job well done at a staff meeting or a simple email praising a performance. Remember that to provide outstanding service, it's critical to have a staff that's engaged.
Todd Colbeck is founder and principal of Colbeck Coaching Group, a subsidiary of General Business Center. He can be reached at firstname.lastname@example.org