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Hosted by Financial Advisor Coach, Ray Sclafani, "Building The Billion Dollar Business" is the ultimate podcast for financial advisors seeking to elevate their practice. Each episode features deep dives into actionable advice and exclusive interviews with top professionals in the financial services industry. Tune in to unlock your potential and build a successful, enduring financial advisory practice.
Ray Sclafani (00:04)
Welcome to building the billion dollar business, the podcast where we dive deep into the strategies, insights and stories behind the world's most successful financial advisors and introduce content and actionable ideas to fuel your growth. Together, we'll unlock the methods, tactics and mindset shifts that set the top 1 % apart from the rest. I'm Ray Schlaffani, and I'll be your host.
career pathing and team incentives. How important are these to you and your firm? This year, I had the great privilege of facilitating a breakout session at the Barron's Team Summit in Las Vegas. The panel featured three industry heavyweights, Jeff Brown, president of Stratos Private Wealth, Tony Parr, partner at Parr McKnight Wealth Management Group, and Jeff Price, managing director of Merrill Wealth Management, who runs one of the largest teams at
These high -performing leaders shared invaluable insights that I'm excited to share with you today. Our conversation spanned a range of topics, but focused specifically on how to go about building teams for sustained success. The first part of our discussion centered on insights about career pathing and incentivizing certain team behaviors and outcomes, while the second part focused on designing more effective compensation structures.
Following are some of the highlights from the conversation that resonated with me and I thought would be valuable to share with you in hopes they might spawn new ideas for attracting, retaining, and incentivizing your teams. Additionally, if you'd like to receive one of the client -wise tools we shared with the audience, check out the show notes in this episode and click on the Prioritize People Plan Evaluator. Jeff Brown, President and Founding Partner at Stratos Private Wealth,
said, when you look at your people, younger team members in particular, what they really crave are clear career paths. They want to know exactly how to get from point A to point B. It's something, until recently, that's really been lacking in our industry, he says. Let's be honest, the days of new advisors having to cold call their way to success are history. And Jeff would know he was a cold calling cowboy with two headsets on his ears at the same
So with the help of firms like ClientWise, he says, we've invested a great deal of time and effort in designing career paths from the ground up for all employees. The key is to craft career paths that are very, very specific. At Stratos Private Wealth in the private wealth division, he says, we've created three tiers of associated advisor roles, level one, two, and three, before transitioning into the lead advisor role.
Before they even start with our firm, says, advisors understand precisely what will be expected of them at each level, how long it will typically take them to progress to the next level, and exactly what their compensation will be at each level. And he says, we do the same with our client service team. They conduct two to three reviews a year, formal performance reviews, grading performance related to each individual aspect of their role on a scale of one to five.
Only when somebody consistently earns fours and fives across the board, are they even eligible for promotion. The response he says has been phenomenal, providing team members with much more clarity about what they need to do, what they will receive, and when they will likely get it. It's proven to be an incredible motivator. How much of a motivator, you ask? The current COO started out as an intern in the office. So great insights there, career paths, the track.
the recognition, the rewards, the measurement, all are key ingredients to building sustained success. Tony Parr, partner at the Parr -McKnight Wealth Management Group shared, four of their firm's CFPs are today equity owners and are all former interns. And the next two soon to be CFPs also started out as interns. Each of these gentlemen, both Jeff and Tony have taken a long view in attracting
retaining and developing talent, promoting that talent when it's the right time. Tony says, we've built a pretty robust farm team of which he's immensely proud. And they're moving in the same direction as Jeff's firm in relation to career pathing and periodic reviews. One of the first things Tony wants to emphasize is the importance of creating a flexible work environment. He says, I'm someone who's been on the cusp between the baby boomer and Gen X generation. So he says, I was reared in
If you're not in the office until 6pm every night, you're really not working mindset. He says, but times have changed and it's important that we adapt. So he says, we accommodate our team with incredible effects, flexibility and work life balance. At the same time, he says, we know that collaboration, culture and camaraderie aren't formed over zoom or Webex meetings. He says, if you truly aspire to a leadership role, you must physically be in the office, not working remotely.
He says, we've built our office environment to encourage that with individual offices for everyone, glass walls to let lots of light in and sit to stand desks. Additionally, he says we've crafted benefits that help differentiate our firm. Now check a few of these out. They're interesting. From matching charitable contributions and a donor advised fund, which by the way, all 13 members of their team weigh in on distributing to underground heating, marketing, well, a nice perk if you're in Minnesota.
and unlimited free books at Amazon and Audible, and free lunch in the office every day to help build unity and culture. Additionally, they actually offer pet insurance. All kinds of crazy ways to think about attracting, retaining, and rewarding talent. Again, not so crazy if you've got team members excited about these benefits. Again, base and bonus comp are important, but so are those intangibles. In fact, in a recent study, we saw
reasons why employees join firms and why they leave firms. It's nature of the work. Do they like their J .O .B.? Do they like the workplace environment, nature of the workplace? Do they like the relationship with the boss, nature of the relationship with those in charge and money? And in that order, nature of the work. Do you have documented roles and responsibilities for every member of the team? And do you effectively measure that two, three, four times a year? The once a year performance review is dead in the water.
The second nature of the workplace. How do you measure culture? How do you measure the vibe, the environment? All key ingredients, Tony says. Okay, let's talk about Jeff Price, managing director at Price and Associates Wealth Management Group. Jeff is a leader of one of the largest teams at Merrill. He says, when he first started out, I would always look for the unicorn when hiring, the individual he could plug and play into a specific role, portfolio manager, relationship manager, service advisor.
He says, well, over the years, it became more and more challenging, but he was having great success finding quality people and career developing them within their culture and their family. He says, I've come to realize that if I hire you and you're still in the same position two years later, he says, I've made a mistake. Say we hire an intern who then transitions into an administrative role, like a client advisor. If they end up getting stuck and not progressing out of the CA role, they become a
in our ability to continue to hire and develop others. Now that's an interesting perspective. He says the main, the three main equity owners of the firm are the rainmakers, but in order to develop, challenge and encourage the rest of the team, he says, we create a growth pool of money each quarter. There's a whole complex formula they use to determine the total pool, but it's based on growth like net new assets, for example, that the team brings
how each individual scores on their quarterly review then determines their percentage of the growth pool. Clever, really smart strategy in a warehouse environment. Everyone on our team, he says, is actively engaged in the community and we want them thinking of referral opportunities. So we reward them when they introduce a prospective client and rewards them again when and if that business closes.
He says, we also have financial incentives for cross -selling and other services such as banking and lending or IRA rollover opportunities. And at the end of the year, a discretionary bonus. He says, so there are multiple financial opportunities throughout the year. He says, we also regularly revise and restructure our profit sharing plan formula to address the changing dynamics of the industry. So essentially we're trying to give team members a taste of what it's like to be an advisor and reward them for pursuing a path to partnership.
These are great insights from Jeff Price. Clear, unambiguous career paths with measurable milestones combined with creative incentives designed to engage your team members and elicit optimal behaviors. Well, that's a potent recipe for sustained success and not only growing your business, but in cultivating the emerging leaders who will one day take the reins and continue your legacy. With each episode, we offer
five coaching questions from each specific episode. And they're designed to help you and your leadership team think creatively about applying some of the information we're sharing in these short episodes. So here are a few open -ended future oriented coaching questions based upon today's content. First, let's talk about visioning future structures. Given the emphasis on career paths and creative incentives, how do you and your team envision evolving
these strategies to further enhance team motivation and retention over the next five years. On leadership development, as you continue to build and refine your team structures, what key qualities will you look for in identifying and cultivating the next generation of leaders within your organization? On cultural integration, how do you plan to balance the benefits of a flexible work environment with the need for in -office collaboration to maintain and enhance
your company culture as work norms continue to evolve. On feedback and adaption, reflecting on the structured career paths and incentive systems you've currently implemented, well, what feedback mechanisms will you implement to ensure these strategies remain aligned with your business goals and employee expectations? And lastly, on innovative thinking. Looking forward, what innovative approaches are you considering
to further differentiate your firm from competitors regarding employee engagement, career development, and compensation. Thanks for tuning in. And that's a wrap. Until next time, this is Ray Scolfani. Keep building, growing, and striving for greatness. Together, we'll redefine what's possible in the world of wealth management. Be sure to check back for our latest episode and article. Have a great
you