Reversing a Retention Trend

A leading wealth management company made key changes to attract more talent and improve retention.

Recent compensation cuts at a leading provider of annuities, mutual funds and other financial products led to a multiyear decline in the company’s total number of producers and a parallel decline in net assets. While the company was still attracting new producers, it was doing so at a diminished rate—at a pace that was far too slow to reverse the overall trend in production. The company needed to return to positive producer growth to improve its asset base, so it set a goal of attracting at least 50 new producers each year for three consecutive years.

ZS conducted an in-depth study of the company’s producer base, looking at territory, earnings and turnover within a three-year period. The team also conducted a survey of more than 600 producers and managers to better understand their levels of engagement, map out the onboarding and coaching process, and identify issue areas. ZS conducted a second survey of 150 competing financial advisors to develop a market-based perspective of the firm and identify key criteria for attracting producers. In the areas of incentives and territories, ZS instituted a new process for evaluating and assigning “books of business” to financial advisors, revised incentives to address cash flow and total earnings issues in the first year, and established milestone bonuses to guide advisors through rough patches in early tenure.

The ZS team introduced changes to address “at risk” times in a producer’s career, providing better clarity and certainty for all producers and raising pay levels for average-performing producers. As a result, the company forecasted a 10% improvement in retention and a 10% increase in recruitment rates.

Contact Jason Brown to discuss ways to deliver impact to your customers and accelerate profitable revenue growth.