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Beverly Flaxington is a practice management consultant. She answers questions from advisors facing human resource issues. To submit yours, email us here.
Dear Bev,
I am part of a top-performing team that is breaking at the seams due to compensation differences. Personally, I don’t think comp is that hard: You get paid for what you do — no more, no less. The senior leaders of our team oppose this. They don’t believe anyone should get paid proportionally for things they had the bigger role in, such as bringing in clients and managing relationships. It’s a team effort — that’s the whole point. The team should participate if the team is working on something. It’s not a handout; rather, it’s fair compensation for work done.
Our leaders hold all the decisions. They can do whatever they want and expect us to be fine with it. A team breaking apart over money isn’t good for anyone. Is there a way to show our leaders how detrimental this is to team culture and team involvement?
Anonymous
Dear Frustrated Team Member,
If there is one topic I’m seeing come up with the teams I am working with lately, it is compensation. It’s tough to be in a business where there is a lot of money available and everyone has a different viewpoint of how that money should be allocated. The combination of succession planning — where the lead advisor wants to have a successful and well-funded retirement and the successors want to get paid for taking over — along with the riches of the market over the last few years are all adding up to significant unrest within many teams.
I’m doing a session at the Barron’s Advisor 100 Summit in September on this topic, because we hear about it constantly from many teams. The inherent problem is that, if you view it from the senior leaders’ seats, they have a point. They did grow the original business, they typically are the rainmakers, and they do have the decades-long client relationships.
If you view it from the team members’ seat, they have a point. They are the contributing factors in keeping the clients; they will be there to manage client retention once the senior partners leave; and they work hard to deepen and expand relationships. In fairness, neither “side” is wrong. They both have a realistic point of view. We know, however, that a dollar can only be split into 100 pennies. It isn’t like you can stretch it and expand it — as many households living paycheck to paycheck know all too well!
So, to answer your question, yes, there are ways to get your leaders to understand impact. You could:
- Have an open team discussion about each person’s viewpoint and see if there is some negotiated ground to reach.
- Establish team culture and agree on whether the leaders want a collaborative team-oriented environment, or one that operates more independently with a focus on “my client” or “my money.” Having a common goal is imperative for high-performing teams.
- Understand that the leaders ultimately hold the final decision, and sometimes the team has to decide what they can live with and what they can’t.
There are no easy answers to this issue. It’s worth trying to get the leaders to see your point of view, but remember, as I point out in #3, they are the ones in charge and making the final decisions.
Dear Bev,
I know the focus is often on growth, and I understand our RIA needs to grow in order to be a thriving and ongoing entity. I think sometimes the leaders of our firm don’t understand the significant load we carry as advisors in working with clients on a regular basis.
This week alone I have put out 10 different fires for individual clients. The market was nuts, and responding to worried clients can be challenging and exhausting. Sometimes the head of the advisors here has a “what have you done for me lately” attitude. It’s grating and demoralizing. Client retention and satisfaction are also worthwhile goals.
K.E.
Dear K.E.,
This is the eternal struggle to find a balance between the voices of the people running an organization — be it team or RIA — and the ones keeping the business going. You must focus on growth, continue to bring in new clients, and expand existing ones. Every business needs to do this to continue to survive.
You also must ensure existing clients are cared for, satisfied, and want to stay with the firm. These are not opposing objectives. However, there are simply some days that do not have enough hours to accommodate equal focus on both. This is especially true when there are still other issues of immediate concern.
If you set goals and everyone understands expectations, you can allocate the necessary time to meet those goals. I find that many advisors want to defer the focus on growth, because it is more comfortable (and more pressing) to deal with client issues. I respect this, and it makes sense to address the tasks right in front of you. However, if you have time allocated, you can make headway on growth-related activities as well.
I like to point out to my advisor clients that when a client emergency happens — and those are unplanned in almost every case — you somehow find the time to deal with it. You aren’t given a choice — it has to be addressed. Where does that found time come from? How can you make time you didn’t really have to give in the first place? You just have to do it, so you do.
If you prioritize growth activities, and set the objective to deal with them, it’s a similar dynamic. You will find the time for anything you believe you “have to” do. Make this a must-have, not a nice-to-have and you might find yourself allocating your days and weeks a little differently.
Beverly Flaxington co-founded The Collaborative, a consulting firm devoted to business building for the financial services industry, in 1995. The firm also founded and manages the Advisors Sales Academy. The firm has won the Wealthbriefing WealthTech award for Best Training Solution for 2022, 2023, 2024, 2025 and 2026. Beverly is currently an adjunct professor at Suffolk University teaching Executive MBA students Leadership and Managing Teams. She is a Certified Professional Behavioral Analyst (CPBA) and Certified Professional Values Analyst (CPVA).
She has spent over 25 years in the investment industry and has been featured in Selling Power Magazine and quoted in hundreds of media outlets, including The Wall Street Journal, MSNBC.com, Investment News and Solutions Magazine for the FPA. She speaks frequently at investment industry conferences and is a speaker for the CFA Institute.
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Advisor Perspectives welcomes guest contributions. The views presented here do not necessarily represent those of Advisor Perspectives.
