Better Hiring Today

Sometimes it feels like companies make a concerted effort to drive their top-producing salespeople out of the organization and into the welcoming arms of the competition. If you read that line and chuckle, then you know exactly what I’m talking about.

After all the time and effort expended to locate, hire, and train top producers, why in the world do most compaines do things that make their top salespeople quit? In my opinion, companies don’t pay attention to the basic drivers/motivators for top producers. If your company has a hard time holding on to salespeople, it’s probably for one of the following reasons:

You’ve changed their compensation structure. And not for the better. The #1 cause of a disgruntled top producer is negative modifications to their compensation structure. With salepeople, the comp plan is a sacred covenant - everyone agrees that these are the rules. Top producers inevitable knock the ball out of the park, and management says, “Uh-oh. These guys are making too much money.” So they change the comp plan. The usual suspects are caps on commissions (ludicrous), reducing overall commission payouts (kills trust faster than anything), and taking away clients to give to other salespeople (all that hard work, stolen away). Please, don’t do this stuff.
They have an unhealthy relationship with their manager. This ususally happens when the top producer’s previous boss - who was awesome - gets promoted and is replace by a less-than-awesome boss who feels like they have to prove their worth by tinkering with everything that was working. I call this, “New Boss Syndrome.” It goes something like this: (1) New boss enters the picture, (2) new boss fails to take the time to build relationships with the top producers, (3) new boss says or does something to piss the top producers off, (4) new boss’ involvement actually starts to hinder the top producers’ ability to produce (read: mandatory attendance at excessive and pointless “sales meetings”), (5) top producer starts accepting headhunter phone calls, (6) they leave.
You’ve increased their risk. This risk may be caused by poor company financial performance, a merger or buyout, or an overall macro decline in the size of the market for the product or service that they’re selling. This one’s a bit more difficult to counter, and I mention it only because you need to pay twice the attention to top producers when a broad-based decline hits your industry. They begin to consider that move to Career X that they’ve always dreamed about.
These things are what headhunters are tuned to when calling your salespeople. If they perceive that one of the above is going on, they’ll zero in on your top producers like a missle.

The truth about top producers is that if their ego is sufficiently stroked, if they are fed with good marketing support, if their comp plan is solid, and if you get the heck out of their way, then they’ll be happily making your company money for as long as things stay rosy. If, however, you’d like to make you top salesperson quit and go work for a competitor, you’ve been taught how to do so.

I recently had the opportunity to speak with a number of bank executives on the topic of recruiting investment advisors, and thought I’d share with you, in the words of these bank execs, the specific traits and experiences that top-producing investment advisories look for when hiring representatives.

The list, in no particular order:

“The rep is a hunter, not a farmer. ” And not even a combination of the two, as many would suggest as a good fall-back plan if a pure hunter cannot be found.
“The rep isn’t afraid of the phone.” In fact, the rep loves the phone. They use it as the business tool that it is.
“The rep didn’t necessarily have financial experience when they joined.” But they had a track record of delivering above-quote sales numbers in a hunter role.
“The rep was perfectly comfortable with a low base / high commission structure.” Because they know what they’re capable of.
“It took months to lure them away from a great book of business.” Always the hardest part of luring them away - getting them to leave their book.
“The rep had a list of outstanding references a mile and a half long.” Important, because salepeople are great at selling themself in an interview, but, sometimes, that’s all they’re good at selling.
If you’re considering hiring an investment advisor for your bank, or if you currently have one or more investment advisors working for your bank who can’t seem to make it happen, then refer back to this list. Go with what’s worked for the best shops in the US.

If you’re a local or regional bank and run an in-house investment advisory practice, chances are that you’ve struggled with finding good talent. You’re not alone.

What are some things we know about recruiting investment reps?

- For starters, we know that there aren’t enough of them out there. Scratch that. There aren’t enough good ones out there. Sure, banks have been jettisoning Series 7-certified advisors for months now…but they’re keeping the top producers. This dynamic keeps the supply-side constraint as strong as ever.
- We know that only 5-10% of these reps are “lifers.” Performance and retention issues make this skill set a tough one to navigate.
- We know that care and feeding are critical, because these folks live on adrenaline and praise from their manager.
- Bottom line - Low supply + high wash rates + high maintenance = “let the Trust Department deal with it”

Where do top investment reps work? aka, “Where do you hunt for these people?”

- Banks, like yours
- Investment shops & wire houses
- Insurance companies
- For themselves as independents

Guess where you don’t hunt for reps? On job boards like Monster.com or Careerbuilder. And certainlynot on Craigslist.

What are these top reps doing every day? Well…

- They’re making great money.
- They’re continually building their book of business - their clients love them and refer them business; in fact, 80% of new business comes from referrals for these folks!
- They’re happy.

All of these facts combine to form a truth that’s as plain as the nose on your face: you’re going to have to pry them out of a very good situation. In the next post in this series, we’ll talk about what you look for when recruiting a top rep away from a competitor.