All of us have our daily rituals, right? For many of us, it’s that first hot cup of coffee, prepared to our specifications by a friendly neighborhood barista. So, suppose that tomorrow morning, when you walk in and order your usual caffeinated beverage with your prescribed number of espresso shots and other customizations, the barista told you, “We don’t have that anymore. It’s gone. Unavailable.”
Sounds like the beginning of a bad day, doesn’t it? When something or someone you depend on suddenly isn’t available, it can bring about a lot of negative emotions, ranging from momentary annoyance to flat-out panic.
Now, replace your missing morning latté with the absence of a trusted, reliable, highly competent colleague or team member who has been lured away by the offer of a more lucrative position with another company. In all likelihood, this person is the company’s Rock of Gibraltar. And suddenly, the person the business can’t live without is… gone. What would you do?
The Pandemic and the Poaching Problem
Believe it or not, financial advisors face this problem all the time, and the reasons should come as no surprise. By now we know that the pandemic changed almost everything about the American workplace. One of its greatest effects was the nearly instant, worldwide shift toward acceptance of—indeed, outright reliance upon—remote work. Once that genie was out of the lamp, many jobs became borderless; you could work for anyone, anywhere, and you could do it from anywhere. In other words, people living in Pierre, South Dakota can now log in every morning and work for an employer in New York. And they can get paid New York rates, but still live in Pierre, if they want. It’s not hard to see why, in places like Wilmington, South Carolina, Sarasota, Florida, and Spokane, Washington, applications for remote work are far outpacing those in places like New York, San Francisco, and Seattle. According to LinkedIn, openings for remote work are attracting more attention than on-location jobs, even though those positions account for only 20% of the postings.
In other words, employers—including financial advisors—are now forced to compete with companies all over the country in order to retain their most prized employees. But that’s not the only problem.
We also have to worry about the health of our professional referral networks. After all, most financial advisors and wealth planners pride themselves on their ability to refer clients to dependable legal, tax, and other experts as needed. In fact, this is one of greatest value-adds many of us bring to the table. But what happens when we refer a client to our favorite CPA, and the client is told that the CPA can’t accept any new clients because the firm is short-handed? Similarly, we might recommend an estate-planning attorney, only to learn that the attorney is completely bogged down due to the loss of an ace paralegal who just resigned to take a job with another firm that was offering better pay or benefits.
In other words, the poaching problem doesn’t just affect your financial advisor—it affects your advisor’s referral network, too. For example, the accounting industry is currently being severely hampered by a shortage of qualified professionals, and many firms are struggling to handle growing demand for services with fewer people available to provide them. And it’s not just a problem with CPAs; attorneys also understand this all too well. A recent survey identified “staff poaching” among the foremost threats to law firm profitability.
We all know, deep down, that the most important resource in our practices isn’t assets under management; it’s our clients and the people who help us manage the assets. It’s also the professionals whom our clients depend on for authoritative tax and legal advice. That’s why it’s important for us all to help each other. By taking care of our key team members and helping our other professional colleagues do the same, we can keep doing the job our clients need most: providing them with access to state-of-the-art professional services and the individualized attention they have come to expect.
Stay Diversified, Stay YOUR Course!