This commentary was published on June 12th, 2020 in Family Wealth Report.
The pandemic has forced leaders to reflect and modify their talent acquisition process and to prioritize retention. The author of this article drills into how COVID-19 affects multi-family offices and registered investment advisors.
Kathy Freeman Godfrey is president of Kathy Freeman Company, a national executive search firm working with multi-family offices and wealth management firms.
The COVID-19 pandemic has not only upended the financial markets, but it has also changed how family offices and RIAs will need to think through recruiting and managing talent in the months to come.
The pandemic has forced leaders to reflect and modify their talent acquisition process and to prioritize retention. The coronavirus has also prompted a discussion about what a firm’s future might look like given the health threat to the baby boomers who are leading many of these businesses.
Here are five key talent and executive search trends family offices and RIAs need to consider:
Succession planning has taken on increased importance.
COVID-19 has been a wake-up call for chief executives of multi-family offices and RIAs. Long considered an administrative chore, succession planning has risen to the top of the agenda because the pandemic has highlighted a number of strategic issues.
These include whether the firm has a viable strategy for long-term sustainability and whether that path leads it to remain independent or to sell.
As a result, CEOs have started thinking seriously about hiring a chief operating officer or a second-in-command. COVID-19 has swamped many CEOs with operational issues they should not, and prefer not, to handle. Professionalizing the leadership team by ensuring that the firm has a multi-dimensional and cross-talented leadership bench will support these seasoned leaders whether they choose to build a legacy organically or prefer M&A forlong-term growth.
Sophisticated client advisors and wealth strategists are in limited supply.
Client-facing talent is always in short supply, but even more so now. The complexity of working with the ultra-high net worth requires a much higher degree of technical competence than ever before.
Today, the CFP designation isn’t enough. Private client advisors and wealth strategists often have numerous advanced degrees or designations such as JDs, CPAs, LLMs, or CFAs. Professionals with this kind of advanced or niche expertise and accomplishments are in high demand. Beyond the technical competence, there’s a need to layer in a strong degree of EQ (emotional intelligence) to navigate conversations about complex issues with families and their heirs.
The interview timeline has been extended.
What used to be a fairly quick process for candidate interviews has now been stretching into months.Firms are integrating Zoom or Microsoft Teams to conduct video interviews, which has served as a good middle step for getting acquainted with potential candidates. However, with the importance of each and every hire, staffing decisions for critical roles are being postponed until face-to-face meetings can resume.
Employee retention efforts have become increasingly important.
Firms may be unaware that the downside to having employees working remotely is that there is a greater ability and willingness to take calls from search firms or recruiters. Management teams need to prioritize the engagement of talent, especially when we are living in this disconnected time.
If a firm is experiencing difficulties because of the pandemic, whether it is a liquidity issue or their inability to offer a compelling vision for the future, employees will sense these weaknesses and be more open to conversations from other firms.
Working remotely will impact the cultural paradigm of every firm.
This new remote working environment due to the pandemic is a unique opportunity to address work-life balance and strengthen employee loyalty.
Many employees have realized that they can be quite productive without water cooler distractions or lengthy daily commutes. However, other employees have dealt with tremendous challenges whether trying to teach their school-aged children or take care of their elderly parents all while trying to productively address their work responsibilities.
When firms begin to ask their employees back to the office, it needs to be done with an attention to retaining the best of the company’s culture, while allowing flexibility of working between home and office. Figuring out the best way to maintain a culture of growth, trust, and client excellence without the consistent office camaraderie is going to be a challenge which firms will need to address.
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