The Evolving Advisory Sales Career

How the Prudential is keeping pace with a rapidly changing recruitment landscape

by Caroline Feeney

Winston Churchill famously said that to improve is to change.

In the financial planning industry, we have come to know the truth of this statement all too well. For those businesses that want to succeed, change has been perhaps the only constant. The market is evolving rapidly, both in terms of our client base and our financial professionals themselves. To stay relevant, we need to evolve with it.

As an industry, one of the major changes for which we need to prepare is the declining number and aging population of financial professionals. Throughout the financial services industry, a large proportion of advisors are quickly approaching retirement age. Indeed, it’s expected that over the next 10 to 20 years an estimated 45% of the current financial workforce will retire—and there may not be as many new advisors to take their place. Less than 5% of the existing 316,000 financial advisors in the country are under age 30, according to Cerulli Associates. The number of jobs available to financial advisors is expected to grow by more than 66,000 by 2020, according to the Bureau of Labor Statistics—that’s a 32% increase, which is more than double the average growth rate (14%) of all occupations.

So how do we prepare? The first step is to look at our recruiting strategies. It is incumbent upon us in the industry to groom a new generation of financial professionals to step into these roles, especially as the job of financial advisor itself expands to cover a host of solutions from life insurance and annuities to managed money and property and casualty insurance. Now more than ever, our industry needs to recruit and train advisors who can perform the ultimate balancing act: simplifying the process of explaining a customer’s investment product options, while still providing all the relevant details. This means we need to start telling a different story during the recruiting process and focus prospective individuals on how they can meet the increasingly complex needs of a client population, which itself is getting younger and hungrier for solid advice on managing their money.

The ability to help others…

As the client base shifts, we need to appeal to 20- and 30-somethings as prospective financial professionals by underscoring the important virtues of this career—not the least of which is the ability to help others, which is very meaningful to this generation. (Case in point: Despite difficult economic times, 8 out of 10 [81%] Millenials have donated money, goods and services to those in need, according to a recent study by Walden University and Harris Interactive.) Along with connecting to that passion, we need to seek out prospective advisors who may already have experience in the financial realm, even if they are not certified financial planners. Chartered life underwriters (CLU) and chartered financial consultants (ChFC) are already accustomed to establishing and maintaining recurring revenue streams and are more likely to be more familiar with the ins and outs of the profession, making them more productive from the start and less likely to want to leave the industry.

The second area in our industry’s evolution is technology. We find that those who embrace both the challenges and opportunities that come with technological innovation are better positioned for success. Financial professionals not only need to be knowledgeable about their products and the market in general, but they need to be conscientious about connecting with customers by their preferred channel whether that be phone, online applications, social media, or client-financial professional videoconferencing, all the while without overwhelming or intruding on them. At the same time, we need to balance the importance of face-to-face communication and how that adds to the value of a relationship. Adapting to this new “high-touch, high-tech” reality is going to offer the kind of best-in-class client experience that will win over the new generation of investors.

Technology as an added tool…

We’ve already witnessed that there’s tremendous potential for technology, not as a replacement for a voice on the other end of the phone, but as a complement to it. Case in point: our financial professionals last year began conducting all of their business on a virtual desktop through the Internet. This move has made it much more convenient to submit business electronically, making it easier for the client to conduct business and helping limit our dependence on paper.This typifies the culture shift we’re seeing as we become a more high-touch, high-tech organization.

Ultimately, we need to expand our thinking on how we onboard and train our new financial professionals by embracing both technological advances and the personal touch to create an environment where the right people can learn and grow and thrive. Of course, it remains true that many in our industry still wrestle with challenges such as large distribution forces, low productivity, poor retention, or high infrastructure costs. While there are ways to rectify these problems, such as reducing infrastructure costs and increasing the performance standards for financial professionals, we’ve shifted our own strategic efforts to increasing our recruitment while maintaining high hiring quality and great retention among our financial professionals.

Central to our success has been the launch of our Career Development Program which has proven to be a unique and very effective tool for drawing the right people into this career path. At its basic level, the program allows prospective financial professionals to become licensed at his or her own pace—even if he or she is still working a full-time job elsewhere. This approach gives our candidates a chance to try the career on for size. In this way, we are making sure this partnership is a good fit for our company and the individuals we bring on board as advisors. The numbers underscore our success: The four-year retention rate for our financial professionals is 22%, which well exceeds the industry average of 13%.

Better representatives of our diverse market…

The program has already paid off in more ways than just great retention. Aside from seeing an upgrade in the talent and leadership capabilities of our field management team, we’re seeing better representation of the diverse markets we serve, including women and people of color. And we’re offering better service to the mass affluent and mass middle markets.

The program has also provided an inside look as to what can happen when we take training and mentoring new financial professionals to the next level. Clearly, the classroom environment is not as conducive or available as it once was—so just as we look to reach our clients using the technology they want, we need to train the next generation in ways they are comfortable. One area we’ve successfully expanded into is video training – whether hearing a 5 minute clip from a top financial professional or seeing an established FP in action – these quick hits deliver more education and insight than a text book in simple, easy to digest ways.

Just as we’ve taken the time to develop prospective leaders among our financial professionals, these leaders have in turn embraced the same attitude and approach and are grooming their own team members. While we have a formal mentoring program in place, we’re seeing just as much success when our more seasoned financial professionals take it upon themselves to informally mentor their junior colleagues. For the more junior financial professionals just starting out, these mentor relationships have helped guide them in what can be a tricky job and bring them up to speed more quickly. For the mentors themselves, they are getting team members who can handle their jobs more effectively and bring on more clients, who in turn make them shine. And these relationships strengthen the ties both parties have to the job and to Prudential. It’s a win-win situation for everyone.

Some of the best examples of mentoring among our financial professionals come from the military veterans we have brought on board. Since my team began this effort about three years ago to recruit and hire those who have served in the military, we have brought on board about 168 veterans (78 in 2013 alone). Fifteen of those military veterans have entered the business in management positions. Despite the discouraging news about unemployment among the veteran community, we have found that these individuals are typically a great fit as financial professionals. They are often highly self-motivated and self-disciplined, and prepared to handle our highly structured training program. We’re really seeing our philosophy—“one team, win together, lose together”—working in everyone’s best interests.

It’s clear that we as an industry have a long road ahead if we’re going to take financial planning to the next level. We need to rethink practically everything about the way we recruit, screen, and train our Financial Professionals. We need to make the best use of emerging technology in all its forms, without losing sight of the personal touch. We need to encourage mentoring relationships because they are in the best interests of our business and our Financial Professionals themselves. In this way, we are assured that as the financial planning business changes, we will most certainly improve.

Life insurance and annuities are issued by The Prudential Insurance Company of America, Newark NJ and its affiliates. Securities products and services are offered through Pruco Securities, LLC. Investment advisory and financial planning services are offered through Prudential Financial Planning Services, a division of Pruco. Availability of other products varies by carrier and state.
Prudential is an equal opportunity employer. All qualified applicants will receive consideration for employment without regard to race, color, religion, gender, sexual orientation, national origin, genetics, disability, age, veteran status, or any other characteristic protected by law. The Prudential Insurance Company of America, Newark, NJ.
Prudential is an Employer that participates in E-Verify.
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