In recent blog posts, we recommended that to hit this year’s aggressive revenue growth goals, wealth managers must maximize advisors’ capacity for sales and service, apply engagement competencies in all client interactions, and leverage financial planning to expand share-of-wallet.
For each of these three steps, however, having effective team structures to sell and deliver advice to clients is paramount. Of course, there is no one “right” team structure that wealth managers must implement. Depending on the organization’s size, footprint, and culture, various organizational structures can be effective.
Through our conversations with members, however, we have uncovered three key ingredients necessary for the success of teams delivering advice: 1) client centricity, 2) coordination, and 3) compensation.
Harper Bank, a North American wealth manager, for example, has successfully incorporated client centricity, coordination, and compensation into its advice team structures – but that wasn’t always the case. Previously, Harper Bank compensated its product specialists exclusively on sales of their own products. Specialists worked in their own silos without access to all of the client’s information and were therefore not positioned or incented to deliver holistic advice.
To restructure its advice delivery teams, Harper Bank made it compulsory for all product specialists to build a team around the client. Now, as soon as a new client talks to a product specialist, the client’s basic profile is automatically sent to a senior manager in the bank, who assigns a relationship manager to the client based on the relationship manager’s skills and predicted personal compatibility with the client. The relationship manager then coordinates specialists across the firm and builds an advice team suited to that client’s present and future needs.
To further ensure the success of its advice delivery teams, Harper Bank’s incentive plan encourages team members to play lead as well as supporting roles in teams, thereby satisfying the third key ingredient, compensation.
Building teams that meet all three criteria of client centricity, coordination, and compensation has certainly paid off for the bank. Since launching team-based advice delivery, Harper Bank’s client pipeline has increased by 25%, and its cross-sell ratio has increased from 1.5 to 2.5.
