Broker-dealer practice management programs popular, but impact is hard to measure
Firms see gains in recruitment, retention and productivity, Cerulli finds.
Practice management programs enhance broker-dealers’ efforts to attract advisers, retain them and boost their productivity, but their bottom-line impact is difficult to measure, according to research from Cerulli Associates.
“Heads of practice management indicate that the most effective adviser support is one-on-one consulting, but they recognize that this is an expensive solution, difficult to scale, and it is hard to source qualified talent,” wrote researcher Kenton Shirk. “And because the degree of impact is nebulous and difficult for firms to measure, it is challenging to evaluate the impact of investments in these programs.”
The research found that the top three practice management challenges at broker-dealers are motivating advisers to fully follow through on engagements (cited by 88% of firms), managing the volume of adviser demand (85%) and scaling consulting services in a cost-effective manner (81%).
Broker-dealers with practice management programs report the average headcount of staff in the area is 19. Senior-level professionals including consultants, coaches, specialists and program managers account for 56% of the total, while 28% of staff are junior-level professionals, followed by administrative staff (16%) and other roles (1%).
Firms studied by Cerulli averaged $22 billion in assets under management for each practice management professional employed.
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