Consider A Job Candidate’s Technology Skills

By Cyril Tuohy

InsuranceNewsNet

Veteran financial advisors seeking to hire young successors would be advised to give some thought to the candidate’s ability to handle new technology, a top recruiter of financial advisors said.

It’s not a matter of whether candidates know anything about one technology compared to another. It’s about which new, young advisor fits best for the technology already in the office, or what kind of technology model the new advisor intends to adopt once in charge.

Thousands of advisory firms will change hands over the next decade as baby boomers cash out and leave their life’s work to younger peers. Many of those advisory companies were founded by executives who no longer represent the cutting edge – or often any edge – when it comes to using technology to grow the business.

Caleb Brown, a partner with New Planner Recruiting in Athens, Georgia, said that in order to move founding members along with the sale of the business, it’s best to paint the transition in terms of maximizing profitability by bringing in a younger labor force.

It’s a dilemma that many advisory firms are going through now, said Brown, himself a member of Generation Y.

“The bigger you get, the harder it is to keep profit margins and if you’re not using technology, it’s impossible,” he told InsuranceNewsNet.

The way to get to founders and owners who refuse to implement new technology is to wean them off cruise control by presenting long-time owners with sales and growth metrics of other advisors with whom the veterans compete, Brown said.

A new advisor who has only two years in the market but who generates half the volume that a veteran of the trade has taken 40 years or more to build says something about the way the advisory model is run, Brown said.

“If you position it correctly, that might light a fire under them,” Brown said.

In a previous era, owners looking to hire an eventual successor would likely have had a choice.

Owners would have been able to choose between a young advisor exceedingly organized in the ways of metal filing cabinets, multiple-line telephones and fax machines for which advisor business cards still list numbers.

Alternatively, owners would have decided to hire advisors familiar with Apple’s VisiCalc spreadsheet program, or Microsoft’s disk operating system, the precursor to Windows, to run the ubiquitous Excel office application.

Either the founder stuck with a successor schooled in the ways of pen and paper, or the chief executive officer decided to get on the ground floor of the computer revolution and hire a college graduate to take the advisory into a new technological direction once the founder had called it quits for good.

That hiring decision would have set the course for the advisory for the next 20 years. There were plenty of candidates on either side of the technology divide to choose from, whichever way the owner decided to go.

Fast forward 30 years and there is no such divide. Every young candidate who walks in the door looking to work as an advisor will be familiar with standard desktop applications, mobile platforms and social media.

Brown suggests advisors in the market for younger talent can improve the chances of finding a good fit by screening for computer literacy. Don’t bother hiring anyone who doesn’t know his or her way around software, he said.

Familiarity with complex financial and retirement planning software is in particularly high demand, he said. “That's where the bottleneck is. We can't get people out fast enough to get the plans done quick enough.”

If 50 million Generation Xers are familiar with mobile computing solutions, and 80 million Generation Yers are technology dependent, advisors had better have a plan to get tablets or good smartphones into the hands of advisors.

Advisories without a technology plan that appeals to young advisors are going to lose both their younger agents and the premium dollars those agents would have brought in by prospecting for clients from the Generation Y pool.

Allowing agents access to the network from the road with mobile devices is a “no brainer,” Brown said. Systems that don’t give advisors the ability to update contacts and access documents remotely means the firm is going to go out of business.

Brown said that every time he walks into an advisory firm and lays eyes on filing cabinets or similar relics of the 1980s, the advisory can expect to lose another few points in value in the eyes of the marketplace – and that’s not going to help owners when the time comes to sell.

Cyril Tuohy is a writer based in Pennsylvania. He has covered the financial services industry for more than 15 years. Cyril may be reached at [email protected].

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Cyril Tuohy is a writer based in Pennsylvania. He has covered the financial services industry for more than 15 years. He can be reached at [email protected].