Business succession planning - recruitment, retention and remuneration strategies

Financial Advisory

21 April 2016

Financial Advisory

Facilitated and written by: Roderic Rennison – Rennison Consulting Expert: Sarah Thwaites – BP&E Global Ltd


A key success factor for financial intermediaries is to develop and then maintain successful recruitment, retention and remuneration policies. It has long been accepted that there is a shortage of “quality” advisers as well as certain other staff such as paraplanners so this area deserves the time it takes to achieve the required results.

Firms therefore need to have processes in place to ensure that they are suitably equipped to recruit advisers and other staff that meet their business needs and plans. Otherwise, in some instances, they will be unable to fully realise their development and growth plans.


Recruitment will reflect a firm’s business model and culture and the success achieved will affect to the objectives that the firm has set itself. Firms that recruit and retain happy and productive advisers and other staff are usually characterised by having the following attributes:

  • A clear and well-articulated  strategy that is communicated effectively within the organisation
  • An culture and environment where learning and development is encouraged
  • Remuneration which is aligned to good client outcomes – treating client fairly and a strong emphasis on client service and retention.

The challenge for firms is then to identify and recruit the “right” advisers, paraplanners and other staff. Traditionally, many firms have sought out experienced advisers from other firms and often via recruitment agencies. However, this is usually an expensive process and so firms now increasingly are using other alternatives due to the scarcity of certain categories of staff,  in particular of advisers. These include:

Social Media – Some firms now use Facebook and Twitter to attract new people to their organisation. Particular care is required given the audience that it can reach.

Referrals – Firms often encourage existing staff to refer friends and acquaintances and make a payment for people who join (which is usually much cheaper than using traditional recruitment agencies and often yields better results).

Advertising – this is still used to good effect by some firms with a move by some to online advertising rather than say local newspapers.

Grow your own versus hiring experienced staff

Because of the challenge of recruiting the right kind and calibre of staff, an increasing number of firms have moved to what is widely termed an “academy” model. This involves recruiting people from either school or university and offering them a structured training programme that leads through to becoming an adviser perhaps via paraplanning status.

There have been mixed results; some firms have found that having spent time and money training say graduates, they then go elsewhere to other firms who reap the benefit. Nevertheless, the payback to the firm if the training is structured appropriately can and often is considerable.

A variation is to recruit “interns“ for say three to six months and then to take on the best ones on permanent contracts. The advantage of this approach is that it provides both the firm and the interns with an opportunity to get to know one another before committing.

The amount of work involved in developing and then managing such programmes should not be under-estimated and firms need to make available the resource if they want to get lasting results. A programme that ends in failure and recrimination can cause significant setbacks.


The investment in time let alone cost in any new employee is considerable, and so identifying ways of increasing the likelihood of retaining them is worth giving attention to. There is no one “magic bullet” but there are certain (perhaps obvious) things to do that can and will make a positive difference. They include:

  • Taking care with the recruitment process – for example, letting others in your firm interview them and showing them the environment in which they will be working
  • Putting in place a formal induction/training programme so that new employees receive regular ongoing guidance and support in their first few months of employment
  •  Putting in place a “buddy” system so that new employees work alongside experienced employees who can provide a source of information and support
  • Setting goals and objectives and then carrying out regular appraisals
  • Providing an environment where employees are encouraged to learn skills that benefit the business
  • Having mechanisms in place that enable employees who have concerns to voice them and have them addressed at an early stage – perhaps via mentors who can be more senior and experienced employees

When used in combination, these actions will help improve morale and motivation which should in turn over time increase productivity and retention.


Remuneration is also a key “ingredient” in ensuring that employees are happy and secure in their roles and choose to remain with a firm.

Incentives should be aligned to outcomes and in the case of advisers they should be aligned to quality, not just quantity, and service should also be a key driver.

Money is an obvious motivator, but some non-monetary benefits will appeal to different categories of employee depending on their circumstances and needs and are not in many instances difficult to implement. For example, some employees will value childcare vouchers and others will value private medical insurance so using a budget to provide relevant benefits rather than the same ones for all staff is likely to result in better outcomes.

Finally, there are often simple things that cost relatively little but often go a long way to creating a happy environment that help motivation and retention. Two common examples are providing free fruit and creating an area for taking breaks away from the working environment.

Maintaining a competitive edge

There is no secret here – it’s a case of not accepting the status quo and being open to new ideas.

One obvious action that pays dividends is to ask your employees what motivates them and what preferences they have. Surprisingly few firms do this yet the answers are often relatively easy and inexpensive to facilitate.

So, in summary it’s like a number of other challenges that your business faces; the more time you put in to analysis, planning and implementation, and then review, the more likely it is that the desired results will be achieved.