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Scale with Talent Series: 1 | Hiring

May 18, 2023
clock 4 MIN READ

When (and who) to hire.


As a business owner, there are two key challenges you are responsible to manage: your advisor firm’s growth and its capacity. Your team drives both, so it’s not surprising that questions around people comes up almost daily.

This is the first of our four-part blog series focused on scaling with talent. In this series we’ll explore best practices and tools to help you tackle common human capital challenges, including:

  • Hiring
  • Onboarding
  • Compensation
  • Leading and managing your people

The goal of this series and our “Scale with Talent” toolkit is to help you make the most of your investment in people. 

We can’t discuss scaling with talent without exploring best practices around hiring, which is a challenge for many advisory firm owners. It’s hard to find the time and energy to find and train qualified candidates when you’re already stretched thin. However, hiring doesn’t need to be so painful. Let's explore the two methods to help inform when and who you hire. 

But first, here's a couple important caveats to consider:

Expect hiring to take at least three to six months—with sourcing candidates being the hardest part. Unfortunately, there is no magic solution to sourcing candidates. In many ways it’s no different than sourcing new clients; it takes time and effort. Many advisors tell me that their personal network and LinkedIn are good sources for new candidates. If you’re hiring for an advisor, or other specialized, professional role, a recruiter specializing in financial professionals may be helpful.

Start sourcing candidates early, give yourself time, and be as clear as possible on what an ideal candidate looks like. In fact, it’s a good idea to have a job description ready to start prospecting for your next employee before you need it. Use SEI’s hiring checklist to ensure your process is set up for success.

Now, let's explore two methods to know when and who to hire. 

Method 1: Know when you are close to capacity by using people metrics

SEI’s Talent Planner includes people metrics that we think are important to know and review at least annually. Think of these metrics as key performance indicators (KPIs) that signal you are running up against capacity before you actually do.

The top performing firms did more with less, according to the InvestmentNews 2022 Advisor Benchmark Study (which SEI sponsors). Literally, they spent less (largely on people) while managing more revenue.

Are you at or over capacity? You can understand productivity by the following these two metrics versus target benchmarks:

  • Revenue per employee
  • Number of clients per employee

How do your metrics compare to the target ranges in our talent planner worksheet?

High revenue per employee or number of clients per employee signals that you may be close or at capacity. Don’t wait until you are drowning—start the process of hiring now.

Low revenue per employee or low number of clients per employee signals that you have capacity for growth, or that you may be overstaffed.

Your revenue per professional or number of clients per professional versus a benchmark, such as the ranges provided in worksheet, can provide insight into whether you’re understaffed with advisors and/or support staff.

Use these productivity and capacity metrics like your fuel gauge on your car–when the light comes on it’s time to refuel. Don’t wait until you’re running on fumes or out of gas to refuel in life and your business.

Method 2: The love-stomach-hate exercise

Here’s a qualitative approach to determine the priority of who and when to hire. Wilson Munoz, Managing Partner at Northweast Wealth Planners and current client of SEI1, shared that he determines when and who to hire by completing an exercise he calls: love, stomach, hate.

In 2018, Wilson was overwhelmed and at capacity but didn’t have a plan on when or who to hire. He gained clarity by listing everything he did then organizing them into three categories: love, stomach, and hate. He focused on hiring for the things that he hated first. He noticed the tasks he hated were largely administrative, making it clear that his first hire needed to be a client service associate. Before searching for candidates, he determined what the right structure was based on his needs and fair compensation according to industry benchmarks. What this person full-time or part-time? W-2 or 1099? Experienced or not?

He ended up hiring a full-time client service associate and the positive impact was almost immediate. He went back to his Love, Stomach, Hate exercise and focused on those tasks that he could stomach and determined that the next best hire was a paraplanner. Since making these two key hires, Wilson has more time and capacity, he’s grown more than he could have alone, and truly loves what he does again.      

The key takeaways:

  1. Be intentional about how you manage growth and capacity and build out your business and team 
  2. Understand and use key metrics to inform your business and hiring decisions
  3. Focus on adding capacity that makes the most of your expertise and energy

In our next blog, we’ll focus on onboarding to make the most of your people investment.



Important information
1 Client of SEI since 2017

Shauna Mace, CHPC

Head of Practice Management

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