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Employee Onboarding for Financial Advisors Beyond “Sink or Swim”

By ClientWise | January 14, 2014


By its history and character, the financial advisory industry is imbued with a Darwinian survival-of-the-fittest attitude. One question though, especially if you are a leader or principal of a financial advisory team. Does this “sink or swim” mindset also apply to your new employees and team members? If so, you may be placing your…employee morale, productivity, and company revenue…at great risk. 

 

Check this out: 

  • Not so long ago, it was the norm to stay at a job for many years, or even a lifetime. Not true today. According to a 2012 Bureau of Labor Statistics study, the average employee stays at a job for 4.6 years, and has 11 different jobs over the course of his/her career.
  • There’s a wide range of cost estimates for losing an employee, anywhere from 16%, and up to 200+%. Typically, the more senior the employee, the higher the percentage.
  • 22% of staff turnover happens within the first 45 days, and 50% of hourly workers leave within the first four months.

 

Is your interest piqued yet? Wait! There’s more…

Calculating the real (and intangible) cost of losing a valued employee? What’s the real cost of employee turnover? In many cases, the costs are intangible and hard to track. Some examples:

 

  • The cost of hiring a new employee including the advertising, interviewing, screening, and hiring.
  • Cost of on-boarding a new person including training and management time.
  • Lost productivity... it may take a new employee 1-2 years to reach the productivity of an existing person.
  • Lost engagement... the remaining employees who see high turnover tend to disengage and lose productivity.
  • Client service and errors, for example new employees take longer and are often less adept at solving problems.
  • Training cost. For example, over 2-3 years a business likely invests 10-20% of an employee's salary or more in training
  • Cultural impact... Whenever someone leaves others take time to ask "why?"

The bottom-line is that happy employees (and team members) help a company (and team) thrive. Unhappy employees can carry costs that go well beyond simple dollars and cents, which by itself is considerable.

 

What’s the answer?

 

One effective tool for financial advisory practices to minimize employee turnover is an employee on-boarding program. A successful employee on-boarding program ensures that new hires feel welcome and prepared in their new positions, in turn giving them the confidence and resources to make an impact within your organization. In fact, new employees who go through a structured on-boarding program are 58% more likely to be with the organization after three years.

 

For more detail on how to create an effective employee onboarding process, stay tuned. We will address this in greater specifics in an upcoming blog post.

 

 

For a complimentary ClientWise Learning Tool on how to find new clients, please download below:

 

How Successful Financial Advisors Find New Clients

Topics: Team Development

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