Darren Steinhardt and Kris Martin

Advice groups looking to shore up their long-term adviser stocks are leaning into the professional year set-up and embedding themselves in the university environment, with Brisbane adviser Kris Martin telling Professional Planner his firm has gone “fairly aggressively” into the early recruitment space.

Speaking on the Principals in Practice podcast, sponsored by BlackRock, Martin explained how his KDM Financial advice group used the advent of the professional year requirement as a catalyst to bolster their recruitment program.

“We did go fairly aggressively into the space, as soon as we could essentially,” Martin said, noting that KDM has already had two advisers complete the professional year, while two are in progress and another two started in July.

“One of the biggest… concerns that we have for the profession going forward is bringing that talent through and making sure we have that next generation of advisers. And it’s quite a small a small pool of advisers at the moment… so we certainly would like to aggressively look into those spaces to get those young advisers on board.”

Martin detailed last year how KDM was addressing the industry’s talent deficit directly by setting up a line of communication with schools and universities as part of a broader ‘adoption’ program to bring young prospects into the industry.

By visiting schools and universities and talking to students about advice, Martin and partner Luke Marshal brought 15 graduates and interns through their North Brisbane firm, with over half of those being subsequently hired.

Martin detailed the ‘adoption’ process in the podcast, explaining that the firm takes on four to six interns twice a year. “We put our hand up to take on as many interns as we can,” he said.

“We generally hire, every six months, at least two of those four to six interns,” the adviser continued. “We also do a few additional things such as sponsoring a couple of students every year and offering a few prizes for the top students. And so it always keeps us, I suppose, front of mind and is proving to be a good resource for us.”

According to Darren Steinhardt, founder and managing director of licensee InFocus, the professional year program is something to be embraced by principals as an extension of their traditional recruitment set-ups.

“For us the professional development program is just really another level on top of what we have traditionally done over the years, [but] much more structured, much more formal,” he said on the podcast. “And I think much better.”

Steinhardt acknowledged the role licensees have in supporting their associated advice groups construct and run their professional year programs. As licensees try to impress advisers through their value proposition, he notes, support in areas like training and development is crucial.

“So there’s a few things we’ve done within the network to help defray the costs of actually helping advisers get people in that program, because it’s running your own advice practice [and] there are the ancillary costs that you’ll have to cover… hidden costs… so we do what we can to help everybody through that.”

While some advisers have expressed concern that nothing binds a professional year candidate to the company that trained them, Steinhardt said the onus remains on the firm to give staff a reason to stick around.

“In my view, if somebody’s business isn’t structured the way that it needs to be to both attract and retain talent, the issue isn’t the professional year, the issue is the business internally,” he said.

“Do you have a remuneration program that actually is appropriate for the team that you have? Do you have a career path that will allow these people to progress through to partnership if that’s what they want to do? Do you have good structures in place for people who do need to take time out of the workforce from time to time?

“It is not a quick term solution and there is an investment, and you will not get a payback on that investment for five, six or seven years,” Steinhardt continued. “But you will get a payback.”

One comment on “‘Aggressive’ PY candidate recruitment key to adviser stocks”
  1. Avatar
    Jeremy Wright

    Interesting point that Darren makes, is it will take up to seven years to get a pay back on the time and cost of bringing on and training up a new Adviser.

    In previous years, it was the Big end of town Financial Services and Life Insurance Companies who recruited and trained up new people so they would sell their products based on loyalty and incentives that no longer exist.

    What took many decades to build up Adviser numbers, has taken a few short years to decimate the Industry.

    The obvious solution to the perceived and real issues, was to first put them under the microscope and come up with a regime that excised the bad apples and encouraged the farmer to keep producing.

    What we ended up with was a solution that napalmed the entire Industry with a vision of building a Utopian producer that at the time and even now, does not exist.

    It is common sense that you cannot rely on Legislation and Regulation that no-one understands and therefore no one except Lawyers will read, as being the salvation of all things.

    So getting back to the miniscule pool of young, inexperienced people who do not have the necessary life and Industry experience to solve the problems of insufficient Adviser numbers, then adding in real world employment problems, where people use Employers as a paid training process to use as leverage to get a higher paid job elsewhere, or leverage to squeeze even harder for more money, highlights what Darren states about 5 to 7 years to get a return, assuming they stay that long.

    Most Advisers did not come direct from University into the Industry and until the Government and interested parties recognise that this single solution, is actually not a solution at all and that we need a pathway that encourages people from all walks of life and “dare I say it,” even allow highly experienced Advisers who felt they were pushed out the door with all the chaos that ensued from the numerous Industry investigations and challenges that made being an Adviser feel like being in a torture chamber, to want to come back and help Australians with their financial futures.

    TODAY, what we have is a choice of what cane to be beaten with and reminds me of the good old days at high school where that was our choice.

    12,000 Advisers leaving the Industry, where most of them were hard working, honest and experienced people who did so much good for this country, is going to go down in history as being one of the most stupid and avoidable strategies, brought on by vested interest groups, Lawyers, inept Government ministers and Regulators who have never been involved in the REAL world, though were instrumental in causing untold damage that this country has ever been subjected to.

    When you allow the lunatics to run the asylum, it NEVER ends well.

    Listening to sage advice that answers the questions, then putting in place strategies to fix issues that will not cause more damage than good, is today and has always been, the right way to do things.

    We are NOT there yet.

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