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The Evolving Role of Branch Managers

While financial advisors are the face of the industry, the people clients interact with most, branch managers are no less important. They have long played a vital role in the careers of their advisors, acting as mentors and coaches. But the demands on branch managers have multiplied in recent years. The pressure to recruit new talent is more intense. Corporate cultures have changed in the wake of a wave of mergers, in some cases multiplying the number of advisors for which branch managers are responsible. And the ranks of branch managers are graying, causing firms to rethink where the next generation of branch management will come from.

“At the end of the day, being a manager, you feel alone on an island,” says Thomas Hirsch, a Raymond James & Associates branch manager based in Louisville, Ky. Hirsch is one of 10 winners of the 2014 Branch Manager Awards given by On Wall Street in partnership with New York Life/MainStay Investments.

Firms like Wells Fargo, Merrill Lynch and Raymond James have recognized that pressures have mounted and are making moves to provide relief. All three are offering branch managers personal coaching and mentoring, just as branch managers do for advisors.

“There is no question that the role of the branch manager has gotten harder,” acknowledges Chip Walker, managing director of field leadership effectiveness at Wells Fargo Advisors.

Wells has 623 branch managers and is in the process of developing performance coaches to help its branch managers. So far, a dozen have participated in a pilot program that started about a year ago.

Walker compares it with best practices in sports. He points out how even star athletes have personal coaches providing tips on how to improve their game performance.

“What we are doing is creating a coaching infrastructure,” says Walker, who previously helped advisors from other firms transition to Wells Fargo. “Whether it is a business coach or recruiting coach, it results in a collaborative structure. It helps managers drive key initiatives.”

The San Francisco-based firm is also adding a tenth region in order to move resources, like compliance and risk management offices, closer to the branch management level. This will let them spend more time with their FAs, Walker claims.

“Instead of always feeling like you’ve got to call the headquarters, you can instead just call your local regional risk manager,” he says. “Our goal is to put more resources in finance, growth, compliance. What we want managers to be able to do is to tap resources at a local level.”

Among several programs, Raymond James offers its managers a two-and-a-half day program that focuses on coaching and practice management techniques. In essence, it’s coaching for coaches. About 30 managers attend the annual program.

Eileen Carpenter, performance consultant at Raymond James, which has about 250 branch managers, says having them physically attend rather than simply complete the training online makes an enormous difference.

“They are exposed to best practices,” she says. “We can send emails, we can put it on our Internet, but until they can come in and sit still for a minute, we don’t

really reach them. This gets to them and really benefits them.”

Branch managers say the program has the added benefit of helping them build a support network of other branch managers to share common experiences, problems and solutions.

“For me, one of the most valuable things at Raymond James is that network,” explains Hirsch, the Louisville branch manager. “It allows me to pick up the phone and communicate with them, and say ‘God, I’m dealing with this, how did you handle it?’”


Merrill Lynch has had some type of branch manager training program in place since 1946. Its Leaders in Development program (LiD) was launched in 2012 to reflect that today’s managers act as “operators-in-chief,” explains Cheri Lytle, head of human resources at Merrill Lynch Wealth Management.

LiD includes traditional financial education but also more leadership and communication training. “Technical expertise is great, but it’s not the only thing,” says Lytle. “We’re looking for potential leaders with versatility. People who can inspire large groups of advisors, who can set a strategic vision and get their teams to meet those goals.”

The program includes classroom, virtual and on-the-job training. Candidates get executive exposure by participating in business reviews, meetings with complex directors and networking events. Lytle says Merrill also emphasizes risk management, putting its trainees through scenarios to learn how to mitigate risk, a reflection of the greater regulatory scrutiny firms and employees are under. Mentors are also assigned to each trainee, to guide them through each stage of the program.

LiD takes approximately two years to complete, depending on the trainee. About 30 managers have come out of the program. In addition, Merrill now takes in candidates from its advisor ranks and elsewhere at the firm, giving the company a larger pool from which to draw.

“We have to cast a wider net to find the talent,” Lytle says.

Some industry insiders are wary, however, of bringing in non-advisors, says Mark Fellows, a former wirehouse branch manager who is currently regional manager for the Mountain West Region of Benjamin F. Edwards. It used to be standard procedure at older firms to promote the biggest producing advisor to branch manager, Fellows says, a policy that in his estimation didn’t always result in good managers. But he’s equally wary of looking to tap non-advisors for branch management roles.

“I think it would be pretty hard to be a hockey coach if you have never played the game,” he says. “I think having experience as an advisor helps a lot.”

Margaret Black-Scott, a former managing director at Morgan Stanley and current president and CEO of Beverly Hills Wealth Management, agrees. “It’s very helpful if someone is leading the pack who has done what you are doing.”


Moving in the opposite direction from Merrill is Raymond James, which has historically recruited new managers from outside the firm. The regional wealth manager plans to launch its first training program to identify talent within the firm’s advisor ranks. The program is due to begin in fiscal year 2015, and will ideally graduate 10 to 15 new branch managers over a two-year period, explains Carpenter.

“Where do you recruit from? We recognize that we need to grow organically,” acknowledges Carpenter.

She says the Tampa Bay-based firm looks for managers who are eager learners and team players, and who demonstrate a clear willingness to help those around them. “If a branch manager knows what tech is available and is up on the latest practice management resources, he or she adds value,” Carpenter allows. “Those are the kind of managers who attract advisors, not repel them.”


Meanwhile, branch managers in the field have their complaints. Some say privately that they feel out of place, particularly at firms that adopt a new corporate culture following a merger with another company.

“During the change from A.G. Edwards to Wachovia to Wells, there was a significant pressure change,” says Benjamin F. Edwards’ Fellows. “You needed to manage more people. There were more management meetings. There was more focus on what the firm wanted.”

Having to oversee that many more advisors takes away from the manager’s time to actually work with his staff and develop his branch, observes Mike Maurer, CEO and founding partner of Steward Partners Global Advisory and a former Morgan Stanley complex manager.

“A great branch manager is a relationship builder,” Maurer says. “If they have to cover 70 advisors instead of 40, then that makes a difference.”

While some might consider moving to a regional firm, experts say new branch manager positions are few and far between.

“With all the mergers, there are less branch manager roles,” explains Andy Tasnady, managing partner and founder of Tasnady & Associates. “There is not a big market to become a branch manager in another company. There is great demand for hiring financial advisors, but not so much for branch managers.”


Experts also say recruitment, a critical responsibility of the branch manager, has become more difficult because of the plethora of choices advisors now have about where to go.

The competition for top talent is heating up, as wirehouses and regionals offer ever-more lucrative recruiting packages. Plus, advisors are increasingly tempted to go independent. The proliferation of such options, says recruiter Howard Diamond, complicates the recruiting task of the branch manager.

“Ten years ago, if I was a Merrill Lynch advisor, I would have looked at the other wirehouses,” says Diamond,  managing director and COO of Diamond Consultants. That would be all I would be looking at. Today, I’m looking at the other wirehouses, the regional firms and the RIA space. Firms like HighTower, Focus Financial and Lebenthal are all additional competition.”

These demands can take away from time otherwise spent coaching advisors. And the pressures have ratcheted up as firms scaled back their advisor training programs in recent years, creating a greater imperative to poach veteran talent from competitors.

“The companies used to have these big training programs for recruits right out of college, so the recruiting volumes were lower,” explains Tasnady. “But today the firms have reduced their training programs, and the deals have gotten very expensive and much longer term. Today you might have a seven-year deal.”


With responsibilities piling on, it’s not surprising that going independent has become as attractive to some managers as it is to the many advisors who have already jumped ship.

Steward Partners’ Maurer argues that more managers will break away to form their own firms and practices because they can join existing networks and partnerships that provide them with corporate and back-office support they are accustomed to having access to at the wirehouses. “Its going to get much more crowded,” he says. “They never had this toolbox, but now they do.”

But making the leap to independence isn’t easy. A producing manager has a book of business to bring to a new independent firm. A non-producing branch manager has, in a sense, given up the safety net that a book represents. In a tough marketplace, his or her most valuable asset as an independent is a Rolodex of advisor names and numbers.

Even with a strong network, finding a position can be challenging. “The branch managers who gave up their book of business to become a branch

manager, they say it was the most foolish move they ever made,” says Diamond. “They gave up their insurance policy.”

Sanctuary Wealth Services’ Spears expects some non-producing branch managers will have second thoughts once they see the real risks and rewards of independence.

“Brand name firms have less personal risk,” he says. “You’re going to an established firm. An independent firm is in essence a startup.”

While the pressures have intensified in recent years, branch managers have responded by going the distance for their advisors. And in an industry where those advisors and the assets they manage are so important to the bottom line, it has become clear that managers have long been key players in keeping the engines of wealth management finely tuned. For their part, firms are changing course to ensure that this generation of branch management, and the next, will get the same support they give to their advisors.

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