Integrated Advisory Teams

Art by Giulia Sagramola

New research from the Investments & Wealth Institute, published in collaboration with Janus Henderson Investors, suggests that advisers like to use teamwork terminology—but they have less success at forming truly integrated advisory teams. The two entities presented their findings in an analysis aptly titled “High-Performing Advisor Teams,” where they identified numerous advantages of working in a team context. Importantly, the research sought to “distinguish factors of the most productive teams.”

Study participants included advisers who operate in branch networks—i.e., wirehouse and national/regional broker/dealers (B/Ds)—and independent channels, including independent broker/dealers, registered investment advisers (RIAs) and hybrid RIAs. As the researchers lay out, teams were ranked by assets under management (AUM) per producing adviser, AUM per total head count, and average client size, and were then segmented into quartiles based on overall performance.

“These factors were representations of an adviser’s ability to attract and retain clients, and the team’s overall efficiency, ability to scale its practice, and success attracting high-net-worth investors,” researchers explain.

Key findings suggest that “truly shared decisionmaking” could be a lost opportunity for many practices. When it comes to the tenets of shared decisionmaking, the researchers point to frequent and detailed communications across all team members. In addition, teams of advisers seem to be better at fostering shared decisionmaking when the constituent members have all moved down the road of complementary specialization—with some team members focused on investing, others on working with clients to manage relationships and set goals, and a further group focusing on marketing or business development, for example.

The top-performing quartile of advisory teams have a broader mix of advanced credentials and are 1.5 times more likely to hold a Chartered Institute of Management Accountants (CIMA) or Certified Private Wealth Advisor (CPWA) designation.