Published in The Globe and Mail on July 2, 2024

As an older generation of wealth management professionals retires, many firms can’t hire new employees fast enough to replace the baby boomers who are exiting the business. That’s true not just for wealth advisors, but also for technology, operations and other critical roles. It’s time for a new approach.

In an era of tight labour markets, hybrid work and rapidly evolving worker expectations, firms must move the responsibility for fielding a satisfied and productive workforce out of the human resources (HR) department and onto the desks of senior managers in charge of strategic planning.

Meeting the needs of employees and businesses

Historically, HR handled tasks such as hiring, onboarding and training in conjunction with a business manager or direct superior. That simple model worked fine when talent was easier to find and retain, and everyone was (mostly) working under one roof. Today, young professionals have more options, and they’re using their leverage to demand more satisfying jobs and work arrangements.

One of the most common demands from young professionals is to work from home. While most wealth management firms have the basic foundation in place for hybrid work, the industry is still experimenting with policies.

Amid this experimentation, it’s easy to get caught up in the “number of days in the office” argument. Should it be two? Three? More? Less? That’s an important question, but there are more pressing issues. For example, companies worldwide are finding that hybrid work gets harder the longer they do it.

When work-from-home first took off during the COVID-19 pandemic, it worked quite well for most companies. The reason: the employees logging in from home in 2020 had spent their entire careers working side-by-side in the office and understood the business, workflow and culture. They also learned, from both observation and direct conversation, how people advanced their careers.

As we’ve discovered over the past four years, that knowledge doesn’t flow easily via Zoom calls and Slack threads. There’s a real risk that employees working from home – even partially – never integrate into the company culture fully, never form close relationships with co-workers and superiors, and feel overlooked or even boxed out from advancement.

That’s a recipe for low morale, low productivity and high turnover. In an age of over-sharing on social media, that environment will begin to affect the company’s reputation and make it harder to attract new employees.

Wealth management firms must strike a balance that meets the modern needs of their workforce while fostering strong team dynamics. Building out technology platforms can help integrate new employees while mentorship programs can be used to pass down knowledge.

Using technology to create a more attractive workplace

How can technology contribute to a better workplace? For starters, companies must have a solid technology foundation that supports seamless hybrid work.

But wealth management firms will have to go further. As technology is playing an increasingly important role in the business, having top technology professionals is becoming an important competitive advantage. The best way to attract top tech talent is to deploy a best-in-class technology stack that allows professionals to work on challenging applications integrating artificial intelligence (AI) and other innovative tools.

Across all job types, wealth managers should be experimenting with ways to harness the power of AI to improve employee satisfaction. ChatGPT and other AI and machine learning applications allow companies to automate routine tasks. By outsourcing this mundane work to AI, companies can free up their employees for more interesting, challenging and rewarding assignments.

Organizational practices for a new era

While building out technology platforms, wealth managers should also devote attention and resources to policies and programs that integrate new employees, spread the corporate culture, cultivate leadership, and open career paths for workers in hybrid work environments. Programs that integrate and “upskill” employees keep workers engaged, improve retention and make the workforce more effective.

Mentorship programs can ensure the next generation inherits wisdom from experienced employees. These programs can be supplemented with cross-training opportunities, job shadowing and rotation programs, as well as documentation and knowledge repositories.

These examples are just some of the initiatives wealth managers will have to adopt to preserve their culture and maintain a workforce of satisfied hybrid employees. By blending innovative technology and creative organizational policies in this manner, senior management can create a workplace that appeals to the young, talented professionals needed to replace the outgoing generation.