The Ramp Up of New Advisor Hires

FAQ: “When does a new advisor hire breakeven?”  Investment services directors usually face an uphill struggle when they want to hire additional advisors under the watchful eye of headcount-conscious CFOs.  That issue is compounded when it takes a signing bonus or transition compensation to land the candidate.  Directors would like solid information on the rate that an advisor’s production ramps up.

The Ramp Up of New Advisor Hires

We’ve been able to answer questions like this only with anecdotes or a few examples.  Until now.  Our database of 2,993 advisors from 165 banks and credit unions provides visibility into the actual experience of advisors as their tenure increases, since we have each advisor’s date of hire.  We essentially have detailed data on the production, situation, and characteristics of 11 advisors in their first month of tenure, 8 advisors in their second month, 19 advisors in their third month…and 17 advisors in their 48th month since they were hired.  Altogether there are 1,277 advisors in the database with less than four years of tenure.


In other research on this database—studies of the ROI of financial planning and the value of sales assistants—we’ve demonstrated that multivariate analysis can predict an advisor’s production with a high degree of accuracy.


We propose to analyze the ramp up process to understand:

  • The expected production level of the typical advisor at each level of monthly tenure.
  • The expected production of below and above average advisors, e.g., bottom and top quartile.
  • How those ramp up rates differ by whether the advisor starts tenure with some assets, either inherited or brought with him or her versus building a practice from scratch.
  • How ramp up rate rates differ based on the size of an advisor’s branch territory, whether the advisor has access to a sales assistant, or the advisor is part of a team.

These findings will help directors argue their case for hiring additional advisors or providing financial inducements to candidates.  And they will provide an additional tool for sales managers assessing whether a new advisor is making the grade—how does their actual production compare to the expected production of a typical advisor with the same tenure?  to a below average advisor?


Sponsorship fee:  $25,000