American Express Financial Advisors, through its 7,000 independent brokers across the country, is going on the recruiting warpath. The firm is trying to get less experienced brokers, including those that have been laid off, to serve as associate advisors to their independent affiliates around the country.
In a plan currently being tested in several states in the Midwest and South, Amex is creating an “associate advisors” program. Essentially, newer brokers will start in a junior position to Amex's independent contractors. The firm is hoping to hire between 100 and 500 of these associates in 2003, says Barry Murphy, executive vice president of the retail brokerage group. “A lot of big firms are laying off people explicitly,” he says. “We hope we can attract those people.”
Murphy says AmEx will work with individual franchisees to match them with associates, but the process is a less centralized one than used in the past. It's not something Amex has done before, as it had mostly hired brokers to open their own independent offices, or hired brokers to work in captive branches (Amex has 3,000 of these brokers). The independent affiliates will be doing the hiring — so many will be bosses for the first time.
“Lots of clients want this, but not a lot of advisors are ready for it,” Murphy says. “It's a decentralized way to grow. It's definitely not a downtown branch model.”
With the job title comes a few things that some brokers might be looking for with independence, such as more autonomy and a “small business” environment — but it's a soft step, smaller than stepping out and starting one's own office. The associate advisors will be licensed, grow a client base, and have a book of their own, but will be mentored by the established franchisee.
Amex's role, according to Murphy, is to check compliance records, to handle due diligence, and find ways of helping match advisors with prospective associates. “Sort of like a dating service,” says Murphy.