I'm an editor here at Registered Rep., and I'm writing a story on the topic of team compensation. I'm interested in hearing your thoughts/experiences with this, how it works/doesn't work, how you think it's changed over the years, and where it's heading. Are some brokerages better at this than others? What sort of rationales do they offer for the way they structure compensation by team? Do they make sense?
Reach me here, or email at [email protected] or call 212-204-4261. Many thanks.
Most firms seem to encourage teams - better client coverage, client service, leverage strengths of team, etc. But few are willing to aggregate the team revenue to hit a higher grid level vs. each person hitting their own grid level.
In reality, many firms encourage teams as a method to keep assets if a member leaves.
Ask people on a team "what do the other members bring that you don't have and what do you bring them?" The answer is usually very short on what the other team members bring to the team. If that is the case, why be on a team? Good teams have members who have specific skills, capabilities, knowledge...
Its very hard to come up with a split, most members believe they put in more effort/time than the others, the senior member believes he/she earns a higher split due to time building the book.... A member that primarily does account reviews is not compensated as highly as the one who brings in the new large clients... its the same at a small or large law firm, the newer team members get a lower split and have to earn their way up.