4 Tips for Smaller Broker-Dealers to Maintain a Successful Service Culture

4 Tips for Smaller Broker-Dealers to Maintain a Successful Service Culture

Whether or not you remain wholly independent or align your business with a larger network of firms, here are four key elements for success.

For small to mid-size broker-dealers serving independent financial advisors, it seems that the headwinds are multiplying. Advisors are getting older, as are clients with substantial accounts; meanwhile the regulatory environment grows more complex and time-consuming. It’s not that the business hasn’t always been faced with challenges, but more and more small and mid-size entities are asking themselves the existential question of whether or not they can continue to stay in business in their current form.

Several paths have been created in response. Some firms have simply chosen to close up shop, while others have sold out to the larger broker-dealers. Some have decided to valiantly soldier on as independent firms. Others have chosen a middle ground that consists of joining a bigger network that will allow them to maintain their identity and entrepreneurial integrity as a smaller firm within a larger group.

For the broker-dealers who opt to stay in the game, how do you preserve and protect that unique value proposition that allows you to service your advisors, keep them loyal, and thereby enable your firm to continue to thrive within today’s changing industry landscape?

Whether or not you remain wholly independent or align your business with a larger network of firms, here are four key elements for success. These actions, which will help to differentiate your firm and promote a constructive internal environment, are related to the human side of the business and the personal element that is injected into your firm.


Nurture Your Brand 

As corny as it may sound, every firm is unique. Every firm has a particular set of skills and an individual culture that has attracted independent advisors and kept them loyal. To maintain its success, an independent broker-dealer must identify its key characteristics and demonstrate a clear commitment to fostering and nurturing these attributes. The brand represents your service philosophy and how you translate this philosophy into action.

As such, a successful brand isn’t something you invent and impose upon your firm, but rather it is the result of an organic process that grows from within your organization. Once you establish brand equity, treasure and maintain it without letting it lapse. All too often, when a broker-dealer sells itself to a larger organization, the brand equity gets lost. However, maintaining it – either independently or within a larger network – can continue to yield tremendous value as you develop your business.


Reinforce Your History and Culture 

Similar to your brand, which represents management’s vision for fulfilling its service proposition, each broker-dealer is also a distinct community with its own culture and shared experiences. Like a family, a broker-dealer unites its members with bonds that can be close-knit, meaningful and lasting.

To foster its success as a service organization, a broker-dealer should find opportunities to create and recount these shared experiences, reinforcing its shared history and building upon it with new common experiences. This reinforcement can take many forms, including conferences, learning events, newsletters, videos, and continual verbal repetition in every corporate communication. The purpose of this is not only to inform, but to unite individuals and remind them of their common interests as part of the organization as well. In fact, most independent advisors are eager for this sense of belonging to a larger community. Ultimately, it promotes both loyalty and trust.

Maintain Your Relationship Managers 

One of our industry’s problems has been the rapid turnover among our senior advisor-facing relationship managers, as they are recruited from firm to firm and as consolidation restructures lines of reporting and organizational responsibility. But these executives can be critical components in maintaining a sense of cohesion among the group, in building trust, and in keeping advisors from looking elsewhere.

One of my favorite maxims is: trust takes years to build, seconds to break, and forever to repair. Especially for the broker-dealers being acquired or joining a larger firm, it is wise to recognize the importance of retaining successful relationship managers who often spend years building a bond of trust with advisor clients. As a result, this also means providing these executives with appropriate compensation, a sense of autonomy, or having a dialogue on what will keep them on board.


Make Senior Management Accessible

In addition to the loyalty of relationship managers, there is no substitute for the engagement and availability of senior management. Be ready to step in and deal directly with problems that arise or simply hold the hand of an advisor going through a period of uncertainty. This accessibility and responsiveness often cannot be planned or scheduled in advance, but is a vital component in managing a business that is highly people-centric.

Unfortunately, in today’s complex world, many senior managers are taken up with other concerns – whether the demands of shareholders, regulators or any of the million other worries that running a business engenders. Regardless, our main priority must continue to be service to our advisors, without whom we would have no business at all.


For a small or mid-size broker-dealer that’s either part of a larger network or fully independent, following these concepts to preserve and protect a firm’s boutique service culture can be a valuable contribution to a successful future.


Susan Woltman Tietjen is Chairman and Chief Executive Officer of Girard Securities, Inc., member FINRA/SIPC, a mid-size independent broker-dealer with Cetera Financial Group (www.cetera.com). Cetera Financial Group is the retail investment advice platform of RCS Capital Corporation (NYSE: RCAP), a full-service investment firm expressly focused on the individual retail investor.

Hide comments


  • Allowed HTML tags: <em> <strong> <blockquote> <br> <p>

Plain text

  • No HTML tags allowed.
  • Web page addresses and e-mail addresses turn into links automatically.
  • Lines and paragraphs break automatically.