Tash Elwyn of Raymond James says the wealth management industry has become analogous to a giant barbell graph.
On one side are large wirehouse firms with huge advisor headcounts but also some difficulties retaining the talent they've worked so hard to amass. On the other side, said the president of Raymond James' Private Client Group, are the many regional and small firms that wealth managers often move to in search of greater independence. For them, the difficulty is often in not having the size to deliver the array of services advisors were used to having at their previous employers.
Elwyn said his goal is to position Raymond James somewhere in the middle of those two extremes.
"It's almost as if advisors today that are looking for a better experience for their clients and their business have to choose between capabilities or culture," Elwyn said in a recent interview. "So when you think about where Raymond James is enjoying recruiting success and momentum, it's from across the entirety of that barbell. It's with advisors that embrace the opportunity at Raymond James to have national firm capabilities coupled with a small firm culture in terms of accessibility and responsiveness."
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Like many firms, Raymond James seeks to ensure advisors have plenty of choices for how they want to run their businesses under the firm's umbrella. As head of the firm's Private Client Group — the name of the firm's U.S. wealth division — Elwyn is in charge of overseeing all of the options.
Those include the firm's channel for direct employee advisors, Raymond James & Associates, and its independent contractor division, Raymond James Financial Services. Elwyn also oversees Raymond James' institutional channel, which works with wealth managers in banks and credit unions, and its RIA and custodial services.
Elwyn said one goal with having so many affiliation options is to allow Raymond James advisors who might be growing restless in their current situations to at least consider simply moving from one channel to another. Elwyn said he thinks that Raymond James is one of the few firms that recognizes advisors are the ones who ultimately choose which firm they want to work with.
"I think that stands in stark contrast to many other firms in the industry that have added taller walls around advisors," Elwyn said. "They seem more focused on detaining advisors than retaining advisors."
Elwyn's path to his current role, which he stepped into in October as part of a
"I think, as you look across the industry today, that is far less common than it once was," Ewlyn said. "At many firms in the industry, leadership has not sat in all these seats as they have in our Private Client Group."
Elwyn sat down with Financial Planning to discuss Raymond James' recent decision to stop reporting quarterly advisor headcounts, how firms seeks to "retain" advisors rather than "detain" them and the growing presence of private equity in the wealth management industry.
This article has been lightly edited for clarity and brevity.
Financial Planning: You say you're looking to retain advisors rather than detain them. Advisor attrition is obviously a bigger source of concern in the industry today. What are you doing to combat it?
Tash Elwyn: One of the many things that makes Raymond James as unique as we are is the belief in what we refer to as advisor choice, which is the concept that to the extent anyone owns the client relationship, if you will, we believe that really exists between the advisor and the client.
We, in turn, embrace the advisor as our clients. And so that very client-centric and advisor-centric culture at Raymond James differentiates us because we embrace that all of our advisors that are affiliated with us are here by choice. That inspires the entirety of our home office to deliver best-in-class capabilities, technology, investment solutions and high-touch service such that advisors continue to reward us with their loyalty.
FP: Raymond James recently joined the trend of not providing advisor headcounts in its quarterly earnings reports. Why?
TE: I think the best reflection of the success of Private Client Group advisors' collective ability to service their clients are total assets under administration and
FP: Are headcounts less significant because advances in technology have greatly extended the services that, say, a single advisor or small group of advisors is able to offer?
TE: I think an advisor is providing much more sophisticated and complex solutions to clients than ever before. Said another way, advisors are adding more value to their clients' experiences and outcomes than we've ever before seen in the profession. Not only are they doing more for clients, but they're doing more for more clients. That leads to really underscoring the importance of technology and innovation, which is why Raymond James has been so focused on ensuring that we deliver best-in-class technology capabilities for advisors.
FP: Speaking of retention, Raymond James saw some
TE: As we've seen in a number of other professions — whether it's the medical industry or the insurance or accounting fields — private equity has seen opportunities to try to build scale. But with the valuations in the private market space versus public market space, it's going to be very difficult for private equity firms to really extract and create the value that they need to for their investors without significantly impacting how those advisors that have been aggregated are going to manage their clients.
So you see streamlining, you see imposition of investment model management, and it really erodes a lot of the autonomy that, I think, is what has attracted so many advisors to the profession today. Certainly that autonomy is what Raymond James advisors value.
FP: Back to how technology is extending advisors' ability to deliver services, what is Raymond James doing with artificial intelligence?
TE: A number of years ago, when robo-[advisors] entered the lexicon of many in the industry, people were questioning: What impact is that going to have on human advice, and will advisors go the way of the dinosaur, etc? But quite to the contrary, we've been able to demonstrate at Raymond James that you can leverage technology, you can leverage AI, to reaffirm the advisor as the center of the universe and the center of the relationship, not only to the client, but also in importance to Raymond James..
There's a number of ways that AI can and is being put into practice, including using AI for automation and repetitive task management and so forth, both at the home office and in the field. And that gives both our home office teammates, as well as our advisors and branch professionals, more capacity to focus on what we as humans do best, which is to engage person to person, and to be able to deepen relationships and add more value.
