Empowering others to succeed is the essence of leadership. For asset managers and investment professionals in—or near—the C-suite at their firms, this mandate extends beyond their subordinates: They must also effectively serve the needs of the financial advisors and wealth management firms they interact with daily. This is true along the entire food chain within financial services, where synergies between industry constituents form the fabric of the whole ecosystem.
What knowledge and skills adequately prepare leaders to do an effective job in a constantly evolving financial services landscape? Despite ongoing tech innovation constantly reshaping the industry, it remains relationship driven. Still, specialized technology is playing an increasingly outsized role in a firm’s ability to meet clients’ demands in areas from portfolio customization to tax efficiencies to research and analytics.
How important is it for these executives to remain well-versed in the latest digital solutions and strategies to equip themselves to thrive in this environment? We asked three high-level industry players for their thoughts:
- David Scranton, CEO and Founder, Sound Income Group, a Fort Lauderdale, Florida-based, diversified financial services company whose affiliate Sound Income Strategies is an SEC-registered RIA
- Robert Battista, CFA®, Senior Vice President of Advisory Solutions and Managing Director, Vestmark, a leading provider of portfolio management/trading solutions and outsourced services for financial institutions and their advisors
- Tim Williams, Executive Vice President, Director of Education Initiatives, Money Management Institute, an industry association representing financial services firms that provide financial advice and investment advisory solutions to investors
David Scranton – The first thing to remember is that financial advisors are always leaders to their clients, and they should never forget they have that responsibility. Leadership roles exist at every financial firm, even if you are a solo financial advisor. You’re likely to have at least one support staff and you’ll be a leader to them. Of course, as your team gets incrementally larger, you spend more time as a leader and less as an advisor. Investment professionals will need to determine if that’s an acceptable shift in responsibilities. It’s ok if they don’t. Some advisors prefer to stay out of leadership roles because they enjoy their work-life balance, success as a financial advisor and helping clients. There’s nothing wrong with that.
Investment professionals should also recognize that you don’t have to be in management to be a leader. You could mentor advisors or support staff.
Staying well-versed in digital solutions does have a role in assuming leadership positions from an education and strategic standpoint, but it’s not a crucial skill in becoming an effective manager. It’s not cost-effective in terms of money or time to chase technology because it seems cool. You may spend more time trying to implement the digital solution than having it create time for you to grow your business.
Robert Battista, CFA® – To prepare for leadership roles and effectively serve wealth management firms, asset managers and investment professionals must stay abreast of the latest digital solutions and strategies. Embracing technology positions them to offer more sophisticated and personalized solutions. For instance, VAST’s tax management services enable asset managers to quickly launch tax-managed versions of existing strategies, providing firms and advisors with enhanced options. Additionally, VAST’s tax transition services allow clients to adopt new strategies without incurring significant tax penalties.
Tax transition services are particularly valuable for clients with accounts with embedded capital gains. With tax transition services, an advisor can seamlessly move from one firm to another, bringing their clients along while mitigating the impact of the move from a tax perspective.
Our partnership with leading global investment management firm Invesco underscores the importance of integrating advanced services like tax transition capabilities, which facilitate smooth client transitions while minimizing tax implications. Such innovations not only attract and retain advisors but also differentiate firms in a competitive market by demonstrating strategic foresight and client-centricity.
Tim Williams – You never know whether you’re “adequately prepared” before you’re put to the test. However, there are key elements to any leadership role – formal or informal – that should be developed and honed before the opportunity arises. These include effective communications, strategic thinking, emotional intelligence, adaptability, and a strong understanding of the industry and organizational dynamics. These ‘softer’ skills will be the key differentiators to successful career growth and critical for effective leadership.
Staying ahead of the curve on industry developments, including the digital transformation and technology disruption currently taking place, is also critical for a good leader. We need change agents who can lead our organizations forward. Without an appreciation of the main drivers of innovation – and the leadership skills required to harness it – organizations and their leaders face the real threat of obsolescence.
Money Management Institute is a crucial resource for current and emerging leaders to stay current with industry trends, develop a deeper network, and gain new competitive skills. We see leaders who complete our programs more successful in navigating and confidently leading their organizations forward.
