As published in RIABiz on September 21, 2020
RIAs who have left the wirehouses to set up shop often cite fiduciary reasons for doing so. They escape sales pressure, but many times they stop making sales altogether.
Next thing they know, they have no organic growth (aside from their original clients’ referrals) and may reluctantly need to sell themselves back to a giant institution.
At the center of the advisor sales dilemma is a dreaded word -- quota. Professionals know it as an inflexible performance metric applied to a task where technically we have no control over the outcome. See: How an ex-Goldman superstar asset gatherer in LA is bringing her bazooka to the RIA knife fight
The prospective client holds the signing power, the assets and the ability not to respond to voicemail messages.
What we know of quotas is that their rigid nature can force a broker's hand -- leading to deception, intimidation or even the opening fake accounts. Totally get that.
But a fear and disgust of quotas is counterproductive. Just because athletes want to win so badly they take steroids, doesn't mean we toss athletic competition.
A quota is simply a measure of accountability.