The 3 criteria that must be satisfied to justify the hassle and the risks of a transition

There are plenty of reasons why advisors change firms. For example, there are those who have a desire to monetize their business; others who want to join forces with a team at another firm; and some who are answering the entrepreneurial call of independence.

Yet, we find that the vast majority of moves are motivated by something that reaches well-beyond the pushes of frustrations and the pulls of opportunity: It is the belief that the grass will be greener elsewhere.

If an advisor is frustrated enough, it’s typically possible to find an option that’s “better”—but “better” isn’t always worth the hassle and the risk inherent in a move.

So, we subscribe to a theory that sets a higher bar—that is, for an advisor to justify the value of a move, he must ask himself, “Will the grass be greener enough elsewhere?”

How to define “greener enough”

We speak every day with advisors who are experiencing varying levels of frustration with their firms. Increasing bureaucracy, new comp plans, higher expectations, cross-selling mandates, and loss of trust in senior leadership are all part of a growing list of cultural changes that increasingly limit advisors within the brokerage world.

But frustration should not be the primary motivation behind a move.

Surely, to justify a transition to another firm or model, the pain of staying put must be significant. But there must also be an option waiting on the other side that positively impacts these 3 key areas:

The ability to serve clients better and more freely;

the ability to grow faster;

and the ability to increase earnings.

If a move doesn’t meet these criteria, then the advisor might be wise to accept the imperfections of the status quo and stay put from a position of greater strength.

The reality is that a move can be disruptive all-around. So, it’s critical that the decision-making process is mindful and deliberate—and rooted in a clear vision, well-targeted goals, and with a longer-term, big-picture view. It’s from this horizon that an advisor can more easily assess whether the status quo at his own firm is indeed “greener enough” or he might be best advised to seek greener pastures elsewhere.