There are certain characteristics firms have in common simply due to their size.
Being aware of the pros and cons of joining a small or a big firm will be helpful when choosing an employer.
What should new entrants take on board?
Training and support
Larger and smaller firms are likely to differ in their approach to training and support. Bigger companies tend to have bigger budgets, so are more likely to invest in areas that benefit new entrants, such as training programmes.
“A large employer is likely to offer a more structured and formal training programme,” says Kristian Derrick, director at mortgage broker Mortgageable.
“Trainees at a large firm may also have access to more resources, such as specialist teams, software and compliance support.”
A new entrant should consider a firm’s values, culture and vision, regardless of its size
But such resources do not necessarily make things easy for new starters.
“Many of these tools need their own training sessions, which you will probably still not grasp until having used them multiple times,” says Medina McKenzie, a financial planning consultant at Octo Financial Planning.
McKenzie notes that big firms provide training in how to speak to clients, listen to them and advise them. But, despite this support, finding your own clients can be challenging.
“You are told which companies offer client lead generation services and which ones advisers within the company are using and being successful with,” she says.
“Typically, most of these services require you to spend a lot of money in the hope of landing the client. But there is no certainty as to whether the client will want to use your service or is even in a position to do so.”
Big firms may have more formal, hierarchical cultures, while smaller firms may have a more informal and entrepreneurial style
McKenzie feels smaller firms are more likely to appreciate that new entrants need time to build a client bank, as well as their confidence and their own style as an adviser.
“They are happy to give you support in choosing how you would like to work and how much you would realistically like to achieve in terms of earnings early in your career,” she says.
Kelly Biggar, head of practice at financial services recruitment firm Fram Search, adds there can be more flexibility, less red tape and a family-style work environment at smaller firms.
Smaller companies can allow individuals to make the role their own and play more of a critical role
“They may have a more personalised approach to client service, which can lead to deeper client relationships and more referrals,” she says.
Career progression
The kind of training and support provided by advice firms can shape the career progression of new entrants in all sorts of ways.
Smaller firms may offer more hands-on experience in different areas of the business.
“Smaller companies can allow individuals to make the role their own and play more of a critical role within the business,” says Alice Shaw, a wealth planner at Succession Wealth.
Smaller firms are more likely to appreciate that new entrants need time to build a client bank
“Often in a small company you get involved in various functions, which can really boost your knowledge early on.”
Shaw adds that, within a small firm, it is easier to influence changes in processes and functions. Expanding on that, Biggar observes that senior leaders and decision makers can be more accessible at small firms, providing important mentoring and networking opportunities.
“However, career development may be slower,” she adds.
Reality check
A faster climb up the career ladder at a larger firm that has more roles may sound appealing, but the reality can differ from expectations.
“The expectation is that you will suddenly be blessed with an abundant flow of clients and will be making thousands of pounds within months as you are armed with this newly received diploma,” observes McKenzie.
Trainees at a large firm may have access to more resources, such as specialist teams, software and compliance support
She says a trickle of clients while you find your feet is more likely.
“As a new adviser who isn’t really earning and is trying to build a client bank, you are expected to spend money to make money,” she adds.
“However, many do not have that money to spend at the beginning.”
Culture
Business culture — a mix of norms, values and behaviour — will differ from firm to firm. Commentators see this as a crucial factor in whether an individual and a company provide a good fit for each other.
“When joining a financial advice firm, regardless of its size, the main things a new entrant should consider are the firm’s values, culture and vision, and whether these match their own,” says Biggar. “This is more likely to be the reason they stay and progress within the firm.”
A large employer is likely to offer a more structured and formal training programme
As Derrick says, the culture of a firm “can have a significant impact on job satisfaction and career progression”. Put simply, some people thrive in work environments where others would struggle.
“Big firms may have more formal, hierarchical cultures, while smaller firms may have a more informal and entrepreneurial style,” he adds.
Ultimately, new entrants should think about their career goals and personal preferences when choosing between a big or a small firm.
This article featured in the June 2023 edition of MM.
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