Every minute of every day, in every sector of the economy, whether a firm wins or loses the ferocious battle with its competitors depends on optimizing the abilities of the professionals who serve the firm’s customers.

In the service sector, where the product is the service, customer loyalty is re-evaluated with each encounter. Financial services in particular experience the most intense battles for clients’ hearts, minds and wallets, due to the feelings of security and self-worth attached to money. For this reason, one invariably finds financial services firms that insist on the highest quality, talent, skill and sound management for its client-facing personnel.

What is the service paradigm that wealth management firms use to stay focused?

Key to success is to hire the best people for the job. Factors used to predict success for new recruits include education, evidence of leadership, resilience in the face of adversity, and an ability to bounce back from rejection or handle a difficult conversation with an irate client.

Another trend toward the optimal service model is to organize personnel into work teams. Teams can include professionals with complementary skills who can address clients’ varied investing and borrowing needs. They may range in size from just a few people to several hundred or even thousands. Wealthy clients have complex financial needs calling for sophisticated solutions and are typically cared for by small or midsize teams of dedicated, highly skilled professionals. Even the less wealthy, whose financial lives tend to be simpler, can be served by very large, nondedicated teams of professionals who collectively possess the right set of skills to address their direct, and often urgent, needs.

The emphasis in managing a very large wealth management team lies in the group rather than individual members. Performance metrics ought to be closely monitored, such as the number of client calls taken, how many issues are resolved, the time that clients spend waiting to be served and the percentage of the team’s available time used to serve clients.

The role of analytics is crucial. Sophisticated mathematical models can improve the ability to forecast demand for service at every hour of the day, every day of the week. This helps determine the right staffing level for the team—not too thin so that clients experience lengthy wait times, and not too large so that the team becomes unprofitable to operate. Statistical methods can help identify clients most likely to engage in specific financial planning activities so that clients can be routed to the team members with the right set of skills to address them. Such methods can also match financial products with subsets of the client population that may need—annuities for retirees, for instance.

A factor that may add complexity to workforce scheduling for wealth management service teams is the emerging trend of outsourcing back-office tasks, especially to offshore locations in Asia or Europe. Time-zone differences and high turnover of trained professionals can be serious issues to contend with and may even affect the performance of client-facing professionals. Potential remedies include: careful selection of third-party providers to outsource tasks to, service agreements that include appropriate incentives to third-parties to provide the best possible service and cross-training of third-party staff in multiple skills.

Editor’s note: For more details on the operational aspects, see the peer-reviewed article that Hatzakis; Prof. Mike Pinedo of New York University Leonard N. Stern School of Business; and Suresh Nair, GR’96, published, “Operations in Financial Services: An Overview,” which covers all research on the topic. Hatzakis would like to acknowledge David Blackwell, Filippo Ilardi and Denis Shovkoplyas for providing comments on the original manuscript.