Staying top of the game

Edward Jones is the retail brokerage firm with the heart of gold. For the eighth year, the financial-services firm Edward Jones was named one of the 100 Best Companies to Work For in America by Fortune magazine in its annual listing (ranking 29th overall). The firm ranked ninth on the magazine's Best Large-sized Company list. These eight Fortune rankings include top ten finishes for five years and consecutive number one rankings in 2002 and 2003.

In naming the firm to the prestigious list, the firm's ownership structure is one aspect highlighted that makes the company great. Edward Jones, organized as a partnership, has more US offices (8,955) than Starbucks has cafes – more offices than any other retail brokerage firm in America. In 2006, the number of limited partnerships was expanded from 4535 to nearly 11,000 – more than a third of employees. Edward Jones attributes a great deal of its success to its principles and its personal, long-term approach to investing. Like its customers, its employees tend to stay with them for years. Keeping hold of their staff is clearly an important factor – but how do they manage it so successfully?

The first place to look for an answer is in the firm’s particular culture, which is as important for its staff to fit into as their clients. The line its uses is that “Edwards Jones is more than a career, it’s a lifestyle”. When recruiting for both home office and financial advisory positions, the firm has strict values in place that must be respected: it is for this reason that not all candidates applying for positions will fit into the culture of the firm, just as not all investors do.

Unlike other retail brokerage firms, Edward Jones takes a personal approach to business. Their belief is that building long-term relationships with clients is key to serving their needs. "Whether it's in the United States, Canada, or the United Kingdom, we're located in the communities where investors live and work,” says Brad Scott, Principal of Human Resource Home-office and Branch Staffing at the firm. “We believe that's the best way to get to know them and provide the investments and advice they need to help them reach their financial goals.”

In locating employees from the communities they eventually serve, the majority of financial advisors employed by Edward Jones come from different industries, very few of them transferred from other brokerage firms. “In this sense a career at Edward Jones is a complete lifestyle change,” says Scott. “For most it’s an opportunity to work and get involved in their own communities and obtain that balance on life. From a home office perspective this is like one large family. We’re very family orientated, work-life balance is critical to the success of our associates – which leads to overall firm success.”

This is not the kind of thing you’d expect to hear about life in an brokerage firm. The typical employee, “those individuals who are looking to come in for two years to get experience and increase their market value” as Scott deems them, don’t fit at Edward Jones. “It was one of our previous managing partners, John Bachmann, who stated that not everybody fits in this firm, and that’s not a bad thing. Being family oriented we have a team approach in the firm. If you’re an individual who cannot work in a team environment, you will not be successful here. Long-term commitment and investment is the core of what we’re looking for. Individuals who respect our history, have a clear understanding of who our clients are, and are looking for long-term commitment are those who are welcomed at Jones.”

Given these parameters, getting the right mix of employees is vital. Scott goes on to explain that the firm sees talent acquisition as a long-term rather than short-term investment. Another factor to consider in the firm’s recruitment process is that they are a growth firm, meaning they grow organically rather than by acquiring other firms or companies. “This means it is critical we have the right mix of talent as we can’t just get it from other companies that we acquire. The mix needs college graduates, experienced talent, and internal growth. The challenge is fine-tuning that mix.”

College graduates are a useful source of diverse (and recruitable) talent for any firm, so it’s no wonder the Managing Partner of Edward Jones recently requested the number of internships for the firm be increased. “Given the fact that we’re a growth firm – we grew five percent last year and will continue to grow – it’s becoming more critical that we leverage recent college graduates, today and in the future. We’ve expanded the number of interns so we can better manage that mix. The point of internships are twofold at Jones: giving interns meaningful work – so we can understand both fit as well as talent – and giving them exposure to our firm prior to graduation and so they can see whether they see a fit with Jones. We also have an important inclusion effort that we continue to focus on – building a larger talent pool. As far as the talent we’re looking for, it’s across the spectrum, not only industry focused with research analysts, but across HR professionals, accounting, operations and so forth. Fit with our culture is the key thing.”

With such different requirements of potential employees than conventional brokerage firms, is it difficult to find appropriate staff? When attracting talent in St Louis, where the firm’s headquarters is located, according to Scott, it’s not too difficult. “We have a good story to tell, which makes the attraction for talent easier for us. Last year we filled 40 percent of our positions internally, which will probably increase again next year. We’re expanding our succession-planning program, building talent from within and then acquiring the right talent externally to supplement internal movements.” For Scott the key is again all about getting the right mix “We want to bring in fresh ideas but we’re an organic growth firm so we want to grow from within. We have some wonderful leadership programs, development programs … at Jones, associates own their own career. We don’t give them career paths, they are entirely responsible for the decisions they make. We practice responsibility based management within the firm so having that right mix is critical.”

Although its keen to give its staff this responsibility to develop themselves, Jones recognizes that its also important to bring external staff in as well. As Scott points out “if you only hire within, you miss those fresh ideas from new people and you also lose perspective of what’s going on in the industry - as well as outside the industry.” He goes on to explain that the firm looks at acquiring talent in much the same way as it does its own investment philosophy of "buy and hold" – focusing on long term results.

In recent HR and recruiting news, much has been made of the infamous talent shortage. But for Scott, this is a short-term problem. “Long term there will be plentiful talent out there, as the workforce expands. You must have heard the adage that 70 is the new 50. We haven’t capitalized on it yet, but it’s certainly something we’re going to focus on – how do we tap into that semi-retiree group? There are plenty of individuals who have held important positions in firms previously, aren’t ready to retire fulltime and they want to keep connected with the world of work.”

The talent shortage also poses a different problem for Scott: actually finding the talent. The talent is out there, but how do you cast a wider net for it? “That’s a valid question all HR professionals need to ask themselves. How can you get creative in attracting talent?” Scott raises job boards, which he describes as “necessary evils”, as an example of the problems he can face. “You need them to fill the positions because of the volumes of openings you’re dealing with, but the majority of applicants on job boards are active job seekers. We want to go after the passive job seekers, those individuals who might not know that they’re looking for another job, those individuals that we can network with and really sell our story to.” But as he is aware the chances are those passive job seekers have been at their existing employers for a number of years. “So we want to build long-term relationships with those passive candidates that will ultimately result in them joining our firm.”

Locating these passive candidates and initiating these relationships is an area that Edward Jones is already looking into, with some pilot schemes launching over the next few months. One is using the networking tool Jobster, which will allow individuals to join the Edward Jones network. As Scott says, individuals might not necessarily want to look for jobs today, but the network allows the firm to keep in touch with over a period of time so when candidates are ready for that opportunity, they have received enough information about the firm so they can make good decisions.

Another thing Edward Jones is planning is to pilot a webinar for some new roles in its HR department. It will push out invites for the event to listings of HR professionals. The idea is for people to spend 30 minutes and learn about Edward Jones and HR at Edward Jones. “Individuals can remain anonymous as they join the webinar and learn about opportunities at the firm, how we have reshaped HR at Jones, how HR is a strategic partner to our business areas,” says Scott. “After the webinar we will have senior leaders manning phones, so individuals wanting more info can call in and ask more questions.” The idea being that to attract the passive candidates it wants, the firm has to go out networking and invite those candidates to a place where it “can tell our story in such a way that they come away with at least an understanding of HR.” Scott confirms that although Edward Jones is piloting the webinar for HR, they are looking to implement it for other divisions within the firm too.

Although the methodologies are the same, increasing used of technology is helping firms like Edward Jones in extending hands to these passive candidates that everybody wants to reach out to. When asked about the use of technology, Scott points to one particular thing he believes the industry will see more of: a change in traditional applicant tracking systems. “If you think about networking, it’s all about contact management,” he continues. “Individuals and firms are looking at their applicant tracking systems and realizing while they might be great for tracking applicants, they’re not particularly good for keeping in contact with candidates: individuals who may not be ready for a move today but maybe ready six months from now. There may be candidates who we turned down for jobs today, but as they were such a strong candidates we may want to touch base with them once a month or every two months.”

In Scott’s opinion, contact management is where technology is headed. His primary concern is how to keep in contact with these talented individuals. Coming back to the subject of job boards, he remarks “they were perfect for their time but they’re becoming numerous, cumbersome, and focused on active candidates. If I could get just five qualified resumes for each opening, I’d be in heaven. But instead we get 30 to 40,000 resumes a month. Technology isn’t keeping up with our ability to effectively search through those. How do you streamline and focus on those four or five resumes instead of focusing on hundreds per opening?” Scott is not alone in his exasperation at the function of job boards. This is a problem that almost every business in America has faced at some point.

But how can those problems be solved? Self-selection tools based on online assessments are one way that Scott thinks candidates can do most of the work themselves, by selecting themselves in or out of various vacancies: “Using assessment tools, using the Jobster tool as well as other networking tools: those are all ways we see leveraging technology as beneficial as this industry continues to change. It’s not that different – it’s just the tools that support how we do it.” Scott accepts that referrals and networking are still critical modes of recruitment that have been in place forever, and will continue to play an active role.

So the way that Edward Jones approaches its staffing and recruitment needs hasn’t changed, over time. But Scott points out that to stay on top of the game, “we need to develop tools and be creative with our ideas to reinforce networking, to make us effective in it as well as strengthening our referral program.” For Scott the existing strength of its employment culture, means referrals from the firm’s associates are likely to be consistently strong avenues in bringing new talent into the firm.

Constant placing on the Fortune list only seems to have heightened the importance of maintaining this employee culture, as Scott confirms. “We have such a strong culture that values individuals, and we see associates as investments, we don’t see them as costs. That breathes the culture of the firm. It’s looking for our ability to match the culture with the potential candidate and the candidate who’s focusing on joining a family, looking for a long-term commitment, investment in the firm as well as in themselves.” With this mantra and the level of employee satisfaction they’ve gained, they’re likely to stay in the Fortune list for some time to come.