Insights | 11.23.21
The Difference Between Good and Great
At last month’s Kehrer Bielan Leadership Study Group in Chapel Hill, Peter Bielan presented an analysis of the difference in good performance and great performance among financial institutions that provide investment services. Using data on the 406 firms covered by our 2020/2021 benchmarking surveys, he compared median performance on key metrics with top quartile performance.
For the universal measure of advisor productivity (gross revenue per advisor) median, or “good” performance is $328,367. But “great” performance (at the top quartile) is $459,034. Great performers produce at least 40% more than good performers.
The premium for great performance is even larger for new investment assets acquired per advisor, advisory revenue production and the key performance driver advisor deposit coverage.
In creating the methodology for our annual Top Directors Awards, we took this analysis to heart; we aim to recognize great performance, not good performance.
We selected 11 performance metrics from the 50 we report in our custom dashboards and ranked the 406 firms on each metric. But firms received award points only for the metrics where they ranked above the top quartile.