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Recognise talent

Staff retention is a problem for many firms and one solution is to offer more opportunities for career development, says Christine Toner

The biggest challenge faced by employers in 2007 will be holding onto their staff, according to business website

This is nowhere more true than in the mortgage industry. A shortage of advisers means employers are having to do more to hold onto the staff they have. And with rival firms offering some impressive golden handshakes, this is by no means easy.

The well publicised recruitment crisis in the mortgage industry has left employers with two options – keep the staff you have or train new people. Some employers are taking no chances and doing both.

Many brokerages are aiming to expand and to do that they need staff – a resource that is hard to come by. For example, London & Country has 119 qualified brokers. Alexander Hall has 75 and newer kid on the block Cobalt Capital has 30. All three firms claim their staff figures are rising thanks to the training programmes they have in place.

But it is not simply a case of replacing people or getting new ones. Employers also have to hold onto the talent they have. So in a growing sector, how challenging is this?

Despite the hype surrounding the issue it seems that firms are still losing staff to rivals. Many mortgage firms are reluctant to acknowledge the problem and none are willing to reveal what retention tools they have in place.

Home of Choice says its recruitment success is down to offering the right proposition that meets Treating Customers Fairly requirements for brokers and clients. This covers commission, payments and point-of-sale support using technology and the best product providers.

HoC managing director Gerry O’Brien says using specific retention tools is a sign of a shady outfit.

“If networks offer bribes or loans as an incentive to recruit or retain members, you can be sure there is something intrinsically wrong with the contract you are about to sign and this will impact on clients,” he says.

Brokerages are no different, with most claiming that keeping hold of staff without using retention tools is not a problem.

James Cotton, mortgage specialist at London & Country, credits a good working atmosphere for his brokerage keeping hold of its staff.

“L&C works hard on cultivating a culture that makes work an enjoyable place to be, which is often a far more important factor and better retention tool than cash lures,” he says.

“Employees are also able to participate in a performance-related share option scheme.”

Cobalt takes a similar approach. Partner Andrew Montlake says the company’s flexible attitude towards employees is a pull factor.

“The main point is that being an independent company in control of our own destiny we are able to adopt a flexible approach with our consultants,” says Montlake. “We also offer a level of administrative support which is second to none.”

But while they may not admit they try to stop staff from leaving, most brokerages offer employees impressive salaries and large bonuses in what could be construed as golden handcuff deals.

Alexander Hall offers a salary of £22,000 for trainees, with no qualifications or experience required. Impressive when you consider the average starting salary for a graduate is £18,197, according to And this figure rises significantly once training has been completed.

“When trainees obtain CeMAP and start the mortgage broker induction course they are provided with a training salary of £30,000 for six months until they start to earn commission,” says Andy Pratt, chief operating officer at Alexander Hall.

Cobalt also claims to offer a generous package as well as a commission deal based on experience and levels of business.

Networks, like brokerages, are becoming more aware of the effectiveness of substantial packages. Dev Malle, head of distribution at Personal Touch Financial Services, says its employees have received average annual increases of 9% for the past three years.

“It is critical that our teams don’t only feel valued but also that they are working towards our goals,” he says. “It is essential to maintain a buzz in our business.”

However, impressive salaries and benefits are not necessarily what attracts employees to companies. Many are more drawn to promotion opportunities.

Four years ago, broker James Rodea left Savills Private Finance after working on an internet project that was shelved because, as he puts it, “the market just was not ready to transact high value mortgages online”.

He moved to Hamptons Mortgages taking a pay cut. After three years at Hamptons, Rodea moved again after he became uncomfortable with his working environment.

“The managing director told myself and the other director that he was drawing a line in the sand over friendship despite three years’ work setting the firm up, and that we would have to reapply for our jobs,” he says.

“I did not agree with the direction the company was heading in, nor did I believe I should have to reapply for my job so I let a few people know that I was drawing up my CV.”

Rodea received several offers, the most tempting of which he says was setting up a brokerage for estate agent Cluttons. But despite success at Cluttons, Rodea was lured back to SPF by the buzz of a larger company.

“After 18 months at Cluttons I was approached by SPF managing director Mark Harris to come back,” says Rodea. “I was not unhappy at Cluttons but it was small and I enjoy the challenges afforded by a larger company.”

Money was an issue but not the overriding factor in Rodea’s decision.

“My salary did not increase when I came back to SPF but I am expecting to earn more in total because the company is far more profitable,” he says. “My decision came down to challenge, atmosphere and money, although any bonus earned is discretionary.”

Most brokerages are aware of the importance of promotion prospects. Cotton says L&C has a career progression from it’s training academy to senior supervisor level.

“Most supervisors come from within the company, having been advisers in the past and stepping up to manage a team of brokers,” he says. “Similarly, many case managers and administration staff have moved into advising roles.”

Cobalt also offers opportunities for promotion.

“We are lucky as we are a young, growing company and have a lot of flexibility to offer career paths to suit individuals,” says Montlake.

Pratt agrees that understanding the needs and ambitions of staff is key to holding onto them.

“In an expanding business like Alexander Hall there are opportunities for sales management or technical roles,” he says. “But the key is to understand your staff and help them achieve their goals.”

Development and training plays an integral part in most firms’ retention strategies with several setting up training academies.

Malle says staff at PTFS are motivated through promotion and given the opportunity to expand their knowledge by changing their roles.

“We see our appointed representatives as a part of our team and give them plenty of training and support,” he says. “Our retention levels speak for themselves.”

Alexander Hall and L&C have training academies. Cotton says training staff helps guarantee loyalty.

“Our turnover rate is low,” he says. “Many brokers are now looking at bringing in recruits from outside the industry but we have been doing this for years.

“Not only does it build a great spirit in the team but it also avoids taking on people with preconceptions.”

Employers are realising that holding onto staff takes a lot more than a decent pay packet and a couple of extra days’ holiday per year.

Employees are looking for career progress, and retention strategies are starting to reflect this. Brokerages know they need to offer more than generous salaries. As they say, all that glitters is not gold.


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