Upgrading talent, a process that can be rife with challenges when an incumbent is in place, can yield outsized rewards for asset managers that are strategic about positioning themselves for the changing landscape over the next decade and beyond. Concerns about a market correction and the persistent headwinds facing the industry are compelling firms to consider all options, particularly for highly compensated roles. Those firms that can afford to be opportunistic will likely be beneficiaries as the market continues to bifurcate into winners and those struggling to survive.
In 2019, we assisted several clients in accessing the market for alternatives to existing leaders who may not be suited for the challenges and opportunities that lie ahead. Strong leaders who are concerned their organizations may not thrive, let alone survive, are becoming receptive to firms they believe are well-positioned for the future. This could further contribute to the upgrading trend we’re observing in the market.
The process of replacing an incumbent can be delicate. Extremely sensitive situations may require explicit NDAs or, at the very least, an implicit agreement to maintain confidentiality. Whether it involves a recognized business leader, a key relationship manager who controls significant client assets, or a high-profile investor who manages billions and is the face of a franchise, the right strategy can help minimize potential fallout.
At Jamesbeck, we believe it’s critical for talent leaders to partner with hiring managers to craft thoughtful succession, upgrade and transition plans. Be deliberate in approach. Control the narrative. Bring people into the tent on a need-to-know basis. Gain buy-in from valued partners and team members in order to avoid significant business disruption (e.g., potential client, asset, and employee defections). Discretion is essential; enter the market in a highly curated manner. Ensuring the confidentiality of the process and maintaining control over shared information will allow firms to take advantage of a unique time in the market to strengthen their organizations and increase the likelihood of continued long-term success.
For more information, or to dialogue on any of the ideas addressed in this piece, please contact me.