Can advisers benefit from offering apprenticeships?

0:11Welcome to this FT Advisor podcast. I'm Carmen Reichman, Multimedia editor at FT Advisor, and with me in the studio today is Sally Plant, Relationship Director at the LIBF. The LIBF, also known as the Walbrook Institute London, has recently launched three pathways for advice businesses wanting to take on apprentices to train for their Level 3, 4 and 6 qualifications. Sally, could you explain to us why you launched these and how they work? Yeah, I mean, apprenticeships are commonplace in the professional space now. and within financial advice what this gives particularly smaller to medium-sized firms is a real opportunity to take someone new into the profession in a structured program that is sort of a bit of plug in and play because the program is there for you but they it enables them to have a tutor it enables them to get their qualifications it enables them to build all the softer skills and the behaviours.

1:12So I often say about apprenticeships, you know, we talk about in planning, we all want to deliver goals-based planning. We all want to deliver holistic planning because it mitigates the risk of missing any need. An apprenticeship is holistic learning because it matches those skills, behaviours and the knowledge. So it's not just the qualifications and the knowledge component. It is all three. The three pathways, level three is for the administrator. This is absolutely ideal for someone who is coming in either as a career changer or a young person, an 18 year old. And we've had lots and lots of business owners contact us because their son daughter wants to come into the profession or their son daughter's friend wants to come into the profession.

1:59And it's a one year program that enables them to get up to the profession standard of best practice to be an administrator. And imagine what the return on investment is for the business if you've got someone who is delivering that high class, client centric, efficient administration. This is also brilliant for people who are already within your business as an administrator, because all the things they will learn from the other peers going through the practice and they will basically come up to the professional standard that you expect and you want. Level four is for those that are trainee power planner and trainee advisor.

2:46So those two standards were merged and there is one standard for both areas and that really takes you through a two-year program and again touches everything from the softer skills in terms of client conversations. Your qualifications are obviously in there. LIBF has done something pretty unique with our qualifications, and this particularly works for apprenticeships. Obviously, irrespective of whose qualifications you take, they're all matched against the APAC standards. So effectively, you are learning the same content up until level four. LIBF and Woolbrook, what they have done is they have split some of those chunkier qualifications that aren't necessarily so relevant to the job you're doing.

3:30For example, regulation. I'm sure many of your listeners remember that qualification. And they've done it into two modules. We've also just won an award for operational excellence because that all sits within your learning space. So should you want to, you've revised all weekend and you suddenly think, goodness, if I could take the exam now, I think I'd probably pass. And you can go into Brightspace and you can launch your exam. So it's entirely flexible. And why that works so well for apprenticeships is because obviously within an apprenticeship structure, you are learning on the job. So you've got a job.

4:03You're busy. You're client centric. You're delivering for your firm. And on top of that, you've got these qualifications. So by doing a modular approach, it's entirely flexible, really works. and then you go on to level six which um allows you to get chartered um and and takes you through that program of wealth management um advice compliance at at a sort of higher more technical level um and what's interesting is that if you have a young person that's joining your organization you can go from level three level four level to level six and actually if they're under 25 the whole thing is fully funded so it really is amazing um but but other people they also really work for existing employees i mean we have had so many firms contact us who've got an administrator in their business who's fantastic but you know would like to go to the next stage but doesn't just want to take some qualifications and suddenly being thrown out there um actually the two-year program where you slowly develop the behaviors and skills and a bit of business development right because that's really important.

5:10They're coming out then as a fully trained financial advisor, but they've also given your business the time to grow and develop with them as they are growing into a business. Yeah, I mean, and this is one of the key things, isn't it, is that kind of growing in the business, being shaped by the kind of advisors or business owners, I guess, of the advice business. um i mean and i guess some some say that this is one of the um benefits of apprenticeships over traditional kind of you know study study routes and any other kind of um benefits yeah i mean i was just picking up on that one you know as a business owner as an entrepreneur in this particularly in this space right because it's so client focused and consumer duty is back that has made the client fully centre.

5:59Now, so everyone has their own cultures, their own behaviours, their own levels of standard that they expect someone to adhere to and they want to deliver. An apprenticeship means that actually it gives you a deliberate talent solution that enables you to make sure that they're going to hit your behaviours and meet your standards. So that is one amazing benefit. Obviously, the funding is a particular benefit, but there's lots of other things that sit inside that. One thing, for example, LIBF, we are doing cohorts. So they'll be in groups of 10 and 12 rather than rolling starts. That enables them to start learning from their other peers.

6:44If you've got a slightly bigger firm, then that also, or some of the networks that we're working with, they will have cohorts. So some of the learning and some of the portfolio work will be aligned to those businesses. We have the benefit of actually mitigating risk because actually an apprentice comes on on an apprenticeship contract, which is slightly different. So a business can take on a young person as part of their, an integral part of their growth strategy. And if after a year or when they've completed the apprentice, so I said a year because that's the level three, but maybe, you know, two years if it's the level four, there is an opportunity to part ways without it being challenging because you have completed the apprentice.

7:38So it mitigates that risk. It mitigates the risk of you being the solo person, developing this individual, you know, spending time with them, because actually they have a tutor, they have a cohort, and they are on a fully-fledged programme. So some of that time is going to be taken away. So for a talent solution is outstanding, and for upskilling existing staff, there probably isn't a better programme out there. Yeah, that makes sense, because one of the issues historically has been the dropout rates. I know they're a little bit skewed because sometimes, you know, it looks like something has dropped out when actually they've just got promoted or something like this.

8:18But they are quite high. I've seen stats of like 40 % dropout rates and things like that. How can that issue be solved? That hasn't been solved already. Is that a big issue still? Yeah, so actually we have devised some of our programs where one of the qualification, part of the qualification for the level four, for example, comes at the end of the apprenticeship. So they can't actually attain their SPS or anything like that. They're not fully competent. They haven't finished that qualification piece. So that protects them from falling off the apprenticeship. retention from apprentices is phenomenally high so actually I think it was and this is not an LIBF comment this is a Sally Plan comment but I should imagine some of them were completing their level four qualification and then not completing the apprenticeship because they felt they were then ready to go on to the next stage so by moving that qualification the final part to the end of the apprenticeship means that they complete their qualification and the apprenticeship at the same time so it has protected that that final piece um the the other part is as retention is so good within apprenticeships particularly within financial planning the majority of people want to stay to then develop their own client relationships at that point so um i think it is lower for financial advice anyway but this will protect people from you know finishing and going off as it were okay is the apprenticeship route suitable for everyone every person candidate and every advice business uh no um so look i'm gonna be no because for some businesses they want people to come in and be operational as an advisor in three to four months.

10:23So if that's what your business model is looking for, then an apprenticeship wouldn't be right. But my question to that would be, do you think someone can go from zero to hero in four months? Have they learned all the softer skills? have they learned all the behaviours, the open client questions, how to identify if someone isn't just vulnerable now but might be vulnerable in two years' time because they're starting to show, I don't know, slow detrimental health or they're starting to be concerned about other aspects. So I think my challenge back to them would be, no, it doesn't fit every model now.

11:06But if they're not using an apprenticeship, have they got the right model? I think would be the question to really produce a fully holistic, well-rounded, trained, competent advisor. And for those advice businesses that are interested in offering apprenticeships, how do they select the right candidates? How do you know who's selected? Because it is a commitment. Yeah. So this is really interesting. And we've spoken to a lot of firms. And actually, I was doing a webinar with Scott Stevens from Matalay Woods and Piers last week, who has set up the FFA. And, you know, I think one of the things in a client facing role, and look, there's loads of data.

11:55There's a fantastic guy who actually delivered training to Google sales team and recruitment teams on this. But when you're in a client facing role and a client facing organisation, recruitment is difficult because every firm is different. And that circles back to what I was saying about you can you can bring an apprentice and then you can help shape them to deliver the standards you expect. So every every culture is different and the behaviours therefore are different. And therefore what you're trying to recruit is naturally different. but for for um the recruitment process i think there's two things obviously one apprenticeships are for existing staff so so that could be one route to growth if you're bringing in someone totally new then the um future financial advisor is a great organization to go through um it's low cost they're doing things you know they've got outreach on tiktok and all sorts of things like that.

12:59So in terms of getting the spread, it's there. In terms of recruiting, I think you really got to go back to what are you looking for? And what's the plan for this apprentice? Is it that they stay within the administration role at level three? Is it that they're going to go on and be a trainee advisor? One of the key things actually Scott was saying that they look for is good project management skills because actually through this process what you're looking for them to do during the level three could be lots of little projects that then build into one job role I think most businesses out there I mean certainly I was a power planner and I also did business development and I also did a few events and things so I think most people in the smaller businesses are actually managing lots and lots of projects that wouldn't necessarily sit within one particular role.

13:58So I think project management is good, organisation skills are good, demonstrating they can speak to people and clients is good. So you put all that in your job role, and then you put in something that's really important about the values of your business. And then when you interview, you measure them against those key tasks and particularly ask them for examples about how they can demonstrate that they hold those same values as you hold as a business. That's some valuable tips. When you look at the demographics of the people that apply for apprenticeships, do they differ in any way to the kind of normal candidates you'd expect?

14:39I mean, currently, actually, the biggest, the most people we're talking to at the moment are looking to upskill existing staff. It's really interesting. I think they're either looking, it's either, and it falls into two folds, really. They're either looking to upskill someone who has been in the business for a couple of years, can do the administrator role and wants to move either into power planning or financial advice. And they see this as a well-funded, well-structured route where they don't need to devise the plan. They don't want the responsibility of that development plan from end to end.

15:24We're also seeing the big cohort for new entrants seems to be coming in for October. So firms that are looking to take in those young people, I think we're anticipating there will be a couple of points in the year, which are the normal recruitment cohorts for them. And then the rest of the year is existing staff. So it's a real mix, actually. That's interesting with the in-house upskilling. Now, the advice profession does seem to have a bit of an image problem. there's been some research coming out recently that suggests young people are not considering it as a career just because of old kind of you know preconceptions of what it is of who does the job what an advisor is what they look like um to what extent does that affect the take up of apprenticeships i think the decision about apprenticeships interestingly happens um or can happen before they've determined what apprenticeship they want.

16:30Certainly my daughter is about to be 17 and she has decided she doesn't want to go to university. But that doesn't mean to say she knows what she wants to do. She just doesn't want to continue with an academic learning journey. So I think in some cases, this is this, you know, they decide that uni isn't for them or certainly not right now and so then they start to look at the apprenticeships what's interesting about apprenticeships though is the gender breakdown is sort of if you look across all apprenticeships it's sort of 50 50 um whereas we know that in financial advice it's still a very male dominated environment so hopefully apprenticeships will help balance that i think it does come back to the age-old problem that people don't know about the profession unless they know someone who is one and so it's about as hopefully as we start to develop different styles of financial advice and you know the regulator is bringing more targeted support it will become a more mainstream profession similar to choices of law or counter seat just because more people will seek advice rather than the top six percent we'll get the next 30 percent hopefully engaged and then more young people will be like oh uncle john works in financial advice or and so hopefully we'll break the mold that way there's some fantastic organizations doing schools outreach and such like um but my fear with that is unless you know someone that's in the profession you ultimately don't realize how entrepreneurial it is how you know fast moving it is how you can tailor your client back into sports stars or social media stars should you wish you know there is so much creativity in there um and you can achieve a great work-life balance should you wish so So I think some of those key messages and breaking that down is going to take a long time.

18:40Now, apprenticeships 100 % will support that because those that go on to those massive databases to look for apprenticeships are going to see more and more advice firms advertising that space. So that's fantastic because actually a lot of the graduate ones get lost amongst the big banks and the trading and all of those things that I think young people automatically think about if they're thinking about financial services. So I think apprenticeships are really going to support that sort of younger, non-uni person realise that there is another career and start to look at financial advice. And just finally, what role would you like to see apprenticeships play in advice, in the advice space and in your future?

19:35I think, look, the pathway we have created is really good because it takes a long time. Now, young people don't want to hear that and some firms won't want to hear that, right? But actually, an 18-year-old is going to struggle servicing a client who's getting divorced and got a kid or something because they haven't got enough life experience. So I think the fact that the pathway, irrespective of when you start, takes a long time is a really great thing for the finance financial advice profession because. Skills, Rome wasn't built in a day, you know, these softer skills, these behaviors, the way you talk to clients, that takes time to nurture.

20:30That takes listening to people, shadowing to people. That takes practice. So learning those open questions, knowing when to probe a bit more, looking for the small idiosyncrasies between a man and a wife in a meeting to work out if he or she has really understood what a bare trust is, you know, or why a discretionary trust would be better. So I don't know. But all of those softer things take time to nurture. So I think the real winner about the apprenticeship programme is you're not in a rush. And I think the firms that can get on board with that are going to see the most spectacular results through these programmes.

21:20Lovely. Thank you very much for coming in. Really, really good to talk to you. Great to see you. I hope our listeners have found this chat as interesting as I have. please do tune in again next time and for any more stories on advisors and apprenticeships go to ftadvisor.com