DCIO HIRING TRENDS – The Rise of the Relationship Manager
In the early years of DCIO distribution, asset managers relied on their intermediary national account professionals to gain access and approval for their DCIO strategies with wirehouse and independent platforms. They also leveraged their institutional consultant relations teams to cover large market investment consulting firms, some of which were in the nascent stages of creating a defined contribution consulting practice—including manager research and selection for custom, open-architecture target date funds.
Looking at the typical DCIO organization structure today, we notice that the largest asset managers have carved out, or hired, dedicated DCIO national accounts professionals to manage relationships with the largest national wealth management platforms. Additionally, over the last five years, firms created DC-specific consultant relations roles, often reporting to the institutional consultant relations team, to drive flows through DC consulting practices and/or delegated investment teams within the largest institutional investment consultants.
More recently, prescient DCIO distribution leaders, recognizing the growing influence and importance of retirement-focused RIAs and mid-tier investment consulting firms like CAPTRUST, SageView, Lockton, NFP, Gallagher and others (the so-called “Aggregators”), have created DCIO Relationship Manager positions to cover these firms. They’ve also dedicated resources to cover DC recordkeeping and retirement sub-advisory relationships.
Interestingly, the Relationship Manager title is fairly misleading as the role combines the responsibilities of sales, consultant relations and client portfolio managers/investment strategists. Firms looking to hire for Relationship Manager positions need to assess a candidate’s:
history of successfully gathering and retaining assets across market cycles
quality and breadth of relationships and their ability to create them
investment acumen and credibility
creativity in identifying ways to utilize the firm’s strategies in multiple investment solutions
Beyond the role of a traditional wirehouse or independent broker-dealer national/key accounts professional, these new Relationship Managers are tasked with driving assets through model portfolios and inclusion in open architecture target-date funds, among other DC investment solutions. The requirements of the role combine experience and talents of multiple positions which often do not reside in any one professional.
Seitz Partners expects to see DCIO Relationship Management and DC Consultant Relations hiring to increase over the next year and several DCIO leaders noted that they’ve already budgeted for, and are committed to adding, these positions to their DCIO teams in early 2018.
As more emphasis is placed on the importance and influence of home office, investment consultant and aggregator relationships, what impact, if any, will that have on the external sales team?
What do you think? If you are interested in commenting or learning more, we would love to hear from you at firstname.lastname@example.org.
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