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Cornering the Market on Talent

Retail brokerage firm Scottrade emerged from the recession relatively unscathed thanks to a commitment to lean teams and internal development.

August 8, 2010
Related Topics: Mentoring, Technology, Learning and Development
Retail brokerage firm Scottrade emerged from the recession relatively unscathed thanks to a commitment to lean teams and internal development.

Scottrade is remarkably lean as brokerage firms go, with just three to five people working in each of its 450-plus branches nationwide — 3,200 employees total — and plans to reach its 500th branch this year. As such, its talent management strategy must be targeted, fast-paced and able to easily reach its widely distributed and growing workforce.

When the company was founded 30 years ago, however, it had no talent management strategy whatsoever, and this remained the case for the first 18 years of its existence.

“We started as a small company; I actually was about the fourth employee here,” said Jane Wulf, Scottrade’s chief administrative officer, who is responsible for its HR, training, branch development and national service center. “We had no training department — people would sit with someone and learn that job — and as we evolved, we had to grow a training department. It’s only about 12 years old currently.”

Wulf spoke with Talent Management magazine about how Scottrade’s approach has taken shape.

TM: Describe Scottrade’s approach to talent management.

Wulf: We are a growing organization and have had to find ways to grow our talent from within. So we have created a set of core values, one of which is individual development, and drive [that] throughout the organization so that we can grow the talent that we need as we’re growing the firm.

TM: What processes or programs have you established to improve the performance of Scottrade’s entire workforce?

Wulf: It’s continuing to grow. Today we have well-established programs that provide training at all levels of the organization. We start with on-boarding, teaching the new associates about our culture, our beliefs in development, and how they can grow and be promoted here within the organization, and then they start to learn immediately. They’re assigned classes right after they finish their on-boarding to start learning all about the industry as well as Scottrade. And their learning continues for the rest of their tenure here at the organization.

TM: Where does the process of linking performance management to the strategic objectives of Scottrade begin, and where does it go from there?

Wulf: We start with the executives and directors here at Scottrade. [They] get together once a year and set the strategic objectives for that year. We do a five-year strategy but we set specific objectives each year to reach that strategy, and after the objectives are set for the organization, every department and branch sits down and talks about what their goals will be to help us meet those objectives. Then after that, each individual sets goals in order to help the department reach their goals. So we row the boat all in the same direction so that we all have the same goals and the same desires to meet our performance for that year.

TM: How does Scottrade’s size and geographical distribution challenge its approach to talent management?

With branches with maybe three to five people in them in almost every state in the United States, trying to deliver training out to all of those people and to make sure that we have consistency in that training and that it works for everybody has been a challenge for us. We provide a variety of learning methods: We do classroom training as well as online training, webinars, simulations … We keep it as varied as possible so that we can keep our associates interested and willing to take classes and continue their progress.

TM: How does Scottrade develop organizational culture and employee attitudes to optimize workforce performance?

Wulf: We think of ourselves and our employees think of us as a family and a team-based culture, [with] everyone working together to support and grow Scottrade. We provide a lot of opportunities for people to work together on projects and believe that helps them to learn from interaction with each other. It really helps us to drive our customer experience, which is what ultimately we are trying to accomplish.

How does Scottrade use learning and development to manage talent?

We have identified our core competencies and we try to train toward those. We have an internal website called Career Resources, [where] our associates can go in and enter information. We have a lot of systems that feed it and it gives us a 360 view of our people. It has their resumes, which are kept current and up to date as they take classes and get certifications. Their goals, reviews and career planning are in this piece of software, and it’s available to their leaders to be able to help them develop and grow and see what they need along the way to move their careers along here at Scottrade.

TM: What processes or programs has Scottrade established to attract, recruit and retain top talent?

Wulf: We have a very low turnover rate here at Scottrade, [which] we attribute to developing people and promoting from within. Over half of our current executive team has been promoted from within the organization, and in our more than 450 branches, 86 percent of those branch managers were promoted from within the organization. So the ability to grow with us and to advance their careers at Scottrade has helped to keep our turnover low and attract great talent to our organization.

TM: How do you use assessments to manage Scottrade’s talent?

Wulf: We do quarterly reviews with our associates. There are several different versions of them. They’re specific to jobs and to job categories. So people are reviewed on things that are pertinent to their jobs, to competencies. For example, 20 percent of our managers’ reviews are actually based on how well they manage and develop their people. So we drive it through the management team that it is one of their major responsibilities to train and develop their people.

We use those quarterly reviews when we look at whether someone should be promoted. We use [them] as well as [employees’] university transcripts off of our LMS system to see if they’ve been developing their skills and how they have tested on some of these courses. We do a lot of surveys of our associates to find out how the training is working for them and if there are things that they need for us to add to the training that would help them. So we really listen to our people when we’re developing our programs to make them better.

Has the recent recession affected your ability to use compensation and incentive practices to help manage talent within Scottrade?

This hasn’t been good times for a lot of organizations. It’s been a time when people have cut back on training budgets and frozen salaries. We’ve been very lucky in that as we’re growing, we’ve been able to continue giving above average salary increases and have a quarterly bonus program that is tied to that review process. We also have a recognition program that is points based, and the training department uses that quite often to reward points for people who get through seasonal learning programs or major learning initiatives, or maybe they received 100 percent on a test and they’ll get rewarded for that.

TM: How do you handle succession planning at Scottrade?

We look to our succession planning program to drive the growth of our talent throughout the company. For us, it’s having that talent ready to help us run this ever-larger organization. A lot of times it’s not about being promoted to the next position as much as it is growing in your position because you’re running an ever-larger organization. And so succession planning for us has taken a little bit different approach, because it’s not just about growing those top leaders, it’s about growing our talent all the way through the organization.

TM: How do you use workforce performance data to drive future initiatives?

Wulf: We use customer data to help drive our needs. That translates into training programs that have to take our service level up a notch, and we do that across the entire organization — not just [for] our customer-facing associates, but even those that are internal at headquarters that may never talk to a customer. How they service their co-workers, peers or boss has an effect on how our customers are serviced.

TM: How have your workforce performance management activities contributed to Scottrade’s bottom line?

Wulf: The nature of our associates is to work hard. We’re a very lean organization, and so satisfying our customers is the metric that we use to know whether [we’re] successful. While this has been a tough year in our industry specifically and maybe our numbers are down a little, we’re not down as much as some of our competitors, [and] we believe that our workforce is a direct effect of that.

TM: What’s next for Scottrade in terms of talent management and workforce performance development?

Wulf: Our goal is to have the most knowledgeable workforce in our industry, and that is going to [require] a focus on learning and development. We have a strategic objective this year to grow our associates’ knowledge across the banking and brokerage industry because we are foraying into the banking industry now and we believe that it’s important for all of our people to have broad-based knowledge of our industry so that they can help to drive the productivity and the performance of the organization.

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