Edward Jones: Can't Nobody Hold Me Down

Dec 1, 2007 12:00 PM, Halah Touryalai

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Edward Jones at a Glance

Total client assets: $539 billion

Number of advisors: 10,136

Average annualized revenue per advisor: $291,229

Pretax profit margin: 11.39%

Motto: ”Making Sense of Investing”

Best Management move: (Finally) Developing a fee-based advisory account

Biggest weakness: Technology

Well, they've done it again. Edward Jones is the happiest place on earth — or somewhere close to it. For the 15th consecutive year, the firm is at the top of the heap in this year's Broker Report Card Survey. Its impressive 9.5 overall score is just a notch up from last year's 9.4, and the runner up, A.G. Edwards, is nearly a full point behind. Things, as usual, are just fine for Jones reps.

And, as usual, the biggest advocates for the firm are the reps themselves. “Edward Jones is an outstanding firm to work for. I am a limited partner, and extremely proud to run an ethical and profitable business under the increasingly recognized brand of Edward Jones. I will retire here,” says one Jones rep.

The 9.7 score the firm received for overall management is perhaps the most notable, since it pummels the 8.4 average for all firms. Apparently, Jones reps can find little to complain about in CEO Jim Weddle's handling of the firm. One rep says he has “a high degree of confidence in our new managing partner Jim Weddle, and the direction [in which] he is leading our firm. Jim has asked both our customers and our associates what we do well, and what we can improve upon.”

Indeed, Weddle says communication is one of the things the firm excels at, and that this strength helps to produce the positive climate. On a quarterly basis, Weddle and his 16-member management committee hold day-long meetings with groups of 10 to 12 financial advisors and branch-office managers. “We ask them, ‘What can we do to help you in the branch? What tools and information do you need? Is there a different process or approach to part of the business that would benefit you to make you more effective?’ We come back with some great ideas,” he says.

Management doesn't only ask for feedback regarding the day-to-day stuff: Weddle has also been reaching out to the home office, advisors and branch office managers for feedback on the core values of the firm. It helps Jones reps to feel that they have some say in the strategic focus of the firm. Weddle says he's in the midst of developing a five-year plan for the firm that will be complete by the end of 2007. “When we sent out that request for help, we had 2,000 responses in 24 hours. I'm not kidding. We had 4,800 responses total. People appreciated being asked. It was gratifying to see,” he adds.

Another move that's making reps happy (and is perhaps long overdue) is the development of a fee-based advisory account. The firm has been talking about it since the beginning of this year, but has yet to roll it out. “I think the advisors are pretty excited about that coming next year,” Weddle says.

But the firm's Achilles heel has been — and continues to be — its technology offering. Reps gave the technology/advisor workstation category the firm's lowest scores. “I like where I am, and the freedom to run my business my way. However, there are many constant frustrations that Edward Jones needs to address,” says one advisor. One of the things the rep points to is the firm's “terrible back office support and systems.” It should be noted that the firm has invested about $200 million to upgrade its technology, but it may take more than that to drag them out of the dark ages. After all, Jones reps have only had companywide email access for about a year.