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Two challenging forces are converging on the advisory industry right now. There will be a deficit of roughly 100,000 advisors over the next decade, says McKinsey. At the same time, advances in AI technology show the promise of eliminating many of the manual, time-intensive workflows that have defined middle- and back-office work for the past 40 years.
The labor gap is creating pressure on firms to do more with their existing teams, and AI is giving those teams the tools to actually do it.
To give you an idea of the kind of transformation underway, we work with an RIA that has embraced AI. They recently set an ambitious internal target to increase the number of households served per advisor by 8%. Their historical baseline was around half that number, realized through incremental improvements on the operational side and the human talent becoming more efficient at their work.
At the end of the year, by using AI tools, they hit 22%.
Here is how firms like this achieve double-digit growth using AI, even while navigating a workforce transformation they cannot fully control.
The Back Office Role Is Getting a Promotion
The middle- and back-office role is becoming a genuine force multiplier for the business, in a way it historically was not. For the last 40 years, that role was largely predictable: getting paperwork from one place to another, correctly and on time. This is vitally important stuff. You cannot run a business without the middle and back office. But those roles came with a ceiling on impact, especially in terms of career progression.
AI removes that ceiling. When systems that were not purpose-built to integrate can now talk to each other without requiring a developer, the person managing those workflows can take on work that is more nuanced and more urgent. They can be the person figuring out how to 10x the number of accounts the firm can open in a month. They can be the one testing new tools and building the operational playbook the advisor depends on.
That changes the job description, and it changes what kind of person you are looking for in the role.
One mid-sized RIA I have been working with has started building a formal leveling guide for their centralized administrative staff. It ties directly to business outcomes: How many households is this person supporting, and how is the firm's organic growth trending? The thinking is that if the role has a real impact on the business, the career path and compensation should reflect that.
The title they landed on for the senior end of this track is chief of staff, and they mean it in the same way a technology company might — driving execution, alignment, communication, and operational leverage across the organization. They’re also deliberately hiring people who are curious and comfortable experimenting with new tools, rather than prioritizing the hyper-detail-oriented SOP executor the role used to require.
We’re starting to see career paths that didn’t exist even a few years ago. In most firms, an administrative employee's options were to eventually become an advisor or a para-planner. But not everyone wants a fully client-facing role. Now there’s a track where someone can build a career in the back office, grow their impact measurably, and be compensated accordingly. That is a meaningful change for recruiting and retention in an industry that has historically struggled to attract, keep, and — most importantly — grow operational talent.
Where to Start
At a conference I recently attended, around half the advisors I spoke with understood that AI matters but had not yet taken a first step with it. They saw what could be accomplished, but they genuinely didn’t know where to begin.
Start with one thing. You don’t have to rush in with a top-to-bottom transformation of your entire business. Use AI to draft a client newsletter, or try using a note-taker. Pick something specific, quantify the results, and if it’s truly helpful for the business, operationalize the process. Then move to the next thing.
This is how some of today’s most tech-forward firms started a few years ago. They experimented, saw results, and went from there. The workflows they’re using now aren’t the ones they built then. This technology develops rapidly, but the skills carry over. The teams that started experimenting early have developed a kind of fluency that has made each subsequent step easier.
At the same time, start thinking about how you would hire and retain the people who will help push this kind of transformation, especially in operations. I encourage RIAs to interview for curiosity and a willingness to experiment.
This industry got CRM in the 1990s and financial planning tools in the early 2000s. Since then, not much has changed at the infrastructure level until very recently. The pace is different now. The deficit of advisory talent entering the sector is actually a real opportunity for people who might not have had a clear career path here before. For the firms willing to build the infrastructure to support them, the rewards are outsized growth and profitability.
Steven Latow is the chief strategy officer at Zocks.
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Advisor Perspectives welcomes guest contributions. The views presented here do not necessarily represent those of Advisor Perspectives.