where to begin?
There are a lot of internal issues here that have been neglected by management for a long time, which has only made things worse, although, the issues are now being addressed but with lack of urgency, transparency and regard.
- No incentive for young employees to perform well, and no way to retain the young employees that do perform well (and meet expectations)
With high billable goals that are typically viewed as unattainable (I barely hit mine working 10-hour days on average, with plenty of 15 hour days during busy season, taking 3-4 days off all year while working plenty of weekends, and exceeded the billable goal by only 100 hours) you better be able to reward the employees that are able meet the goals.
However, despite a clear work load disparity at the analyst level, there is no clear disparity and distinction in analyst's bonuses and salary increases. For example:
Analyst A: who worked 2000 hours and produced high quality work product will receive X% + 3% of base salary and Y% + 2% in annual salary increase at fiscal year end
Analyst B: who worked 1600 hours and produced so-so work product will receive X% of base salary and Y% in annual salary increase at fiscal year end
Ultimately, hours worked over the billable goal at the analyst position typically equates to a minimum wage hourly rate or less, so there is no fiscal incentive to outperform goals, however there is every expectation that you will work late and that you're just as vested in the work product as the consultant delivering the work to client
Really the only tangible reward for good work is more work.
- Top Heavy
This probably is strongly related to the analyst bonus issue (as well as unrealistic growth expectations of senior management); with so many tenured associates at the consultant and senior consultant level (who take home much more at year-end in bonuses then junior associates) there is no money in the bonus pool to go to junior associates, as well as bottlenecking top-performing junior associates from transitioning into a consultant role
Also, none of the consultants and senior consultants who are either incompetent or 'nightmares' to deal with are handled appropriately (fired). Instead they are allowed to 'hang around' as long as they would like and continue to drive down office morale.
It's assumed that the 'problem' consultants will just get the idea and eventually move on based off of low bonuses on an annual basis (this assumes some disparity in the bonuses at the consultant level), however all these 'problem's are vested in rich legacy pension plans and are an older population, so, if they have any financial sense (they all do), they all are perfectly incentivised to stick around until retirement while their rich pensions continue to accrue.
- Lack of Transparency
If anything is being done to address the 'above-average' turnover it is not being communicated to the office or specific practice.This of course is assuming that high turnover is being addressed, since in the last year and a half over 20 analysts have quit in my particular practice (with more than half being knowledgeable, tenured senior analysts).
Although, senior management is quick to rationalize high turnover as 'coming with the territory' of being in the financial service industry.
its worth nothing that there are, roughly every two years, employee engagement surveys so that management can better address issues within your practice, office and company-wide. However, in my practice, the results of the engagement survey have yet to be acknowledged or discussed in a practice-wide meeting (what you would think would happen after engagement survey results have been released, but here we are more than 4 months later...).
Bonus structures are not discussed with younger employees so there is no understanding of how bonuses are awarded and under what circumstances they are awarded
Promotions and, more importantly, employee development are not discussed with junior associates unless they reach out to their manager to try to understand how they can be promoted.
- Lack of communication
this may come with the territory of working with actuaries, but, generally, everything is done on unspoken expectations i.e. a consultant will give a tenured analyst some admin type work (filing or making edits to some documents) and tell them to do it, but will expect the analyst to pass off the work to a more junior analyst or administrative assistant, but nothing will be said of that nature. It is worth noting that occasionally you'll have a consultant who actually expects the tenured analyst to do the admin type work and will get upset if you pass that work off (even if your busy and the admin type work is urgent)
- No work-life balance
IF you're motivated to get promoted or exceed goals(although no guarantee that you will be able to get promoted through hard work and dedication)
- High turnover and understaffing
No end in sight to this issue (as previously alluded to)
- Complete disconnect between senior management and junior associates
senior management doesn't understand that you need competent young associates to be able to retain key clients and grow client relations. Inconsistent work product, missed deadlines, and client dissatisfaction is what will continue and grow more apparent as turnover escalates.
Senior management does know they will need less competent young associates in the future as they attempt to become a leaner more cost efficient company. less analysts, more outsourced work, more admins, is all part of the game plan, but who's going to replace the consultants to ensure client relationships are maintained? Oh, well the retirement practice is going to evaporate in 5 years anyways so what the difference. At least that is what is assumed by senior management, although they'll tell junior associates that pensions are making a comeback and the company can continue to grow at faster pace than currently, even though their largest revenue generator is in a declining field with spikes in revenue over the next few years only coming from plan termination projects (that will generate a lot of revenue now, but in 2 years there will be no revenue)
- Benefits are below average in comparison to industry
- pay is below average in comparison to industry
and bonuses are non-existent (as previously mentioned)
Also, actuarial exam bonuses are roughly half of what Aon and Mercer offer
