The Broker-Dealer of the Future, Pershing's first study on the broker-dealer (B-D) industry, says B-Ds must improve their operating efficiency, technology and training in order to retain advisors as the planning industry changes.

Four factors determine the new competitive landscape: the investor-driven change in the investment process, the shortage of talented advisors, the new affiliation models driven by the trend toward fee-based business and the pressures on profitability.

Today, more than 5,000 advisors are dually registered. Half of B-Ds currently allow dual registration, though 75% say it's unlikely they will continue to. They may not have a choice.

B-Ds need to step up to the plate, the study says, and offer advisors services they can't receive by switching to their own RIAs. Through enhanced technology, planning and succession assistance, the B-D of the future must create a platform that keeps hybrid advisors doing business with them.

They also must improve their training of new advisors. Advisors want to increase their knowledge in: lifetime income solutions, advanced financial planning, tax planning and estate planning. More than 42% of B-Ds don't even offer training in these areas; no training programs received top ratings.

But advisors and B-Ds have varying ideas of what's important when shopping for a B-D. Advisors ranked compensation and minimum hassle as their most important criteria, while B-Ds see their brand and culture as most important.

It's not surprising, then, that the two areas in which B-Ds exceed expectations are branding and proprietary research. However, the study says, B-Ds still must improve on: specialty planning including tax, trust and estate; RIA technology; customer relationship management (CRM) technology; customer acquisition; prospecting support and unified product technology.

The B-D of the future must also improve on its product offerings, particularly trust accounts, health insurance and discretionary portfolio management. Advisors want consolidated statements and web-based portals for customers. A paperless office is the third most important attribute advisors look for in a B-D.