Technology is key to the future

Talk to Kelly Power about the key drivers for advice and advice businesses over the next 5-10 years, and the one thing she is very nervous about is the growing cost of advice.

“There is an absolute need for people to access quality advice and that need will only continue to grow,” said the General Manager Product at Colonial First State. “However, the growing cost of advice could drive people away from receiving it.”

Speaking at the IMAP Adviser Roadshow in March, this was one of the key insights from Power, who pointed to the U.K. retail distribution review (RDR), which was aimed at introducing more transparency and fairness in the investment industry.

“Post RDR, almost half the advisers in the U.K. market left, but since then, more profitable businesses have emerged. While there is no doubt that the industry here needs to focus of removing conflicts of interest, we also want to avoid a mass exodus of advisers.”

Power believed technology was a solution for advisers and advice businesses to better manage their conflicts. However, Power, who was responsible for leading the BT Panorama platform project – one of the industry’s largest technology projects – said she was only too aware of the complexity of dealing with rapidly evolving technology.

“Configurable technology is the key to dealing with rapidly changing technology. You don’t always have to build everything yourself. Instead, use what’s available and configure it to your needs,” she said.

“Technology can help advisers better manage and deal with the complexity of financial planning, including compliance and managing conflicts. However, I don’t think platforms have completely cracked this formula yet.”

Power added that the industry needed to improve its efficiency. She believed that managed accounts provided that efficiency, as well as helping to deliver better outcomes for clients.

“Managed accounts allow advisers to concentrate on client engagement, rather than the money management aspect. By doing so, advisers can focus on delivering quality advice by putting the client first in everything they do for them,” she said.

Why our business models will survive

Also speaking at the IMAP Adviser Roadshow, three industry professionals – Mark Smith (Perpetual), Lisa Fuentes (Affinity Wealth) and  Laurence Poulter AFP® (Partners Wealth Group) – shared their insights on why their respective business models will survive over the coming years. They responded to the following three questions in relation to their businesses.

Q1. How have you changed the client experience?

“Ten years ago, advisers were comfortable talking to their clients about stocks. However, with the development of managed accounts, they are now able to spend more time on having different and more meaningful conversations with their clients, like lifestyle planning, estate planning and philanthropy. These types of conversations have been a real extension of our client engagement, which has added value to the overall client experience.”– Mark Smith, Group Executive, Perpetual

Q2. How are you giving advisers the space to allow them to focus on their clients?

“We recognise the need to provide our advisers with the time they require to have deeper conversations with their clients. To help them achieve this, we have set up internal systems that frees them from a lot of the back-office administration, enabling them to concentrate on their clients. We have also appointed a person internally to focus on delivering greater efficiencies to the business.”– Lisa Fuentes, Practice Manager, Affinity Wealth

Q3. How do you attract and retain advisers to your business?

“There’s no denying that attracting new advisers and retaining existing advisers is hard. We seek to grow a lot of our talent internally, by providing them with the help and support they need. This includes training. When we hire externally, we look for people who are adaptable and share the core values of our business.”– Mark Smith, Group Executive, Perpetual

“Internally, we have developed an Associate Adviser Academy, which focuses on the soft skills that graduates don’t have. The Academy is a two year program, comprising of 1-2 sessions per month, so time wise, it’s not too demanding on individuals. This initiative has been very powerful for young graduates, who see the benefits of the program on other advisers who have completed it.” – Laurence Poulter AFP®, Practice Manager – NSW, Partners Wealth Group

“Today’s graduates are looking for defined career pathways, with defined timelines. They want purpose and vision with their career. It’s important to provide them with these defined pathways and timelines. We support our new graduates with both internal and external training, as well as a mentoring program.” – Lisa Fuentes, Practice Manager, Affinity Wealth

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