How to Respond to Changing Times

In a whirlwind of change brought about by regulators, technology and world events, the modern financial adviser has had plenty to contend with. But as leading industry consultants allude to below, those who can embrace change and adopt new ways of working will stand a better chance of thriving in future…


Building the Post 2020 Advisory Practice is Going to Demand Reinventing the Business Model

The business model for the advisory practice of the new era is here – and the advice business that can’t reinvent itself has no future at all, according to Mentor Education Group’s MD, Mark Sinclair and its Chair, Adjunct Professor – and legendary adviser – Jim Taggart…


Although it’s difficult to predict what the future holds for the financial advisory sector post 2020 there is one certainty and that is anything that doesn’t create value for the client has no room inside the business.

The business model for the advisory practice of the new era is in the making today – and the advice business that can’t reinvent itself to accommodate this has no future at all.

For all the upheaval associated with the Royal Commission, FASEA and new academic requirements – history has repeatedly demonstrated that where there is change, there is opportunity. But regrettably far too many advisers are drowning in negativity and uncertainty as they search in vain to maintain relevance for irrelevant business models.

Let’s start from the beginning with the current ‘old world’ premise that a good practice can only accommodate 200 clients charging between $5,000 and $10,000 annually for its service offering.

This notion completely fails to appreciate that business wealth, value and goodwill is in the relationships of the enterprise. The SoAs, investment strategy, risk insurance, etc are just the tangible outputs of the advice process – activities that can and should be continuously streamlined through automation, outsourcing and technology to be made more cost effective for the client.

No-one can argue that technology has impacted the provision of financial advice in positive ways by simplifying processes, workflows and exchange of information. Yet instead of using this advantage to increase the mobility of the adviser to spend this time improving relationships – the opposite has occurred.

Advisers have used compliance to deflect criticism and for becoming isolated inside their 200 client / $5,000 pa service fee silos and in doing so, have lost their face-to-face interpersonal and entrepreneurial advantages.

Time and again the warnings have been made about downward pressure on fees and margins that is only going to intensify in the coming years and these current models are simply unsustainable and doomed in the new era of advice professionalism.

Dr Mark Sinclair, founder and Managing Director of Mentor Education, added that giving clients what they want, when they want it, will seem like an impossibility.

But as new technologies have come to market, they’ve made it easier for practices to provide this high level of compliant service as well as increasing the number of channels through which to interact with clients and generate more revenue for the advice business. Such technologies include:

  • Customer Relationship Management journey management tools to automate and personalise client messages, via the client’s preferred medium, be it email, SMS or social media
  • Video conferencing, coupled with secure remote digital signatures, integrated with everyday office applications, enabling advisers to increase the number of quality, meaningful and efficient client interactions
  • Data management and analytics that can integrate with reporting dashboards to keep advisers abreast of how their key performance indicators are tracking and alert them to areas needing attention
  • Workflow automation tools to streamline internal processes to improve efficiency and reduce the variable client service delivery costs
  • App development tools that convert internal spreadsheets into lead generation tools, self-service client calculators or advice tools used in video or face-to-face client meetings
  • Newsletter generation applications that allow advisers to drag and drop up-to-date, relevant articles into a customisable templates, with different versions emailed to appropriate client segments
  • Data capture tools, such as mini fact-find and risk needs analysis calculators, to review and manage client information immediately during client meetings using interactive web forms

Advice businesses should be leveraging today’s trends in technology, communication and outsourcing to create compliant service offerings and interpersonal frameworks that clients will willing purchase and refer to their business associates, friends and family post 2020.

While the benefits of technology can’t be disputed, it’s important to recognise that human beings are built for personal relationships and that the benefits of such connections can’t be duplicated any other way but in person.

It’s alarming how many advisers currently miss opportunities for better financial, lifestyle protection and retirement outcomes for clients due to their lack of face-to-face activities with clients.

The bulk of an adviser’s time should be in front of their clients as personal interaction builds loyalty – and the more loyal the clients, the more likely they are to refer the practice to friends, family and business associates. These referrals are far more cost effective to the business and reflect the power of the business brand and personal reputation of the adviser.

For the ideal example of the structure a ‘new world’ professional adviser should aspire to beyond 2020 to optimise/maximise client facing time, look no further than the Barrister (financial adviser) in Chambers that receives a brief prepared by a Solicitor (paraplanner) – or highly regarded medical specialist that is able to maximise time with the patient (client) via a support structure that presents the case file with sufficient information for informed action, make a diagnosis, undertake the procedure and follow up advice

There’s no doubt that building the advice business of the future will be tough. Business-building has never been an easy task and while some advisers are going to let the future slip from their grasp, others see it coming and are responding.


The Fourth Industrial Revolution: Skills Required for the Adviser 4.0

This article challenges you to think about the future and about your place in it – as an adviser – and as an advice business, in what Mentor Education’s Dr Mark Sinclair refers to as the fourth industrial revolution…

If you have decided to stick it out in this current regulatory environment, rapidly moving from de-regulation to over-regulation, then you have decided to tread your own path and separate from the disenfranchised herd stampeding to the exit.

What you will need, not just to succeed, but to thrive, is endless resilience, a relentless client-focus and a commitment to transform into an Adviser 4.0.

To understand the mindset and skills you will require in the changing world of work and to remain competitive and relevant to a changing client base, we need to respond to the broader context of change which has been accelerating at a furious pace in the last five years.

The Fourth Industrial Revolution (4IR/Industry 4.0) is in full swing. There are now many emerging technology breakthroughs that we need to take an over-arching view of to appreciate the full extent of the transformation in progress, including robotics, artificial intelligence, nanotechnology, quantum computing, biotechnology, the Internet of Things, the Industrial Internet of Things, digital ledger technology (blockchain), fifth-generation wireless technologies (5G), additive manufacturing/3D printing and fully autonomous vehicles.

To thrive in today’s Industry 4.0, you need to become an Adviser 4.0. This will involve transforming into a digital advice practice, improving client centric processes, client experience and most importantly client outcomes by embracing new digital tools which are relatively accessible, easy to learn and cost effective.

The first step in your journey to becoming an Adviser 4.0 is to upgrade your customer relationship management (CRM) system. You will need to choose a best-of-breed CRM that will keep up with the accelerating rate-of-change that is before us. It will need to embody artificial intelligence, workflow management, machine learning, API integration to centralise all information and personalised (automatic) client interactions.

SalesForce should be a consideration, but it can be expensive and take a long time to setup. If you are a smaller practice, you might consider Practifi, an enterprising company based in Sydney that has set up a customised Adviser Practice specific instance of SalesForce that can be up and running relatively quickly at a fraction of the cost.

There are a number of applications that you will find beneficial and potentially provide a significant return on investment. For example, a 5 to 10 percent improvement in lead conversion can be achieved by creating personalised email, SMS, mail and telephone journeys, recognising demographic profiling, referral and marketing source, and using the client’s preferred communications channel, be it mobile phone, email, WeChat etc.

Other workflows you might also consider using your CRM to improve are in the areas of policy renewal, client engagement, client retention, client testimonials and client referral.

In your personal transformation to an Adviser 4.0, you might also consider an application such as SuiteBox, which combines faster internet speeds, video conferencing and compliance applications to enable you to do real time signing of documents during online meetings.

Life-long learning will also be the hallmark of an Adviser 4.0, to recognise the opportunities presented by emerging technologies, implement and fully realise the potential benefits and build the culture within your practice so that everyone comes along with you on your transformational journey.

Let me conclude by citing McKinsey’s March 2019 Report – Digital Australia: Seizing the opportunity from the Fourth Industrial Revolution – which draws on the result of a research collaboration with the Australian Federal Department of Communications and the Arts, how Australia can benefit most (both economically and socially) from what the World Economic Forum has called the Fourth Industrial Revolution.

McKinsey’s four main recommendations of significant relevance to Advisers 4.0, are:

  • Set a strategic ambition and do not be held back by the ‘curse of incumbency’
  • Underpin the digital journey with digital capabilities, while focussing on ROI
  • Pay close attention to culture
  • Build a digital organisation with digital leadership and talent

Mentor Education, which has qualified more than 20,000 advisers since 2003, has a strong focus on developing industry 4.0 skills, which it embeds into its traditional Financial Services qualifications, for Financial Planning, Paraplanning, Accounting, Mortgage Broking and Real Estate professionals.

However, Mentor also offers Business, IT and Project Management qualifications as well as CPD to develop foundation knowledge for the Adviser 4.0.

As the only registered training organisation in Australia to deliver the Advanced Diploma in Applied Blockchain, Mentor is responding to emerging technologies and the need for future focussed business analysis.

Financial Services automation is one of the biggest transformation opportunities of our time, and a number of entrepreneurs, including advisers, were in the 2019 semester-one intake to develop their business process modelling, business case development and technology skills.

Issued by Mentor Education RTO 21683:


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