AFS announces business review and restructure
Australian Financial Services Group (AFS Group) has engaged Seaview Consulting to conduct a detailed strategic review of the business, with one senior role already made redundant.
AFS Group chief executive Alan Logan, who took over as head of the group in September following the departure in May of Peter Daly, said the group must find a way to evolve as the broader industry was fundamentally changing.
"The question is one of: 'are traditional licensee models in fact viable going forward?'" he said.
Assessing what the AFS Group value proposition is will form a part of that, and the business will need some form of scale to continue to be viable, he said.
That doesn't mean it is necessary to go down the full vertically integrated model to achieve that scale, but it is necessary to identify within the business what is core to the value proposition and to be very good at delivering that to advisers, Logan said.
Asked if that scale meant providing product, Logan said the group had a range of products it had looked to bring to market, but the task now was to look at exactly what they were designed to do and how they supported a differentiated offer going forward.
"So yes, we offer products, but I'm not sure they're right for the future," he said.
AFS Group head of distribution Mark Ryan will be leaving the group after the position was made redundant. Logan described the position as essentially a distribution of licensee services role, which was set up so regional managers in each state could report in to the head of distribution role. Regional managers will now report directly to Logan.
It is still too soon to say whether there will be further redundancies or if other roles will be created, he added.
The review involves looking at the business from a clean perspective and asking what are the options that make sense for the business and what are the economics that back it up, Logan said.
But Logan said that whatever those answers proved to be, the status quo was not appropriate, so there will be a new option that needs to be taken.
The review is expected to take 8-12 weeks.
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