Consistency key to planner value
Consistency of service and a broader lifestyle focus for clients are crucial for financial planners in the current marketplace, according to Matthew Lock, managing director of financial planning consultant Customer Acquisition and Retention Management (CARM).
Speaking at the Total Asset Planning Conference in Sydney, Lock drew on his own experiences as a senior planner with ipac securities in the 1990s.
His presentation on growing value within a financial planning business dealt with two perspectives: client satisfaction; and the higher-level strategic goal of building a marketable business.
In a session on ‘Building a business you can sell’, Lock highlighted the importance of brand consistency, and the difficulty of achieving this within the traditional ‘craft-selling model’ adopted by the industry.
“Brand can only be built if you have something that differentiates it, that you can consistently deliver time and time again to the customer,” he said.
Achieving this requires the adaptation of technology and automation, which Lock described as “industrialising the process”.
He argued that there is a need for reform within the traditional business model of financial planning, with the existing craft-selling model making it almost impossible to leverage the full value of what planners do.
Speaking about the fundamentals of financial planning, Lock contrasted his ‘lifestyle planning’ model with the more traditional approach.
In this lifestyle model, product outcomes are replaced by lifestyle outcomes and cashflow management supersedes risk management.
Lock also said that while many planners offer only an ad-hoc relationship, an ongoing, continuous relationship is required, and that planners must view returns and tax benefits as inputs within the process rather than focal points.
Recommended for you
ASIC has launched court proceedings against the responsible entity of three managed investment schemes with around 600 retail investors.
There is a gap in the market for Australian advisers to help individuals with succession planning as the country has been noted by Capital Group for being overly “hands off” around inheritances.
ASIC has cancelled the AFSL of an advice firm associated with Shield and First Guardian collapses, and permanently banned its responsible manager.
Having peaked at more than 40 per cent growth since the first M&A bid, Insignia Financial shares have returned to earth six months later as the company awaits a final decision from CC Capital.
