While technology plays a vital role in efficient financial advice firms, it remains just one piece of the wider puzzle, writes Business Health.
Innovative software and other technological tools are often cited as a key way to bolster efficiency levels for financial advisers, whether it be through customer relationship management (CRM) systems or statement of advice (SOA) production.
Adviser Ratings recently discovered that over seven in 10 advice practices that embrace technology are enjoying profits above 10 per cent.
Meanwhile, the annual average tech spend of advice firms sits at $37,000, according to Investment Trends, which they plan to increase by 6 per cent to $39,000. Some 37 per cent of advisers already use artificial intelligence (AI) tools to enhance practice efficiency, and a further 43 per cent of advisers display interest in adopting AI in the future.
While the value of tech integration for the advice profession is undeniable, Business Health has recognised the importance of non-tech strategies to also drive further efficiencies.
“Software plays a very important role, but it’s just one part of the efficiency puzzle. Tech, by itself, won’t propel you to the highest levels of efficiency,” writes Business Health principal Tony Stephens.
The principal put forward seven key suggestions to help advisers become more efficient without relying on tech alone.
Understand the multiplier effect
Completing a regular review process for new clients and existing clients can make crucial improvements in an often repeated activity. For example, Stephens explained, saving 10 minutes on a task during a client review can snowball into saving 2,500 minutes over the year if the business conducts 250 annual reviews.
Ensure the right people are doing the right things
To enhance both efficiency and profitability, advisers need to be focusing on high-value duties and working on the business. This means delegating and trusting support staff to complete tasks that advisers can easily do themselves.
Filter prospects before the adviser gets involved
Attracting a specific type of client means clearly articulating the ideal client base on the website and publishing a fee schedule to filter out those who cannot afford it, Stephens added.
Ensure client engagement
“If a client isn’t truly engaged, the practice might spend a lot of time preparing for a review they won’t even attend – even if the review involves making important decisions.”
Providing a meeting agenda and asking clients if they have specific issues they want to discuss will ensure the client is engaged before any preparation is undertaken by staff.
Outsource what you don’t have internally
If the advice practice lacks certain skills or functions, the principal recommends that advisers outsource through an external consultant or a part-time employee to fill the gap.
Carve out weekly priorities
“Work towards an ‘ideal’ week, month or quarter by ensuring your diary has allocated time aside to do the things you need to do, then be accountable to its implementation.”
This could include setting time aside to identify new prospects, conduct client reviews, or focus on business planning.
Decide what is important and what is urgent
Finally, Stephens encourages advisers to differentiate what tasks are important versus urgent, and to create priorities around that.
“As an example, when servicing clients, balancing the urgent with the important can be a challenge. Are ‘A’ clients more important than ‘C’ clients? Do they have different expectations? Do you have different service standards that are understood by staff and clients?
“Create reactive and proactive service standards for clients and make sure both they, and your staff, understand and deliver on them.”
