Australia can view five years into the future of the advice industry simply by following the UK after its completion of the Retail Distribution Review (RDR), according to CoreData.
Parallels between the RDR and the Royal Commission had previously been made, and speaking at the Association of Financial Advisers (AFA) conference, Andrew Inwood, CoreData founder/principal, said the Australian industry should be looking at the UK businesses that had succeeded.
“Five years ahead what are they focusing on? The number one thing they’re working on is making the technology remove the work,” Inwood said.
“Their platforms often aren’t owned by tech providers or if they are, they’re fronted by industry professionals.
“Making sure those things are really powerful and drive the systems inside the business are really important.”
Inwood said even the “average” tech businesses in the UK were “streets ahead” of what was available in Australia.
“In so many businesses I sat with, they had to be transformed, which meant changing people, processes and getting new people to adhere to processes,” Inwood said.
The similarities between the Australian and UK markets was also noted by software firm Intelliflo during another panel during the conference, who cited that as a reason they could enter the Australian market.
Inwood said technology was not the only issue, as the relationship between advisers and licensees (networks, as they were known in the UK) had also improved.
“They found a way to make their network and the adviser be much more aligned in outcomes; this is a big brother/little brother relationship,” Inwood said.
“Unless the advisers are happy and getting the processes they want, the networks will never be successful.
“The advisers have to be much more mature of what they’re demanding of; we’ve seen both behaviours be pretty terrible in the past.
“Getting a joint view of the world is going to be an important part of mutually assured success.”
Finally, Inwood said the UK was doing a “powerful” job of anchoring the value that was created.
“We fumble this away routinely as an industry; the advisers I know that I work with are creating extraordinary value for their clients but we routinely don’t talk about it,” Inwood said.
“We have to find a way to remind the people we are working for that every quarter we’ve added value to the process in the relationship.”