Wealth management isn’t what it was ten years ago.
The introduction of robo-advisors and the growing use of online banking have clients expecting their financial planning to be done conveniently and digitally. On top of this, since 2008, firms have been inundated with new regulations and fee structures that are confusing Advisors. Between compliance procedures and client expectations, Advisors are feeling restless and calling for their firms to help them navigate Wealth Management in its current state.
But, it’s not exactly the best time for Advisors to feel restless. The economy is in a downturn, a significant number of Advisors are reaching retirement, and technological innovations are not only giving clients surging expectations, but they’re also making it easier for your Advisors to go independent. It’s a more crucial time than ever to foster the loyalty of your Advisors. Here are 5 tangible ways you can serve your Advisors to improve their overall experience.
Help them figure out complex regulations
While the constant evolution of industry standards may be a good thing for the consumer, complex fee structures and compliance procedures often leave Advisors in the dark.
Imposed regulations are a headache for Advisors internationally. In recent years, the United States (with the DOL’s fiduciary rule), Canada (with CRM2) and the European Union (with MiFID II) have all introduced complex policies which have set out to, among other things, make client – Advisor relations more transparent. However, they seem to have done the opposite. In Canada, CRM2 requires Advisors to regularly disclose fees and commissions as well as investment performance to their clients. While this provides clients with more information on their portfolio, it’s leaving Advisors as confused as ever. J.D. Power polled Canadian investors on their knowledge of the fee structures at their firm. Here are some of their findings:
- 75 % of Canadian investors admit to not understanding the commissions and fees they pay their firms.
- 45% of Canadian investors claim that their firm hasn’t provided them with a summary explaining the fees.
- 43% have not received an explanation of the firm’s fee structure.
- 33% have not received a comparison of their investment performance to the broader markets.
A simple way to improve the Wealth Advisor experience? Don’t leave your Advisors to figure out fee structures and compliance procedures on their own. Take initiative as a firm to arm your advisors with uniform compliance standards and documentation. Better yet, give them digital tools that will help them easily and efficiently produce the necessary reports for compliance. But, more on digital tools later.
Give them less administration and more face time
Isn’t that what it’s all about? You run a financial firm that thrives off your Advisors sitting down with their clients and mapping out a financial plan that fits their complex lives. Therefore, you need to free up your Advisors to do just that.
A simple solution is paperless onboarding. The paperwork that comes with client onboarding can seem endless and takes up a lot of Advisor time. By introducing paperless onboarding, you can shift the administration process from front office to back office and free up your Advisors for more face time with their clients. A 2015 report from Accenture states, “There is a strong business case for transforming client onboarding, not only to keep pace with competitors, but also to generate significant value through revenue growth and cost savings.” On top of creating revenue and cutting costs, paperless onboarding is an easy way to give Advisors more opportunities to sit down with their clients.
Not sure about all the details that come with paperless onboarding? Download our free Mini Guide to Paperless Onboarding in Wealth for a good primer.
Give them a digital toolkit.
The lack of desire for many firms to keep up with the digital climate has caused their Advisors to move on. Advisors who believe technology based platforms, such as robo-advisors, are a major client incentive, will gladly move to a firm that provides a full digital toolkit for their clients and themselves to work with.
A study of 652 Advisors from Canada and the USA, revealed that 46% believe firms are not providing enough digital support and 41% say clients are requesting digital tools that their firms don’t offer. The most common of which is online financial planning. Advisors and clients alike want the ability to monitor portfolios, work on asset accumulation, and perform goals-based investing from their computer at home or on their mobile device.
Here are a few other ways that Advisors want their technology to work for them.
- Using CRM to provide clients with a holistic, “360-degree” view of their assets.
- The ability to create custom client lists to better deliver targeted, relevant communications.
- Rationalizing alerts received by Advisors and improving the Advisor desktop user experience.
- Enhancing mobile applications to gain a first-mover advantage.
Having one or two digital tools is not enough. Advisors want a full digital toolkit.
It’s also important to note the significance of a strong mobile platform. Utilizing mobile platforms means creating capacity for more business. Financial Planning lays out “16 Ways Advisors Are Using iPads to Improve Their Business,” which is a helpful start, but the reality is that clients expect to use their mobile devices for everything from onboarding to portfolio managment, and your Advisors need the ability to offer that.
Technology can be an amazing and much needed tool to satisfy your Advisor and client expectations. But, will the Advisor know how to use it?
That’s where training comes in.
By itself, access to a digital toolkit is not enough. Advisors need to be able to use that toolkit to the best of their ability. A 2012 study from Ernst and Young states, “Less than a third of wealth management firms report that their client-related technology is effective—with over 20% stating it is not effective.” The role of technology is incredibly important, but it’s rendered worthless if Advisors can’t use it.
Seamless use of a digital toolkit is far too important to leave up to the Advisor’s initiative. Regular training support, paid for by the firm, is necessary if you want your digital toolkit to work for you. But, don’t stop at digital training. Training is also necessary for helping your Advisors understand compliance procedures and paperless onboarding. With any initiative you put in place to improve your Advisors’ experience, training has to be considered.
Ask them their expectations
Before you make any drastic changes, there’s one important thing you need to do: ask your Advisors what they expect. This may be the most important point of all, because it gets down to the actual needs and expectations of your firm. Maybe your Advisors feel completely comfortable with the up-to-date digital tools you’ve given them, but feel as if there’s still some confusion over fee structures. Or maybe fee structures are fine, but they really want to be freed up for more face time with their clients. You won’t know until you ask.
Since your Advisors are your employees, they’re easy to get a hold of. Try sending out an anonymous survey asking your Advisors about their expectations. There will be responses that you’ll be completely unaware of and others that you probably expected. Checking in on your Advisors won’t only show that you’re intentional about improving business, but it will also show that you care about their experience and that you’re open to improvement. Surveying your Advisor’s’ expectations is key to improving their overall experience.
The economy is in a downturn. That’s not something you can control. But, what you can control is your Advisor’s experience. While the rate at which Advisors are leaving firms continues to increase, you can notice the signs early and do what you can to retain the valuable Advisors that you already have.
Download our free eBook “How to Improve the Advisor and Client Experience” written by Agreement Express CEO Mike Gardner to learn how you can recruit, retain, and support the best advisors through systems and processes.