Prepared by Charles Smith, MLC Business Growth Manager, NSW
Advisers are demanding an innovative, tech-savvy licensee that can help them grow their practice through strategic alliances and professional development.
We asked Australian advisers to rate the most important services they look for in a licensee. Their feedback reveals the changing nature of the profession and a growing need for specific services that will support their business.
The findings of the Financial advice of the future report
A research initiative conducted by Momentum Intelligence on behalf of MLC Licensee Network, reveal that referral relationships, business coaching and technology are three items advisers are looking for in a dealer group.
The research found that growing practices place greater significance on strategic alliances, while those in mature businesses place greater importance on the regulatory and compliance support their AFSL holder can provide.
A strong emphasis placed on strategic alliances and referrals
We live in an age of convenience. Time-poor Australians have become accustomed to the rapid service delivery of digital devices and apps and are looking for the same experience in their financial lives. Advisers are well aware of this trend and are looking to partner with mortgage brokers and accountants to deliver a better, more convenient experience for their clients.
The delivery of holistic advice is on the rise. Our research found that more than half (54 per cent) of advisers will be creating referral partnerships and strategic alliances to grow their business, with 80 per cent of them selecting accountants as their profession of choice.
With such a strong emphasis on referral relationships, there is a burgeoning opportunity for licensees to facilitate these relationships and ensure advisers have the flexibility with their licensee to support innovative partnerships. There is also scope for licensees to grow their business and services offering through referral partnerships with accountants and other strategic partners.
Business coaching across all levels in the organisation
While licensees are generally proficient at providing professional development and training to practice principals, not enough thought has been given to the other employees in the business. Licensees that provide business coaching and training initiatives for paraplanners, support staff and associates will resonate with the advice businesses of the future.
Tomorrow’s licensee networks will also need to help practices mitigate the risk of losing industry knowledge and expertise. Only 6.5 per cent of advisers are developing internships and 11.6 per cent are establishing mentor programs.
Even more worrying is the 40.6 per cent of advisers who have no programs or strategies in place to manage the risk of losing industry knowledge.
Licensees that can help practices implement these programs and strategies, will not only help their advisers but extend the longevity and quality of the profession.
Technology is only useful if it solves a problem
A key issue for advisers in the current environment is the rising cost of servicing clients. As practices transition to a fee for advice model there is a significant risk that mass market clients will be unable to afford advice.
Technology can provide a powerful solution for these clients. Innovative licensees that can harness new technology to help advisers reduce the cost of servicing their clients will be in high demand.
Over half (57.4 per cent) of advisers are currently investing in technological efficiencies to maintain their profitability. Going forward, licensees can play a much bigger role in helping practices integrate these solutions and reducing the cost of purchasing new technology systems.
Advisers have spoken: the services they require to support a growing, successful wealth management business are clear. Licensee networks that can facilitate referral relationships, provide expert business coaching and offer innovative solutions will be in high demand in years to come.
Want to find out more about how MLC Licensee Network can support you and your business? Email me on [email protected] or leave your details her for a call back.
