Tim Sargisson: Towards profitable, proficient, future-proofed businesses
There is a real need to recognise the successful adviser of today – and increasingly the future – must be able to combine empathy with tech-savviness, writes Tim Sargisson
I enjoyed reading Simon Rogerson’s recent article for Professional Adviser, Three ways to start preparing for the future now. I have a lot of time for Simon and his team at Octopus Investments – their obsession with always delivering something better and to keep doing the simple things well.
The same week Simon’s article was published, Sandringham was hosting its first National Conference. The event was organised as part of our mission to support advisers to build profitable, proficient, future-proofed businesses, linked to a business model that aims to make money by delivering great client outcomes.
Simon’s article read particularly well for me because two of the three themes he highlighted were two of the areas I was addressing in my own presentation to 100 of our partners, who attended our event.
Hear Tim Sargisson speak at PA 360 North on 17 October
His piece referred to how technology would revolutionise many areas of financial planning and be at the heart of change – how it can be used to enhance the client relationship and reduce friction. This is so true and where to be able to survive, evolve and flourish is not about being the strongest or the fittest, it is about being the most adaptable.
Being adaptable is about having an open mind and a relentless focus on the changing needs and habits of the client, with a clear focus and a clear client value proposition. Value is about creating something tangible that clients recognise and appreciate – for example, using a robust and repeatable process to ensure a client does not run out of money during their retirement, especially where the individual takes greater responsibility for managing their income in retirement.
The use of technology is critical, however – not simply to remove friction but because the expectations of the client are being raised due to their interaction with so many other digital touchpoints in their lives. All are having a profound influence on how clients think and interact and, as a result, our clients are becoming much more demanding.
Technology becomes ever more critical, to our business because, if we fail to keep up, then we will be dumped. I have just read that Amazon is poised to become the world’s biggest distributor of insurance products, putting it in direct competition with brokers and advisers. This is the warning from insurance and technology specialists, in response to news that ‘big tech’ companies such as Amazon and Google are building up their presence in the retail insurance market.
Capgemini, for example, believes Amazon is well-positioned to enter the insurance market, where there is a lot of room for continued innovation and we are already seeing the erosion of the traditional broker market.
Amazon has an existing captive market as well as relationships with millions and millions of customers, who interact daily with the platform. In other words, the bar is being raised and what is currently viewed as exceptional will become the norm. As such we need to respond.
Fellow humans
Simon also referred to the fact that the one thing technology will not do is replace the most important things a client looks for in an adviser: a fellow human being they get on with. Clients employ an adviser because they want to talk to someone they know and trust. Technology cannot make people do something they are not comfortable doing.
This is significant because here you have the CEO of a technology-focused business talking about the importance of the adviser in the advice process – and he is correct to do so. We read about the threat from robo-advice, whose principal allure is its ability to streamline – to remove friction from the advice process and with it costs.
Robo-advice firms will continue to lose money for their investors, however. All that IT is expensive and these firms lack distribution. Providing financial solutions for clients is lumpy and there is very little in the way of a ‘one size fits all’ solution at the higher end of the market where we all want to position our businesses. Robo-advice is too superficial and lacks the network of professional advisers to engage with consumers. Computers cannot do the ‘deep-dive’ to engage with consumers in a meaningful way.
The biggest threat to advisers then might not be robots but intelligent software agents that can understand our questions and speak to us, integrating seamlessly with all the other programmes used at home and at work – ‘Alexa, how should I plan for my retirement …? There is a real need to recognise that the successful adviser of today – and increasingly the future – must be able to combine empathy with tech-savviness.
Tim will be one of more than 30 expert speakers at the inaugural PA360 North adviser conference, which takes place at The Park Royal Hotel in Warrington on 17 October. View the full programme or register for your free place here
Published on 25th September 2018
