Although it may sound counterintuitive, advisers and business owners are the biggest root causes of inefficiency, a panel has heard.
Encore Advisory chief executive officer Mark Zaglas said during The Advice Assembly webinar on Thursday morning businesses are finding that each adviser has their own subtle differences in the way they work which results in the process becoming convoluted and therefore inefficient.
“[If] you have five advisers, typically you’ve probably got about 15 variations of your process running through the business”, Zaglas said.
The other root cause is “decision making at the owner table”. Errors made at the top level of the business such as ineffective resourcing can lead to inefficiencies in the process.
Zaglas said that “having honest conversations in those two spaces will generally start to solve 80 per cent of your efficiency problem”.
He put forward two solutions to improve efficiency for businesses. He declared that firms need to “get crystal clear on the ideal client”.
He suggested to “[use] the name of an actual client in your database that is real and known to everyone who if you had more of them, you’d be delighted”.
“Turn that then into a case study. You now have an internal document to train staff on and you have an external document to market on.”
The second solution was to simply “get on a whiteboard and write down the process” for the team to identify the areas to fix.
“You can fix so much of your efficiency just by that then look at technology and outsourcing as enablers, not solutions,” Zaglas said.
Elsewhere during the webinar, Finura Group managing director Peter Worn said another way to improve business efficiency was simplifying the usage of technologies.
“A lot of work we do with big and small organisations in wealth is simplify technology,” Worn says.
“We often find that people, rather than trying to explore what they’ve got, have been tempted to add something new to solve that job than actually understand the capability. We remove more stuff than we add in most projects we do.”
He suggested that firms should keep the number of AI tools they use at “two primary systems”.
“One will be your specific tool for doing financial advice type jobs,” Worn said.
“The other tool will be a productivity platform which frankly is Microsoft for 90 per cent of users.”
Microsoft director of financial services industry Rebecca Engel echoed the sentiment, stating that “the number one thing is to simplify your architecture”.
“When your digital layer gets larger, that increases your risk of a security issue,” Engel said.
By keeping technology easy to use and understand, businesses can help prevent accidental human error causing security breaches.
At the Professional Planner Licensee Summit last month, Alchemy Cyberdefence chief executive Indi Siriniwasa said most firms were using too much software and it was exacerbating cyber risk.
Although Worn expressed concern over the dangers of AI usage, he put forward two potential benefits, one being content generation.
Worn praised AI as a huge help for “small businesses [who] struggle to come up with ideas and marketing to clients”.
Furthermore, he said there is an “inclusion aspect” to AI, such as the GPT tools which can help facilitate communication with a different audience.
“I think there’s a really interesting diversity inclusion aspect to this where you can potentially use some AI to help you communicate to customers in a way that they’d like to be communicated with,” Worn said.
The primary cause of inefficiency and difficulty is the licensee, not the adviser. I guess you create that talking point if you are trying to drum up business with principals.
Also, this whole “ideal client” non-sense that has been spruiked for 30 years, is obviously still going strong. It’s what’s called a “luxury belief” of the “top advisers” that can get away with looking after 30 clients while making $500,000 plus. These “elite” can sit back and wait for the “ideal” client number 31 who has the right amount of money and job title for them to bother getting out of bed.
But for everyone else, trying to make a living in a small regional town, you will do business, and you will help EVERYBODY, otherwise you will quickly be known as the pariah that was too expensive or too up herself to help uncle John.
My advice to all advisers listening to this drivel, is that beware of luxury beliefs, they are always sourced from an ivory tower disconnected from reality and are always destructive to the common man.
And lastly, AI as a “diversity” tool…really? Is there no limit to shameless virtue signalling?