The best advice practices can produce Statements of Advice faster, but the time to implement advice is the same across the board, according to data from Iress.
The advice software provider released its first annual Advisely Index report to mark the anniversary of its online community platform.
The report found that the “top 10 per cent” of practices – measured by the 10 best performers in each category surveyed – take an average of 12.2 hours to produce complex Statements of Advice and 3.4 hours to produce simple SOAs.
The top 10 per cent are more efficient at producing basic SOAs (45.2 per cent faster) than the average practice (measured by the remaining 90 per cent in each category), 47.5 per cent faster at producing complex SOAs, 59.5 per cent faster at producing strategy papers, and 57.7 per cent faster at producing review documents.
Hours to produce common advice documents
However, the margins are smaller for advice implementation with the top 10 per cent implementing basic advice 30.6 per cent faster (2.5 hours versus 3.6 hours for the average practice), and 23.4 per cent faster at implementing complex advice (5.9 hours versus 7.7 for the average).
Across the board, the average advice document production time has decreased over last three years.
The findings come as the industry awaits the second tranche of the Delivering Better Financial Outcomes legislation which is expected to replace SOAs with a simpler advice document.
Minister for Financial Services Stephen Jones has said he will introduce draft legislation this year, but in the meantime, the opposition has attempted to capitalise on the government’s slow reform process by introducing their own legislation to replace SOAs.
Average advice document production times in hours
The report found opportunities to speed up advice execution included inconsistent use of tools such as digital signatures. A third of businesses “almost always” use digital signing services and those who do are faster at implementing advice than those who don’t use it frequently.
The report also noted that although advice documentation and implementation speeds are one measurement that practices are becoming more efficient, Iress conceded the index isn’t the perfect measure of business efficiency due to its limited scope that with factors like compliance and client satisfaction left outside the scope of the reporting.
All Advisely Index data is self-reported and the report’s sample size was 215 advice practices.
Less is more
The report cited software consolidation as a key contributor behind the efficiency gains in advice production.
While 43.6 per cent said one piece of software was used in the advice process, 48.5 per cent said two or three software programmes are required while 7.9 per cent said four or more.
Only 56 per cent of practices said manual data entry was required once, while 41 per cent said two or three times and 3 per cent said more than three times.
Hours to produce advice documents, by software platform usage
Outperforming the benchmark
The benchmarking service was launched by Iress last year to help small business advice practices better understand where they shape in the industry.
The report found the top 10 per cent of practices are 23.7 per cent more profitable, serve 40 per cent more clients and conduct an extra client meeting per adviser, per week, compared to the average.
The top 10 per cent of practices are serving 186.9 clients per full-time adviser (versus 133.6 for the industry average) and 151.9 per full-time support staff (versus 99.6 for the industry average).
The top 10 per cent of practices average 6.9 client meetings a week versus 5.8 for the industry average.
