Reducing the number of platforms may not necessarily solve the inefficiency problem, as data integration continues to present problems for advisers.
Data from Investment Trends found the average number of platforms used by advisers is three, but research from SuitabilityHub found advisers will be looking to reduce the number of platforms they use as the fewer platforms, the less cumbersome it is for a business to provide advice.
Link Wealth managing director Steve Sloane tells Professional Planner the issue of data integration is “probably the major bugbear”.
“It’s really difficult to get all the platforms talking to each other and sharing data – we’re still hitting the roadblocks with that,” Sloane says.
“Trying to get the right data and getting access to client information is often difficult because platforms are not known to share that information.”
Sloane says while Link Wealth uses only two platforms, the problem of data integration is still present.
“There’s so many different platforms and so many different insurance companies and so many different systems that everyone’s got their own data, and our job is to pull that data together and then put it in a format that makes sense.
“Getting access to that data is quite challenging sometimes and can take a long time. The easier it is for us to get access to it and understand it…would be better and quicker for the client.”
The general consensus in the advice industry is the fewer platforms, the better, as platforms are yet to standardise their processes.
Advice business consultancy Finura Group said in January the time of “platform promiscuity” was coming to an end and firms would start to consolidate platform usage.
Forgetting ‘the old way’
The digital aspect of advice is both a positive and negative, as advisers navigate a tricky environment and tackle new problems as they arise. On the other hand, the use of technology has contributed to better efficiency.
Financial adviser Dimitri Kondilis recently set up his own firm, Kondilis Financial Planning in Rockhampton, Queensland.
Kondilis says the pain point for him is trying to forget how financial planning was “traditionally done” on the admin side.
Adapting to new digital processes has been a challenge in the establishment of his firm as he is having to learn how to utilise technology for greater efficiency.
“The pain point for me is trying to forget the old way of doing things, because that was really limiting how many clients I would see in any given month, [therefore] leading into how many clients I could service,” Kondilis says.
Outsourcing for efficiency
Sloane says another challenge the firm is facing is the length of time it takes to deliver advice.
“It’s taking way too long, once you see a client, to be able to do the work and deliver the advice,” Sloane says.
“[It’s] taking five to six weeks to provide advice to clients, which is far too long, and that’s really the biggest issue for my group and no doubt others as well.”
To help handle inefficiencies, Sloane has turned to outsourcing. He owns Philippines-based business Levera, which was built originally to supply administrative staff to Link Wealth and now has approximately 30 more businesses around the country that use the services.
Sloane says while it has improved efficiency, the heart of the issue is the time it takes to produce the advice.
“Once they get the paper…they’re very efficient, so that part of it is fine, because they can process words very quickly.
“It’s actually just delivering the advice in Australia that’s the problem and the time it’s taking to do that.”
Kondilis is in a more unique position, having recently set up his own firm. He says he has faced a number of challenges as he has to balance being a financial planner while running the core operations of the office.
“I’m like the office cleaner, I’m the tech guy, I have to do everything for the office,” Kondilis says.
“That was my biggest challenge, to still be a financial planner for my clients, but then manage the actual operations of the office.”
A report last year found the average Australian advice firm spends 56.5 per cent of the cost of advice on administration and compliance costs.
