22nd November 2010

M&G - How RDR is prompting a technology review

Many advisers are rightly focused on the most pressing aspects of RDR - the qualification requirements and shift to adviser charging. But a firm's client communication strategy will be increasingly important in the post-RDR world.

In the midst of some of the largest economic and regulatory upheavals in the history of financial advice, an adviser's Twitter strategy may be the last thing on their mind. However, social media is just one example of how the next generation does things differently and how advisers may have to adapt. As advisers are re-engineering their
businesses, there are a number of ways progressively to incorporate changing client communication needs.

The Inheritors

Many advisers will say that they are fully focused on their retiring babyboomers, who still like the old-fashioned way of doing business - face-to-face, at an appointed time, with a trusted adviser. But the children who will inherit that wealth will also need advice. They are likely to gravitate naturally to the same advisers as their parents as long as they appear to be serving their needs. Not having the business processes in place to service that next generation - the 'inheritors' - risks missing out on potentially lucrative business.

In a very short time advisers will be faced with a potential client bank that at the very least uses internet banking and is possibly extremely technically literate. The annual portfolio updates issued by life companies are likely to look archaic at best. Newer clients will almost certainly want to look at portfolios with greater regularity, or at least
be able to receive relatively instant valuations. This is only available through improved technology. The introduction of wrap can be part of that strategy. Equally, however, many advisers are finding that their existing systems have this capability; they just need to put time and resources into ensuring they are used properly. Ultimately, any system should be able to help advisers understand the profitability of each client and help them
service that client more effectively.

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Wraps & Platforms