Significant numbers of financial advisers have successfully evolved their business models to place even greater emphasis on developing lasting, value added customer relationships.
Independent research recently carried out on our behalf, with both providers and advisory firms, confirms that post-RDR, account management is more important than ever. Seventy-eight per cent of respondents agreed that relationship management skills help make a good account manager.
However, whilst providers and advisers agree on the overall priority of relationship management as a required skill, the research also identified some important differences in opinion.
Post-RDR shift from selling to support
Sixty-seven per cent of advisers said they now need broader market support from account managers and nearly half believe that relationship management is far more important than simple product selling.
This is not unsurprising given the greater focus the RDR places on developing lasting client relationships.
However, it’s interesting to note that half of product providers feel that account managers’ focus on product selling has in fact increased. In addition, whereas only 54 per cent of product providers place significant importance on wider business consultancy support for advisers, 70 per cent of advisers feel this is important for them.
What this means for provider-adviser relations
Clearly account managers at providers still need to promote products to advisers – it is a fundamental part of their role. However, advisers need to be confident that they are working in partnership with providers who recognise how their needs have changed since the RDR. This means not only providing them with efficient access to the right product solutions for their clients but also offering a wider, added value, relationship-based service.
The differences highlighted in our research suggest that some providers may need to rethink the way they engage with advisers: a ‘one size fits all‘ approach is less likely to work in the new post-RDR environment.
Good account management will increasingly mean focussing obsessively on the development of high quality service-based relationships driven by good process, attitude and behaviour.
There is a further challenge for providers in delivering this though – and that is the potential conflict in trying to extend support for advisers whilst remaining cost effective themselves.
With the advice landscape changing in the post–RDR world, providers and advisers have an enormous opportunity to redefine how they work together. This is a chance to implement new business models which deliver a high quality service and strong outputs but also through a cost-effective structure. In fact, 65 per cent of all respondents felt that providers and advisers could work together in a more cost effective manner.
As we move beyond the anniversary of the RDR, the prize for those prepared to be bold and innovative is potentially very significant in terms of market share, cost effectiveness and reputation.
Angus Maciver is chief executive of The McCurrach Group