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Don’t get lost in transition

Preparation for the exams is often cited as the essential element of the process of moving to level four. Yet many still fail to set enough time aside to assimilate the required level of knowledge, which does not bode well when the same individuals make the move to adviser-charging.

The IFA sector remains the domain of the artisan due to the high percentage of advisers who are self-employed. This constant reinvention of the proverbial wheel simply increases the cost to the client and does nothing to ensure quality is delivered.

As David Shelton states in his new book, and I paraphrase: “No process means no proposition,” yet, for many, this regularity of delivery is complete anathema. Yet those same individuals demand consistency of service in all other aspects of their lives and even more ironically are prepared to pay for it. When it comes to communicating the value of their proposition or developing one that people would play for and recommend to others they balk at it.

Now, developing a proposition is not something that can be done at zero cost and there too hangs a tale. I constantly read of advisers complaining about the cost of examinations, the cost of moving to fees and so on. Why can they not see this as an investment? It is ironic that we spend our time telling clients to focus on the importance of advice yet many will not invest in its development or refinement.

I am sure some may tell me that these costs are a barrier, yet why was it not a barrier to us early adopters? I was once told that advisers were too busy to study or, worse still, that the financial planning certificate was a one-off, the likes of which would not be seen again.

We need to encourage all advisers to become followers of the glass half-full view of life, the opposite will rarely provide the opportunity to move forward with any confidence. Most advisers have a genuine wish to help their clients and this is a message that needs collective reinforce-ment. Working together will be the new model that truly helps many firms to prosper and develop. Feeling sorry for ourselves is corrosive and needs to be avoided at all costs.

Helping each other will enable a faster transition and allow all involved to avoid the mistakes made by others. Making mistakes should not be a source of shame but a badge of experience. The providers can be the enablers, subsidising process development and testing, they cannot all provide a business doctor service.

Last weekend, I struggled to assemble a patio heater as the instructions were less than clear, I then realised that the manufacturer was based in Germany and decided that there was a significant chance that the instructions may not have been translated effectively.

Using my schoolboy German, the instructions made more sense and the job was completed in a matter of moments.

Maybe that is the real issue in transition and if the message is translated properly it will all work out. That risk of inaccurate translation applies to clients and advisers alike.

Robert Reid is managing director of Syndaxi Chartered Financial Planners


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There are 6 comments at the moment, we would love to hear your opinion too.

  1. It won’t surprise you if I say I take a somewhat different slant.

    If advisers didn’t realise that exams or benchmarking or testing was coming (as early as the publication of the Gower report) one rather wonders what else they didn’t (don’t) foresee. To make the excuse of affordability is yet again a bit facile. Never mind the fact that it may make you feel good or enable you to stick a sheet of paper on the wall, it is just another business overhead. If you can’t afford the overhead – become employed.

    This of course brings me to your remarks concerning self employed status. What’s wrong with being self employed? Those professions which are forever being held up as a model for IFAs – Solicitors and Accountants are in the main still self employed (not withstanding LLPs). Some stockbrokers are still self employed. Private medical practitioners (specialists etc) are self employed, surveyors, dentists and a whole host of other occupations have many self employed practitioners.

    To quote Göethe:

    Du must herrschen und gewinnen
    Oder dienen und verliveren

    (For the less linguistically adept: You must be a master and win,
    Or Serve and lose. I take this to mean work for yourself (self employed) or be a drone.)

  2. I used to think that the way we were going to expand our business and retail control of the behaviour of our advisers was going to be to employ them rather than offer a self employed contract.

    Then we discovered a different approach to business where we adopted a team based approach to the delivery of advice, implementation and review services. We also centralised the investment advice process to ensure we were all singing from the same sheet.

    This, coupled with a “case conference” approach meant that all the relevant skils, knowledge and qualifications could be bought together by the team rather than the risk based approach of allowing an adviser to do the whole thing and then retrospectively justify it to the centre.

    There is no difference in fact between self employed and employed status in a team based environment.

  3. Nothing wrong with being self employed but its incompatible with a firm with more than the equity holders as advisers. Allowing everyone to do their own thing simple raises risk exponentially.
    As to the other professions they have their processes too, its the absence of standard process that increases risk and that applies to all.

  4. I think Nick’s process is a good way forward and when or IF we look to expand again, I think it is the way we’ll look to work next.

    I agree with what Robert Reidf says and investing in one’s education is a good idea and I am happy to do that. I am not happy to invest much though if the goalpost keep moving so much. (anyone remember pension simplification, one of these days I WILL get round to packaging my CF9 manual back up and positing it back to Alistair Darling and ask is he can get a refund for me from his mate at No10 if they are back on talking term)

    If they stay still long enough, then I will again invest in my eductation ( I was going to do the Islamic Finance exam from the SII, but even that’s on hold until after the final RDR requirements are out)

  5. Should have gone to Specsavers..

    Can’t see the woods for the opinions.

  6. Now that’s where I can wholeheartedly agree with Rob.

    Self employed equity holders as advisers is what I should have put – so thank you Rob.

    I fully concur that self empoyed RIs in firms (or networks) can be an absolute recipe for disaster. That is exactly why we see all these whopping fines. (Park Row being the latest in a long line).

    The management are sloppy and where iron fist rigid control is needed they prefer to go for the easy option as in the end they are often nothing more than parasites hoping to buy their Bentley on the back of the efforts of the drones. Don’t get me wrong I’m no socialist, but more often than not I don’t see what value many employees derive from some of these firms. I will admit that there are firms where I imagine it is a pleasure and rewarding to work, but the evidence seems to point to too few.

    I was an employer (of 50+) but that was in manufacturing – an entirely different ball game. Being an IFA is very much a ‘personal service’ and that is where I see the dichotomy and the problem when firms wish to grow their numbers. The criticism is that being populated by micro firms makes us a cottage industry. Well provided it is a well run, effective and profitable cottage industry I see nothing wrong in that.

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