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Keep your objectives on track

First, it is encouraging to read that Lisa is being so focused in seeking to implement her firm’s business plan systematically. Rob and I actively encourage our clients to spend sufficient time in not only drafting their business plans but, equally importantly, resourcing and implementing them and then reviewing them at regular intervals to ensure the objectives are on course to be met.

It is comparable to building a house – the design must be carefully thought through. For financial intermediaries, the equivalent is to ensure that the process of developing and reviewing the proposition and then segmenting the client base are rigorous.

Lisa’s use of back-office software to help ensure the plans for the business and for clients can be effectively implemented is also to be applauded.

However, it is also very important that this software is designed to work in tandem with any existing back-office software to ensure there are not IT processing issues either now or in the future. Therefore, seeking this confirmationis an important step to take, not least to ensure that any contractual terms with other software suppliers are not adversely affected and in extreme cases, invalidated.

I also suggest that Lisa checks that she has a robust back-up on a remote server to limit any disruption in the event of an IT failure.

Ensure that the process of developing and reviewing the proposition and then segmenting the client base are rigorous

The internal communication that Lisa and her colleagues are achieving through access to the project software is an excellent example of teamworking. We find instances where business owners, or on occasion just one individual, rush ahead with change but fail to keep their colleagues informed and also sometimes fail to get the support of their colleagues. Effective teamwork during times of change is vital.

Turning now to the RDR and the challenges it poses to intermediaries, we agree with Lisa that studying for and passing the exams take time and can impact on underlying business levels and profitability.

However, the longer-term benefits need to borne in mind:

  • The ability to continue to practice after 2012 we are doing. Making changes to any established business is a major project for most firms and just as we would advise our clients on the benefits of having a plan, a firm that seeks to make changes needs one too. Failing to plan is planning to fail – trite but true.
  • Higher levels of professionalism will enable relationships to be made and strengthened with fellow professionals such as accountants and solicitors, leading to a likely increase in business
  • A judicious choice of examinations also has the potential to enable intermediaries to enhance their propositions and their earnings as well as the underlying value of their business in the process.

With regard to the charges made by professional bodies for reviewing academic qualifications and documentation, it is a fact of life that administration costs money.

Whether the requirement for additional examinations is fair and reasonable has been extensively debated elsewhere and there is no purpose served in rehearsing the arguments here. We simply take the view that those wanting to commit themselves to a future need to act on the basis that the changes will happen and plan and act accordingly.

As Lisa says, it is best to be pragmatic and to look for the positives from the changes. They will enable intermediaries to build more professional businesses that are financially sound and have the potential to provide long-term benefits to both clients and themselves alike

Roderic Renison Director, The Ideas Lab

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