The reaction to the Treasury select committee’s recommendation to delay the RDR by a year has been vehement and rarely for the financial services industry largely unanimous. Among others, the CII and the ABI have said that any delay to the deadline would increase uncertainty and damage momentum.
Another consideration not mentioned by the CII and the ABI is that it will drag the process out even longer. Many advisers are well prepared for two years of pain while they re-engineer their businesses and sit exams. Postponing it for another year may lessen the impact in the short term but it is another year of flux and transition, worrying about exams and being distracted from the real business of client service.
It also delays the improvement of your business. Recent CII research showed that 33 per cent of those who do not currently take financial advice would consider doing so post-RDR. The RDR presents a business opportunity, a way to make advisory businesses more profitable and sustainable. As such, why wait?
The point is moot anyway as the FSA has said it remains committed to the existing timetable. Undoubtedly, there will be advisers who do not hit the deadline but among them will be those who have postponed and postponed in expectation that a change of government or a change of heart by the regulator would save them.
In this month’s Adviser Business, the focus is on knowing your business. Steve Billingham talks about how to deliver outstanding client service, focusing on reconnecting and gathering information on clients, so you know them better than anyone else. He believes this is a great insurance policy against them going elsewhere. Julie Hepworth at Perspective agrees that a key part of client retention is soliciting feedback from your clients and acting on it.
John Joe McKinley of Aegon talks about how you can analyse which clients are costing you money and decide how to deal with them. There are reasons to keep unprofitable clients but advisers need to be clear what they are and therefore why they are doing it. He also talks about how retainers can help deal with this.
Again, the key to this is knowing your business. You cannot decide where your areas of strength lie without a full analysis of your business and client base. Knowledge is power.