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Needs musts

In the fourth in a series of articles looking at using technology efficiently to make time savings, I want to look at how IFAs ana-lyse client needs and, perhaps more important, the growing desire by clients to analyse their own needs online.

Quay Associates, the IFA practice which forms the basis of research into the use of technology by My Money Adviser, has twice won the prestigious Money Marketing IFA of the Year award. I was a judge on both occasions and Quay won the awards because of the comprehensive reports it uses to service its clients. Indeed, this is how I first came to meet Quay and how it became my IFA.

What I did not know until recently was that the generation of these reports was nearly killing the business. Each one took on average 10 hours to produce. It was during a strategic review of its business that managing director Roland Rawicz-Szczerbo realised that the only way to continue giving this value-added service was to use a back-office system with a built-in needs analysis tool.

With nothing in the market at that time, and using the innovative expertise of Rawicz-Szczerbo&#39s business partner Mitchell Philpott, Quay built the first version of its Link Product, heralding the birth of Quay Software.

In the case of Quay Associates, client fact-finds and holdings are held within its back-office system. Data from the fact-finds and holdings records are then sucked into the in-built needs analysis tool to create reports giving the clients&#39 relevant personal details, current level of cover and an assessment of any shortfall.

A summary shows where the needs are and, more important for compliance purposes, affordability. Report writing now takes on average 35 minutes. Imp-ressive stuff.

What about the client analysing his or her own needs? When My Money Adviser did its first round of roadshows in 2000, we spent considerable time trying to convince IFAs that clients will analyse their own needs. We were met with sharp intakes of breath.

Last week, we began a round of 20 roadshows with our new content partner, Intelligent Finance. It gave the same message, which was greeted with knowing looks and nods of acknowledgement. Those of you who have still to experience clients going it alone should think on this research which was published by the Henley Cen-tre, Lefevre and BT Fin- ance in 2000 and 2001.

36 per cent of the UK population got their personal finance information from the internet in 2001 compared with 20 per cent in 2000.

14 per cent bought online compared with 5 per cent in 2000 – an increase of 180 per cent.

UK investors using the web for information on share prices, Isas, pensions and mortgages increased by 80 per cent over 2000.

Self-analysis should not be considered threatening as long as you provide clients with the tools to carry out research and buy from you on an execution-only basis.

It will enhance the client relationship, ensure they remain loyal and leave you to do their more complex financial planning.

If you do not provide the tools for your existing clients to do this, then someone else will. Almost all the pioneering financial information websites now offer products. Why? Because they have built up a loyal and trusting user base and, importantly, because they get paid for doing so.

But is technology a replacement for face-to-face servicing? I do not think so. Research also shows that only 2 per cent of consumers who bank online have stopped going to their branch but their use of online banking has given them the choice of new ways in which to interact with their bank for their own convenience.

The message is loud and clear. The net will not replace personal service but it can enhance it.

What tools could you provide your clients with? Calculators are always a useful addition to your website. Financial planning guides, if well written and accurate, will enhance clients&#39 knowledge of topics that might be important to them at the time.

Fund research tools allow the client to chart the performance of their holdings or to research the latest information on funds they might have their eye on.

If you can enable clients to view their holdings through a secure access and add to this the functionality for them to transact bus-iness online through your agency, you have given them a powerful added-value service, leaving you to deal with the more complex financial arrangements that they will not want to do themselves.


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