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The whole tooth

I am constantly amazed at the way other professions are implementing technology to improve the way they look after their clients. Let us take a very simple example.

I had a filling replaced rec-ently. Instead of filling the cavity himself or taking a mould and sending it to the laboratory to build, the dentist used a digital camera to take precise measurements of the cavity.

He then mapped the perfect replacement with a graphics package before placing a small ceramic chip in an electronic lathe which manufactured the perfect new inlay. Throughout the process, I was shown exactly what was going on via a PC monitor.

At no point did I get the impression that the dentist was any less skilful as a professional because he was making the machines carry out detailed and complex measurements.

On the contrary, I was impressed at the investment in state of the art technology that had been made to protect my health and future well being. Here was a perfect example of a professional making the best use of technology to complement his personal skills.

Had I been taking financial advice, the chances are that the process would have been very different. It is a sad fact of life that financial advisers are more likely to hide the technology they have at their disposal rather than display it proudly.

As every week goes by, more and more services are being launched that can save advisers&#39 time and money while at the same time imp-roving the quality of customer service they are able to offer. Yet how many advisers make a point of showing their clients the latest tools at their disposal to make sure they are giving the best poss-ible advice?

In recent weeks, I have spent a lot of time considering why it is that, for the most part, IFAs are reluctant to adopt technology, let alone use it in front of their clients. One of the conclusions I have reached is that as an industry, our terminology is not helping. Generally, systems that will hold all client records and details of transactions would, in our industry, be referred to as back-office systems.

There is a very obvious implication in this statement that these are systems that should be kept in the back office, that is, behind the scenes, out of the sight of cli-ents. Systems that are used to carry out the boring but necessary tasks in a business.

Not something to use with customers, systems used by administrators and paraplanners, not advisers. Yet is this a fair description? Five years ago, it might have been but today?

The leading packages in the market are now in fact fully functional client management systems. Used properly, they can record every aspect of a customer relationship and should be right at the heart of the whole business. They can help advisers scientifically diagnose clients&#39 attitude to risk, identify the areas of most need and publish client portfolios to the web.

Millions of financial consumers view their bank balances and statements online every day. A few years ago, it looked like the banks with their multi-million-pound IT budgets would lead the way in delivering similar services to consumers covering their packaged investments.

To date, only a handful of banks have capitalised on that opportunity. In the meantime, an increasing number of software providers are making the same function available to even the smallest IFA businesses for a fraction of the cost. It is now in the hands of each IFA firm to decide if they want to see their clients&#39 banks offer their clients online portfolios before they do.

In many ways, the data network provided by specialist IFA software has become the central nervous system of the business. The vast majority of advisers I know consider client management to be their single most important function. Why then are we hiding the technology that significantly enhances that process in the back room?

If an advice firm has a system that really is only addressing back-office functions such as reconciliations and commission settlements, it is time to go looking for something new to help run your business.

Those who have already empowered their business with leading-edge technology should be confident about demonstrating the investment they have made to look after their clients&#39 interests.

While progress is being made in delivering information on existing contracts, in the area of processing new business, far more effort is needed. Here it is not only the adviser community that needs to change its approach to using technology. Providers must recognise that offering an extra 5 per cent commission is not going to get IFAs making electronic submission their standard way to do business. There needs to be real benefits for the advisers and their clients.

The Exchange recently announced that over 100,000 new plans have now been submitted to insurers via their platform but let us get this into context. According to the ABI, there were 1.4 million new life and pension plans set up last year. Assuming a saving of in the region of £50 per plan, the 100,000 cases via The Exch-ange would save a very worthwhile £5m, if we could write all new business electron-ically the saving would be around £70m.

To achieve this as an ind-ustry, we need to make it easier for advisers to submit business electronically than using paper forms.

At the same time, we need to see full electronic tracking of all new applications regardless of how they are submitted that is, to support both paper and electronic applications, electronic commission messages and all providers, inc-luding those with closed books, making electronic messaging the standard way to deliver any information on an exist-ing contract.

Until recently, industry technology was more a matter of empty promises than delivering real value. That process has started to change. The job is far from over but with a positive approach, we can now create the changes necessary to drive out costs and make our industry more efficient.

We need to change the terminology, change the mentality and change the very culture of our industry. The tools to achieve this are increasingly at hand, the question is will when will we be ready to proudly embrace them?

Only if we do can we realistically expect to achieve the economies that are nothing less than a survival issue for advisers and product prov-iders alike.

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