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Using technology advisers can become market disruptors

The market leading adviser firms in 3-5 years time will be running their businesses to the limit of their technology and will have fully integrated their service with their clients’ needs, IntelliFlo executive chairman Nick Eatock tells ABR editor Rob Kingsbury

The conventional way to look at technology is as a tool to support the business process. But technology has developed so rapidly in the past few years, argues Nick Eatock, executive chairman of IntelliFlo, that if advisers want to be market leading firms, delivering the kind of service that their clients want, then they need to be looking at what technology is now available (and in the pipeline), what it can provide for their business and how they can develop their business model to take advantage of that new technology, rather than the other way around.

“If I were starting a business now, looking at the technology available in the market today and what it is capable of, I would be building my business model around that capability,” Eatock says. “If you take that mindset, you will be very effective because you will be very quick to get your business going, it will be an effective process and it will be ahead of where the majority of the market is at present.”

Disrupting trends

Advisers should look at how technology has changed industries through companies like Uber and Airbnb, Eatock says. “Uber didn’t change the fact that people wanted a taxi from A to B, and Airbnb didn’t change the fact that people wanted accommodation whilst abroad. What they did do is change the way people engage with the access to those things. They changed the customer experience.”

Advisers need to be thinking ahead, looking at the kind of experiences that consumers are getting from other financial services companies like banks, as well as companies outside of financial services, and ask the question, ‘what will they expect of us this year as well as in three or five years time?’, Eatock continues. Firms then need to look at whether they are in a position to deliver that kind of service – and pertinently for the future, whether their closest rivals are better able to do so. They also need to be looking at the robo-advice space and what services they can deliver that marks out the value of advice while also addressing the rise of online services.

“I think advisers should be open to changed customer experiences and look at dealing with things in a different way to how they have done things before.

“As an adviser, it isn’t about destroying the fundamental value of what you do. Your business model and the values you stand for should persist but you should be open to change in the way that you deliver that value,” Eatock says.

“Right now, I think advisers are in a very good position because the most logical other contenders for the advice crown are the banks but the banks have no personal relationship with their clients. That is invaluable and technology is not going to instantly give you that level of relationship with consumers.

“It’s a massive USP for advisers. If they augment that with what technology can give them then I think they are going to be tremendously successful.”

Intrinsic to delivering a ‘future proof’ service, Eatock says, is the need to bring in the end client and make them part of the overall proposition. “By that I mean that, currently, advisers’ service to their clients can be a bit opaque and their processes can be inefficient and expensive to run. This can make the advice business challenging both for the end client and the adviser firm. Technology, through capabilities like client portals, is banishing both those barriers.

“Back-office access for advisers and for clients via portals is now literally in their hands, via smartphones and tablets and is helping to ensure that what advisers provide is matching modern service expectations.”

Advice boom won’t last for everyone

While at present there may be more than enough demand for advice in the market – massively increased by the pension freedoms – making it a good time to be an adviser, says Eatock, “over time the demand/supply gap will be narrowed as technology helps commoditise the market, leveling the playing field in the advice market.

“I still think that customers will want a conversation, especially those in the decumulation phase of their financial planning, but that conversation may happen over Skype or other channels preferred by the client rather than dictated by the adviser.” Firms that are not offering consumers the kind of service they want and expect, and increasingly that will be online, may find they get left behind, he adds.

“Advisers that embrace the developments in technology available to them and start using them in their business now, have the opportunity to steal a march on the market that could have an impact on the success of their business for years to come.”

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