88% of Advisers would not use an outsourced Paraplanner

Nearly nine out of ten advisers say they prefer to employ a full-time paraplanner as part of their in-house team instead of turning to an outsourced paraplanner, exclusive research from Panacea Adviser has revealed.

The survey of just under 90 advisers asked if advisers consider outsourced paraplanning an attractive option for their firm, to which 88% responded to the contrary that they currently favour having a paraplanner on board as a permanent member of their in-house team.

Less than 1% of advisers surveyed said they would consider outsourcing paraplanning in the future.

We believe that the Retail Distribution Review (RDR) expedited the already expanding nature of the Paraplanner’s role and made them a ‘must have’ resource for many smaller advice firms looking to maximise their earning potential.

Against this backdrop, we might have expected to see a sharp uptake in demand for both in-house and external resources, something which makes the lack of popularity surrounding outsourced paraplanners in our latest survey a somewhat surprising result. However, in our opinion, this does not suggest that outsourced paraplanners somehow have less to offer than their in-house counterparts, they just need to do more to shout about the time saving and other benefits that outsourcing can bring to adviser firms.”

INDUSTRY VIEWS ON PARAPLANNING

The research also gathered opinions of both paraplanners and advisers, highlighting some of the key challenges – and benefits – that using this type of external resource can bring for advice firms.

Nathan Fryer, Director of outsourced paraplanning firm, Plan Works, said:

“I can fully understand why advisers would be apprehensive about outsourcing work of this nature to a third party. In many ways if I were advising myself, and could afford it, I would most likely look to employ a full-time paraplanner too. After all, inviting a stranger into what is quite often an adviser’s “life work” can be bewildering. 

“It’s this that makes communication so key when it comes to outsourcing, explaining why many outsourced paraplanners actually offer a bedding in period for the two parties to get to know one another and identify how they can work together.

While it is also true that having someone in-house can assist with other tasks such as admin and marketing, paraplanners are actually becoming increasingly few and far between, which means that salaries are also being pushed higher and higher.” 

Morwenna Clarke, CFP from Portland Wealth Management, also commented:

“We actually have a successful outsourcing relationship with a paraplanner at present but, in the past, we have come across issues around data protection when outsourcing.

“It seems that some outsourced paraplanners contracts don’t cover the legal issues around protecting and storing customer data, which could potentially see the adviser breach certain European laws. Another issue that may deter some advisers from turning to an external paraplanner is the changing definition of what constitutes a ‘worker’ under UK law, which may make it difficult to work with an outsourced paraplanner.”

As with every element of your business, it is important to ensure when working with a third party that the proper data protection licences are in place and that advisers work closely with their outsourced paraplanners to identify secure ways of communicating and storing data. This should help overcome some concerns that advisers have around using outsourced paraplanners.

Panacea Adviser provides opportunities for advisers and outsourced paraplanners to connect via its Paraplanner Directory and at no cost.  Here, outsourced paraplanners are able to include business details and links to their own website – allowing them direct access to Panacea’s 19,000 strong community.

For more information on the Paraplanner directory please click here. 

Boring is as boring does

Panacea comment for Financial Advisers and Paraplanners

5 Sep 2016

Boring is as boring does

I recently had through my door a local magazine, you know, the type that has all sorts of information in a semi glossy, very thin A4 format about local ‘stuff and people’ that these days the internet is the ‘go to’ to find out about.

I do not know why but my wife started to flick through some of its pages before consigning it to the bin as she usually does.

A few pages in she came across an ‘advertorial’ piece from a local IFA. What drew her attention in particular to this was that the IFA in question used to work for me in his first steps toward becoming an IFA.

What attracted me to him was his personality, his enthusiasm and ideas. And above all a desire to make a difference.

But what has happened to this ‘bright young thing’ some 15 years later?

The editorial was, in her opinion, boring, lifeless, colourless and totally bereft of any encouragement to speak to him or his firm about financial advice or becoming a client.

In financial services today, to attract new clients to new businesses, or in fact any business, great marketing is essential. It should be with a digital focus and should be aimed at engaging with the client audience you are trying to attract. It should make a statement about your firm, what makes you different, what you are experts at and why they should choose your firm.

The UK finance sector was the second biggest spender online, accounting for 13.4% of total adspend (IAB/PwC adspend survey H1 2015).

In the USA, total digital advertising spend for 2015 saw rapid growth, reaching $58B. US mobile devices surpassed desktop in share of digital ad spend, accounting for 52% of the total.

The finance sector was one of the earliest adopters of Internet advertising, quick to see its exceptional accountability and numerous opportunities to build brands online.

Display, search advertising, social media, affiliate marketing and behavioral targeting are just some of the methods which key players in the sector can use to reach their audiences in an effective and engaging way.

The reason for so much mobile device engagement is due to the general mobile accessibility for consumers in their downtime- travelling, waiting, lunch breaks and of course the fact that today so many firms block private internet browsing in the office.

There are some brilliant examples out there of advisers grasping the digital way forward using video, blogs, and social media channels.

So go digital, bin the boring and engage with the opportunity the 21st century makes possible.

As Steve Jobs said Design is a funny word. Some people think design means how it looks. But of course, if you dig deeper, it’s really how it works”

And when it works, it works very well.

Tattoos and the workplace

hirefireNow I do understand that as the generations roll on, standards and expectations in business do not always meet with what would have been deemed acceptable in my younger days, but after my recent meeting with my new business banking relationship manager, something appeared very wrong in the world of banking and possibly elsewhere.

Tattoos are not everyone’s ‘cup of tea’ and it is a sad fact that they can, in extreme cases, give an impression that may quite unfairly, not match with the individual’s actual personality, capability, lifestyle or knowledge.

Self-expression for ‘my generation’ by way of ‘inking’ was once strictly reserved for south sea islanders, bikers, teddy boys, the military and the criminal classes. Today it has found its way into the boardroom. Men and women equally seem to exercise some poor ‘placement judgment’ at the tattoo parlour as the nations low literacy skills present ‘inkers’ difficulties in getting the spelling right as the big new danger.

According to ACAS “About one in five British people are thought to have one, and they’re most popular among 30 to 39-year-olds, with more than a third admitting to being inked and one in ten people in the UK are thought to have a piercing somewhere other than their earlobe”.

They go on to note that according to a recent study this particular practice is “extremely popular among women aged 16 to 24, as almost a half (46 per cent) are alleged to have a non-earlobe piercing.”

Although the ‘blue collar’ world is loosening up, not all ‘white collar’ financial services firms, large and small across the UK are ready for studded and inked employees since it’s only recently that tattooing and piercing have become so very mainstream.

Indeed, most small businesses I have spoken with do not have an ‘inking and body art’ policy in place.

Dress down Friday has not yet been replaced by ‘ink up Monday’, or has it?

I am not sure what image anyone these days is looking for in a bank manager but I would suspect that putting Captain Mainwaring to one side, one would perhaps expect a sense of some form of ready for business etiquette by way of dress, a certain understated sense of business interest, professionalism and enthusiasm.

It may be that todays employers are so ‘hog tied’ by human rights and political correctness that staff who are in customer facing roles can turn up for work as if they were either off to the pub with their mates or have just come from the pub and have not had time to prepare themselves for what pays the salary.

My new banking relationship manager was around early thirties, he was scruffy and had an enormous dark blue ‘Polynesian style’ tattoo extending the length of his arm to below his wrist, what may be elsewhere was best not contemplating.

Putting aside any prejudices, is it so wrong to expect that even in today’s world of more casual business standards, anyone in a financial services customer-facing role representing their employer should at least look the part?

What message is conveyed to a firm’s customer by the sight of a heavily inked, pierced thirty something individual who is there supposedly to represent his corporate employer in dealing with your best business interests?

Tattoos are for life it would seem but are they for business life? Many large employers have policies that do not allow visible tattoos. Depending on the employer’s industry and the type of job, this may make sense.

Does your firm have any ‘inking’ policies in place? Have you experienced any negative customer or staff reaction relating to tattoos either as an employer or as an “inked employee’?

 

www.panaceaadviser.com

Panacea Adviser survey: 89% of advisers say Robo-Advice is a threat to the industry

Almost nine out of ten financial advisers warn that automated services pose a threat to traditional face-to-face financial advice, research by Panacea Adviser has revealed.

In a survey asking 118 financial advisers whether robo-advice presented a threat or opportunity for face-to-face advice, only 11 per cent described it as a positive for their industry while the vast majority raised concerns that robo-advice could prove damaging to traditional financial advice.

Commenting on the results of the research, Panacea Adviser Chief Executive Derek Bradley, said: “With the amount of attention and industry debate sparked by robo-advice, it is perhaps not so surprising to see such a strong reaction from advisers towards the ‘rise of the robos’. The current mood appears more unusual, however, when you consider that automated services still represent a relatively small market here in the UK while the technology itself is also fairly limited at this stage.

“The US market also offers a glimpse of what looks like a more positive outlook for advisers when it comes to robo-advice. The ability to combine elements of both human and automated advice is actually seeing many traditional advice firms in the US prove more popular than robo-advice models that rely solely on technology.”

ADVISER VIEWS ON ROBO-ADVICE

The research also gathered adviser opinion on both sides of the debate, highlighting some of the key challenges – and benefits – that automated models can bring for advice firms.

Pete Matthew, Managing Director for Jacksons Wealth Management, believes marketing could prove the biggest hurdle for firms looking to adopt robo-advice. He said: “An online service can provide a way of perhaps serving ‘lower value’ clients in the short-term so that they engage with the adviser’s brand, which may well lead to higher-ticket business in the future.

“But while the technology behind robo-advice actually appears to be straightforward enough, the real issue is that most advisers are clueless when it comes to marketing. The world of marketing has changed immeasurably. Now, it is all about providing value to the prospect by educating, entertaining and inspiring clients to take action. The social aspect should not be underestimated either. Increasingly people buy based on the recommendations of social media circles and unless advisers are influencing within these channels, no-one will show up to their fancy robo-advice websites.”

 Alan Hughes, Partner at Foot Anstey LLP, also calls for the FCA to clarify what constitutes ‘advice’ and ‘guidance’ in relation to automated-models. He said: “As robo-advice develops, advisers need to consider carefully how it impacts on the market, what that means for their own business and clients and how they can use this as an opportunity. Robo-advice will never completely replace face-to-face advice but it is a case of “ignore at your peril”.

“Going forward, any further clarity that can be provided on the difference between advice and guidance will be very useful in bringing automated models to market. The FCA should explicitly address these issues and be proactive, rather than just tweaking the regulatory framework and then telling firms that they need to go off and reach their own view.”

Focusing on the regulation of automated services, Derek Bradley added: “A vital UK consideration that would assist in the adoption of robo-advice models is that the FCA approves the technology and their complicated algorithms. Some time taken now could mean that the constant retro aspect of regulation against products or advice is removed and public confidence in a ‘fit to fly’ model will see a greater, quicker embrace by advisers and of course the public.”

 

www.panaceaadviser.com 

Getting your Human Resources in order

A free guide to HR by Panacea Adviser

These are significant times for the advisory profession as regulation continues to drive financial services to the brink. Consequently it is of great importance that adviser firms have the right people in place and know how to get the best from their staff.

This is why we have developed this new guide, ‘Getting Your Human Resources in Order’, to try and help clear up any human resource ambiguity, as effectively managing HR is essential.

This guide takes business owners through the basic principles of how to hire, manage and get the best from their employees, to dealing with disciplinary issues, maternity leave and subsequent return to work, and finally how to handle redundancies. All key factors to ensure your workforce remains a contented one and you are safe in the knowledge that you are doing things in accordance with employment law.

In an industry where regulation is ever changing, it is important that staff do not, for they are one of a company’s best assets and when treated fairly, a business is more likely to succeed.

This guide is intended for small firms, and line and team managers in larger organisations.

Download for free at http://www.panaceaadviser.com/hrguide

Gizza job, I can do that.

The New Year is traditionally a time when many people reassess their professional roles and decide a change may be worth pursuing. For many people I suspect this involves looking for a new job – indeed recent research published by the Institute of Leadership and Management (ILM) revealed that 37% of workers say they are planning to leave their current jobs in 2015, a significant increase on the 19% who answered the same way in 2014 and the 13% in 2013.

But what about the financial advisory profession? How many advisers reading this article are considering a career change? I suspect very few although, given the average age of advisers, I wonder if most aren’t looking forward to retirement with some considerable relish. To be honest, I can’t blame those advisers who might be looking for an early exit – this job comes with some significant pressures to deal with whether they are in the form of regulation, increased costs, political interference, constant change, professional development requirements. The list goes on.

Unfortunately having to cope with these ongoing developments and the growing requirements placed on advisers has – in this country at least – somewhat detracted from the attractiveness of financial advising as a career choice. I am always interested in the ‘job reaction’ you get from people when you tell them what you do. How are financial advisers perceived? Are they thrown in the same pot as estate agents or journalists or parking wardens? I hope not given the job advisers do and the focus on quality and service.

Then again, the nature of what a financial adviser is and does has been systematically depowered by the continuous regulatory changes and developments. It is about to become even more confusing for consumers in April when a whole host of pension ‘Guidance agents’ are unleashed on the at-retirement market with only a requirement to have “some pensions knowledge” as the recent Citizens Advice job specification put it.

Of course it doesn’t have to be this way. Last year research conducted in the US by Rapacon placed being a financial adviser as one of the top ten jobs to have in the future. It is clearly a sought after career choice suggesting to me that the profession’s reputation across the pond is not just intact but strong and enticing to those looking at their employment. Can we really say the same in the UK?

So, how can we improve the reputation of the profession, ensure it is attractive to new blood, and develop greater consumer understanding of what advisers do, their value and worth, and why it’s a job worth having? Like most things, I believe it’s important to start with yourself. To that end, it’s about being the best you can be in your individual role which does mean self-improvement, lifelong learning, a commitment to continuous professional development, etc. If advisers are focused on self-betterment, on improving themselves and increasing their own standards, then this will clearly feed into the service they offer which will improve reputations and generate strong feedback and referrals.

Advisers need to be fully focused on their own roles which means not getting into a rut and instead retaining interest in the job and everything about it. Learning more and securing greater knowledge is a fundamental way to do this – we have recognised this for some time which is why we established a CPD library containing both structured and unstructured material which is easily accessible and allows the adviser to continually load up on new information. It will not only help the adviser improve their service offering but feed through into a growing positive reputation for the profession.

A profession renowned for its security, its prospects and the quality of its overall offering will clearly be attractive to those who are working in other areas or have yet to start work. While the legal, accountancy, and banking sectors have been tapping into the graduate market for decades, establishing these careers as worth pursuing, unfortunately the advisory community has not been working at the same level.

If we do want to bring new blood into our community then we certainly need to begin pushing and marketing the profession in a much more focused and structured way. Our professional and trade bodies must work closely together on developing an ongoing campaign that supports individual firms’ own recruitment policies if we are to raise the profile of being a financial adviser and make it stand out from the crowd. This should be a long-term commitment that highlights the positives of the profession and sets out the very tangible and compelling reasons for being part of it.

With the New Year being a time when many people consider what they should be doing next now is certainly the right point to secure our own professions’ future.

 


Advice 4 You

Earlier in the year we explored the Waterbed effect, a phenomenon that has the natural (not necessarily intended) potential, to squeeze one part of a complicated and complex regulated business model to cause a serious bulge elsewhere in the process.

It is a common sense albeit simplistic analogy supported by a little known mathematical formula called Bode’s Sensitivity Integral.

The Waterbed effect has been well illustrated in the mobile phone industry where regulation and political interference fixes, distorts or manipulates the prices of basic products and services only for consumers to see complicated pricing structures ensue by way of significant increases in the price of peripherals and additional services as a direct consequence.

Airtime providers have been hammered by regulated price cuts to the cost of phone calls, in particular with the EU parliament setting very strict limits on how much customers can be charged for using their phones on holiday. The ‘Waterbed effect’ in this case is that these airtime providers have been looking to take out cost from their businesses and the chosen method is to self distribute.

So although it may come as a surprise that Phones 4 You has shut up shop, the industry and politicians should take note. Because what happens in one industry with an intermediated distribution model can easily move to another.

Financial services providers are still feeling their way after RDR. They have seen their ‘distributors’ segment client bases, re-evaluate business models and move away from the selling of products to the selling of advice.

Typically in doing so, these firms have concentrated on servicing much smaller numbers of clients, the unintended ‘Waterbed effect’ here being that the mass market consumer has no longer got somebody independent to ‘buy’ from or be ‘sold’ simple products by for ‘free’.

Simplified advice as the FCA advocates is simply a non-starter at the moment and all those product providers have businesses to run, products to design and products to sell.

Do not be surprised if the future of financial advice sees itself as a ‘Doppleganger’ of the mobile phone industry with the ‘Waterbed effect’ being the realisation that the mass market is a huge opportunity but a minefield the consumer will have to walk through unaided.

For more please visit www.panaceaadviser.com