A survey of Australian financial advisers has revealed many believe their dealer groups could be doing more to support them, particularly in the way operations are structured financially.
The survey, How much does your Dealer Group ‘do’ for you?, was conducted by BTO Group last year and sent out to more than 6,000 representatives from the country’s 100 largest dealer groups. It was completed by 180 advisers.
Rather than assessing the mechanical elements of a licensee’s offering, such as research and approved product list offerings, the survey looked at various aspects of day-to-day support – and found advisers generally scored their group no better than a five out of 10.
Looking at groups on a ‘financial basis’, the survey asked questions around how dealer groups plan to increase shareholder value, improve practice growth and productivity, manage income, negotiate contractual agreements and benchmark the practice against others in the group.
Participants rated their dealer groups at just five out of 10 on a financial basis.
BTO managing director Steven Skinner said this represented one of the biggest opportunities for dealer groups based on the survey findings, particularly because practices generally do not monitor the time staff are working, meaning they cannot gauge productivity.
“Getting their leverage structure right – and their ratios – represents the biggest opportunity for financial planning groups to perform better in terms of profitability, which feeds into shareholder value,” he said.
“Imagine if you were able to track the time [staff] were spending so you’ve got a complete understanding about the profit drivers of the business.
“If you could track the client engagement from the initial fact find, delivering the statement of advice, if you could track all the workflow and all the activities in terms of the internal processes to deliver that, that would have to be a good thing. Seven out of 10 of these principals and senior advisers said if you centralise [operations], that would be a good thing.”
The survey’s assessment on a ‘strategic basis’ – gauging the help provided to identify an overall strategy and mission statement and to survey clients – found advisers rated their dealer with a six out of 10 on average.
From an ‘internal’ perspective – assessing the help given to advisers to improve their skills, review fees, improve client engagement and promote their brands – dealers gave them a six out of 10.
From a ‘client’ perspective – which reviewed help given with client value propositions, developing referral programs, communicating with clients (including help with social media) and other client value-adds – groups were also rated six out of 10.
Finally, dealer groups were rated five out of 10 on a range of ‘learning and development’ metrics. These covered human resources issues such as staff career development and appraisals; information capital issues, including standardised data management policies and IT; and organisational capital issues (helping with culture, leadership, alignment, teamwork and motivation).
When it came to centralising functions such as accounting and payroll to benefit from economies of scale, as well as applying group-wide procedures, advisers rated their dealers with a seven out of 10.
