The independent financial advice (IFA) sector faces some significant challenges in competing with the strength of industry superannuation funds at both an individual and dealer group level, according to a financial planning technology provider.
While industry funds are rapidly moving into intra-fund advice, many IFAs are running inefficient practices despite the increased level of business coaching rolled out by many dealer groups, Provisio Technologies director Cameron O'Sullivan said.
Research from Jim Stackpool of Strategic Consulting & Training has found advisers are failing to generate enough statements of advice (SOAs) and are spending just under 30 per cent of their time in front of clients, O'Sullivan said.
"Planners are spending far too long on statements of advice when the technology now enables them to complete SOAs in a fraction of the time. This allows for more face-to-face time with clients, yet is more profitable at the same time," he said.
"IFAs may be able to compete [with industry funds] by using the technology now available to speed up the SOA process and lower the cost of advice per client."
O'Sullivan said the technology also allowed planners to better demonstrate their value, and enabled the flexibility to branch into transactional advice.
"It's not just about efficiency - it's about having the flexibility and the foresight to try new approaches to advice."
However, O'Sullivan said IFAs are currently at a major disadvantage to industry funds.
"Industry super has a massive advantage when it comes to attracting new clients," he said.
"They already have information on virtually every working Australian. They have a massive client book already and don't need to go and perform fact finds or search for new clients."
