Survey identifies dissatisfaction with tech, client acquisition, and succession planning
A recent study of Canadian advisors published by IG Wealth Management found a significant number of advisors showing dissatisfaction with their dealers across three key areas of support. The study identified technology as a key lever for growth among the majority of advisors, but it found 45 per cent of those advisors rated their dealer’s support as fair or worse. The majority of those same advisors said their dealer’s were less capable of supporting their growth in the high net worth business segment. Just as about one third of advisors surveyed said they plan to retire within the next ten years, 57 per cent said they lack a succession plan. One quarter of those advisors set for retirement still lack an adequate succession plan.
These gaps, Brent Allen says, go beyond just baseline dissatisfaction with tools and processes. The executive vice president, sales and distribution, at IG Wealth Management, argues that there are specific identifiable takeaways for dealers in these survey results. He argues that advisors are identifying the tech tools they want and don’t have, they’re specific about how dealers can help them acquire clients, and they’re acute in their needs for succession and business continuity plans. Allen stressed how dealers can invest to better meet these identified needs.
“The advisors that are highlighting that they want more from their dealer, it's because they can actually see the differences now across the largest wealth firms in this country for those who have invested in the commitment to build,” Allen says.
Advisors call for specific tech additions
That specificity was perhaps most clear on the technology stack responses in the survey. Allen notes that the respondents identified specific areas where they want to see their dealers add to their tech stacks, namely in the integration of generative AI. Ease of use and interoperability were also identified as areas of opportunity. Allen notes that having a tech stack is one thing, but ensuring that the various elements of that stack can talk to each other and operate seamlessly in line with an advisor’s workflow is a significantly more advantageous arrangement. He notes that many legacy systems advisory firms operate with lack that interoperability, and that meeting modern standards requires a more wholesale overhaul.
Allen cites the example of his own firm, which invested $300 million in their tech stack with the explicit goal of creating something comprehensive and connected. That involved integrating their CRM, on Salesforce Financial Services, and Conquest as their financial planning software. The digital forms and compliance functions were integrated into the CRM and advisors were given access to marketing portals and investment analysis applications. They added technology on the evolving estate planning side of the business, too, which their firm identified as an area of growing demand. Allen also notes that the implementation was done in consultation with an advisory group, ensuring that user feedback drove the use of the technology. He says that this kind of investment is a necessity in any firm’s tech stack, because they’re being judged against the apps that their advisors use in every other aspect of their lives on a daily basis.
“The benchmark that people use today for ease of use is not just their financial planning and work applications. It's everything we do in life. How I order a car service on Uber, how I order food through Skip the Dishes, how I book an airline ticket or something for travel. I can do it on my own time, when I want, where I want, full transparency of where I am in the transaction and notifications along the way,” Allen says.
The dealer’s role in the fight for HNW clients
When advisors initially call attention to a lack of support in attracting high net worth clients, there may be a temptation on the dealer’s part to put that onus back on the advisor, whose role it is to connect with and serve those clients. While Allen notes that the advisor bears the core responsibility for that trusted relationship, he emphasizes the importance of dealer investments that support those relationships.
Allen notes that many tactile elements of the client’s relationship with their advisor are in the hands of the dealer. Those include investment portals, communications tools, reporting quality, and the speed with which requests are executed. Given the complexity that comes with high net worth clients, Allen thinks that this expectation that dealers provide adequate infrastructure and service quality is reasonable. He doesn’t think advisors want their firms to just rent them a conference room and put 200 prospects in there for them, he believes they’re calling for improvements in the little things that clients notice.
Brand also plays a role in HNW client decision making and in what advisors value. Allen notes that the survey respondents said firm brand would be one of the top five reasons they would switch firms, along with reputation, technology, and support for high net worth clients. Given the role of the banks in Canadian finance, and the amount they spend on advertising, some smaller dealers need to be more subtle in the way they build their brand among HNW clients. Allen notes that his firm has had some success identifying business owners and connecting with accountants and law firms that serve them, using joint programs and events to furnish the first introductions into a trusted relationship. From there, it’s up to the advisor to deliver a level of service these clients expect.
Succession plans at the right time
The ongoing irony of this industry is that professionals who spend their careers building retirement plans for others, fail to build those plans for themselves. With one quarter of the imminently retiring advisors surveyed by IG saying they still lack a succession plan, Allen says that there is more dealers can do.
Allen stressed that these plans need to be long-term in nature and that firms need to offer both education and systematic tools to help advisors with their succession plans. He notes, too, that as advisors grow older they tend to place a higher priority on the relationships they have with clients and their desire to see them well served. Dealers, he says, can position themselves as a guide for their advisors and a resource they can lean on to support the transition.
Noting the example of his own firm, Allen stresses the importance of building a talent pipeline. This could include internship programs, employee advisor teams, and strong relationships with educational institutions. All those sources can help young talented advisors move into the entrepreneurial channel.
There is a challenge that many advisors face where they are less able to lift their eyes from the day to day to think about big picture work. Dealers, Allen says, can keep themselves from nagging their advisors by timing their interventions and education. Q4, he says, is often a business planning time for advisors, and dealers can use that time to talk with advisors about succession planning.
On the whole, Allen notes that there is a great deal for firms to take from is survey. He stresses, though, that rather than a to-do list for dealers, or an excoriation of their failures, this kind of insight should be treated as a welcome reason to improve service.
“Both internal and external surveys and studies are a gift to management. And if you take care of your advisors, then they will take care of your clients the best way they know how,” Allen says. “Be open to the results. It's information. Embrace it. Ask questions. And we'll continue to elevate the opportunities in this industry and provide better advisor and client outcomes is my hope by getting this information out there.”
