As I sit in my home office after a month of “shelter in place,” I think through the realities of the situation that we are all in. At first we all thought it was only going to be a short time out of the office, but it’s turning out to be longer than anyone imagined. In the Anderson household, the realities are that our sons are virtual learning from their rooms, practicing their music more frequently and getting better every night in their respective video games.  My wife lives on Zoom calls and as the executive director of a nonprofit, she is hyper-focused on supporting her team and their mission. We are lucky.

My weeks used to be filled with traveling to various conferences to speak, writing papers (and this blog) and managing a team of investment and planning professionals. While the travel is out and most of the speaking has turned into webinars, I have also become an industry observer.  During the last 4 weeks of what some have called “captivity,” I have been watching our industry evolve and grow. I have been so impressed with the outpouring of advisor commentary, videos and stories about how they are handling the challenges. Maybe I am lucky to know some of the best advisors but my guess is even the advisors that I don’t know (i.e. most of you) are doing the same thing — the right thing — taking great care of your clients.

What has been proven (so far)

What have we learned?As advisors are talking to their clients while the markets gyrate all over the place there are a few things that are becoming clearer every day. These things are going to change our business. Here is a short list of what I see:

  • Advice beats product, every time. Having a plan in place that is focused on goals and progress-to-goals reporting helps to give clients piece of mind during these times. Co-planning with clients allows them to put the whole situation into perspective and which may result in advisors being viewed as trusted partners instead of product salesmen
  • Empathy beats the Dalbar chart. Time and time again I hear from advisors who say that their conversations are more emotional than ever. Clients just want to be heard, not “convinced” that it isn’t different this time. One advisor I talked to has, what she called, “a walk and talk” for clients. She said, “We get on our cells while each talking a walk and I let them talk about what is of concern and try to address it — hand holding and mostly listening.” This isn’t about proving the market will come back, it is about listening.
  • Personal relationships beat generic advice. I see virtual advisors, custodians and others in the business touting “stay the course” messages. But is that the right answer? Maybe it is, if the client is in a well-diversified portfolio (or group of portfolios) that was designed to meet the client’s goals, but what if it was not?  Personal advice, meaningful and specialized advisor planning trumps generic advice every day.  
  • Consumers will use tech. For years, I heard from advisors that their clients were uncomfortable using video calls, portals and other financial tech. In fact, in our Advisory Firms in 2030 innovation paper, our survey (436 advisors) showed that only 9% met with their clients virtually. After this is over, do you think your clients will fight traffic and look for parking just to meet you in person for their review meetings again? I doubt it.  
  • Workflows built into CRMs keeps everyone on track. When we were all forced to “shelter in place” who remembered to bring the ops manual?  How did you pass the travelling checklist of “to dos?” Advisory firms that had integrated workflows built into their CRMs have a distinct advantage over firms that rely on a key administrator or the capability of the founder’s memory.  In a remote environment, the CRM still remains as the hub of an advisor’s business — the workflows keep everything moving in the right direction with less chance of errors or dropping the ball.
  • Tech stack beats tech pile. Speaking of integrated systems, understanding how your systems all work together remotely has become more important than ever. Having your CRM talk to your trading platform and update your planning software helps to keep you and your clients on track. Going forward, I expect more advisors to really look at how all their unique software packages get used in a remote work environment versus what they have been doing in the past. 
  • Advisor revenue is down.  Working harder for less money – is this the catalyst for change in the industry?  Will more advisors (and more consumers) start to look at flat fee or retainer based compensation?  

We are not going back. Our theme in SEI’s practice management solutions is that this business is changing rapidly. Advisors are moving from an advisor-centric business, where the advisor picks the products, service model and compensation method to a consumer-focused model. The consumer is in charge and will not be going back. Co-planning and advice wins. Empathy wins. Integrating systems and workflows win.  Moreover, building a scalable office to help meet advisor needs will win.  

When we wrote Advisory firms in 2030, we suggested that firms will have to evolve by then or will quietly fade away. I think the time frame for change just got moved up.  

What have we learned so far?  Hopefully quite a lot.


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