how windows 8.1 can help independent financial...

How Windows 8.1 can help Independent Financial Advisors

Microsoft UK, 2013

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A market in fluxThe Retail Distribution Review has changed the nature of the long-term savings market for good. The requirements for increased transparency and training from the Independent Financial Advisor (IFA) community and the removal of the conflict of interest between the IFA and client along with transparent, time-based costs, have changed the market. The IFA community continues to focus, at present, on the “at retirement” market. The bottom end of the market will be served by auto-enrolled NESTers, leaving a potentially lucrative middle market under-served. The FCA has already expressed concerns of the retrenchment of the banks and large IFA firms from this middle ground. But the truth is the banks fear conduct risk and further mis-selling scandals while for the IFAs the business is simply not profitable under existing processes and procedures.

To address this, financial product vendors are going back to direct sales forces and self-guided sales over the internet, either directly or via aggregators. The challenge for IFAs is how to attract these potential customers while better serving their core, high-value customer base. Simultaneously they must keep up with legislation, learn to market solutions and conduct business more efficiently. The vendors of financial products, meanwhile, are keen to regain touch with their customers, which for most means going online and recruiting and equipping their own sales forces. A combination of improved business processes, smart use of tablets for improved customer service and enhancements to the back office technology are all required if a profitable business can be built in the distribution of long-term savings products.

www.microsoft.com/uk/coit

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Irrevocable market change – and an opportunityRDR and its aftermath have irrevocably changed the business model of financial advice – from selling products for commission to selling advice by the hour.

After the fact find, profiling, risk assessment and initial product recommendations, how do you build a strong relationship? Technology can be a differentiator by showing how the advisor has all the information pertinent to his or her clients at their fingertips.

The good news is recent improvements in technology can help in a number of ways:• Windows 8.1 tablets and laptops come in a wide range of sizes and shapes to fit all requirements• Mobility – take your historic and new applications with you wherever you go • Windows 8.1 tablets run Excel, Outlook, PowerPoint and Word – tools used every day to manage client interactions• True security – hard disk encryption, VPN and Direct Access, remote wipe capabilities and device management and software management. While these may not sound sexy, the FCA will take a very dim view if you lose a device containing client data and you have not taken reasonable measures to secure the device and the data• Fast and effective CRM tools for managing long-term activities and interactions between a client and an advisor or back office, while remaining compliant and following transparent processes• Integrate information from a range of data sources, both internal and external to give a complete view of the client and their unique situation• Improved data analysis and analytics to segment and target specific clients with suitable offerings• Lync – an Internet Protocol (IP)-based instant messaging and telephony solution – can integrate with clients using Skype so you handle their calls personally


“Lync – an Internet Protocol (IP)-based instant messaging and telephony solution – can integrate with clients using Skype so you handle their calls personally”

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Maintaining long-term relationshipsThe metamorphosis of IFAs from sales to consultancy means servicing a long-term relationship, and not necessarily just by the lead advisor. A three-monthly courtesy call could be made by a more junior colleague, for example, while key life events such as marriage, house moves or having children could trigger different types of contact and interaction in the long and short term. Making sure that call gets made requires careful planning and a standardised, codified way of working that does not rely on the memory or actions of one individual.

Microsoft Dynamics CRM (customer relationship management) can supply that. It integrates easily with Microsoft Outlook and tracks emails, meetings and documents while driving a consistent approach to managing clients. It is a central repository for all client data, but also a solution platform and therefore a tool for managing the whole business. In a typical IFA firm it might support a dozen applications, often linked to discrete business processes, from client onboarding and billing to pipeline and sales management, payment tracking, internal workflow, service delivery management and supporting a self-service client website.

CRM also supports segmentation of the client base, highlighting the most profitable or promising clients and enabling the IFA to match the type and intensity of ‘touch’ to the client’s potential value.


“Microsoft Dynamics CRM integrates easily with Microsoft Outlook and tracks emails, meetings and documents while driving a consistent approach to managing clients”

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Getting out of the officePaying clients are demanding, and so is the environment in which IFAs must work. They are expected to set up shop in an instant, anywhere from the client’s office to the client’s kitchen table. And clients expect them to have accurate, up-to-date, aggregated information at their fingertips – literally. No embarrassed silences while they change a dying battery, or while an underpowered processor churns through calculations.

A lightweight Windows 8.1 tablet combines portability, connectivity and processing power in a single package that is perfect for face-to-face client interaction. A 3G connection means it is always online to the CRM and back-office systems for the latest information. It is engaging, too: just spin the tablet around and the customer can instantly see the information on-screen.

With Windows 8.1’s Live Tile interface, IFAs can shuffle different applications and information with ease, so that the right information is always to hand. There are apps that can bring up custom dashboards demonstrating the performance of different products, while a tablet with the power of a PC can run complex ‘what if?’ savings and investment scenarios before the client’s eyes in Excel. And Microsoft’s Lync 2013 unified communications platform enables the IFA to keep in touch with the office and clients via presence, instant messaging, voice, video and Skype.


“A lightweight Windows 8.1 tablet combines portability, connectivity and processing power in a single package that is perfect for face-to-face client interaction”

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Painless paperworkPaperwork and preparation are the bane of an advisor’s life. Preparation prior to a meeting is essential but this is unbillable time, so reducing this discovery time increases profitability. Even on-boarding of new clients, which should be fairly simple, now requires complex checking of background such as the Financial Sanctions Register.

Windows 8.1 devices and applications such as Microsoft Office can cut advance preparation time and enable data to be captured and forms completed at the point of advice, not scribbled down for later re-keying that is both error-prone and time-consuming. They also ensure that precious face-to-face time is spent understanding and satisfying the client’s needs rather than worrying about admin.

Electronic forms are flexible and can be adapted on the fly as more information is input. Thanks to Windows 8.1 connectivity and server integration, forms should always be the latest version and populated with current information, thus ensuring compliance and process standardisation. E-signatures mean the finished form need never be printed, and a copy can be emailed instantly to the customer.


“Thanks to Windows 8.1 connectivity and server integration, forms should always be populated with current information, thus ensuring compliance and process standardisation”

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Safety first – and lastClients are sharing highly confidential information with their IFA and trust is a cornerstone of their relationship. The Information Commissioner’s Office also takes a very dim view of organisations that mishandle customer data. Yet the media is full of horror stories of phones, computers and memory sticks containing confidential data that have been lost, stolen or left in the back of a taxi.

Anywhere, anytime availability appears to be directly at odds with the requirement to restrict access, and lock or remotely wipe any device that goes missing. But the circle can be squared. Windows 8.1 delivers enterprise-grade capabilities for end-to-end security. Direct Access, for example, allows authorised personnel to have secure, seamless access to data behind the corporate firewall, and enables in-house IT administrators to keep mobile devices updated and secure. BitLocker provides enterprise-grade data encryption, while Remote Wipe can erase all data on lost or stolen devices, and AppLocker can specify exactly who may run what application and on what file. While this is not the sexy end of tablets, if you lose client data on an unprotected device, then expect a substantial fine and bad publicity. Can you risk not having these capabilities?

Increased scrutinyCompliance is another non-negotiable, especially now that the FCA is as likely to investigate small IFAs as much as large institutions. This requires an audit trail of demonstrable compliance over the lifetime of the client relationship. Emails, meeting notes, fact-finds, risk assessments and other significant documents need to be stored and retrieved quickly. That is why data captured at the point of advice, and processes standardised through technology, are so important.


“Clients are sharing highly confidential information with their IFA and trust is a cornerstone of their relationship”

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“The FCA is casting its net wider and deeper, so managing the interaction with the regulator is more crucial now than at any time in the past”

Microsoft Dynamics CRM can help reduce compliance risk with workflow that enforces adherence to compliant processes. It can also ensure that all client conversations, decisions and transactions are recorded, stored and easily retrievable. What advice was the client given, and when? Did they provide an e-signature? Were they given a copy of the document? All these questions – and more – can be answered in timely and professional fashion. Moreover, many financial institutions now use CRM to manage their relationship with regulators themselves. The regulators are becoming a major stakeholder in your success. The FCA is casting its net wider and deeper, so managing the interaction with the regulator is more crucial now than at any time in the past.

Back at baseAn IFA practice or tied sales organisation requires a significant amount of processing capability in the back office to ensure everything is properly joined up. Automation and standardised, CRM-based workflow management ensure that key tasks are performed and key inputs received (such as actions or sign-off from multiple parties), and enable other staff to pick up on a job if the lead advisor is not available. Centralised process control also enables a new or updated process to be deployed throughout the business.

The goal is to deliver a service that appears tailored to the client but is delivered in a standardised manner. The trend is towards delivering this via low-cost, standardised services such as Microsoft Dynamics CRM, powering alerts and processes within Microsoft Outlook.


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The squeezed middleThe slimmed-down, tooled-up IFA profession will likely concentrate its efforts on high net worth individuals. Low earners will be encouraged to save through NEST via auto-enrolment. The middle income market, abandoned by the banks and unwilling to pay IFAs’ consultancy fees, will be left largely under-served.

Two very different approaches may result. First, insurance and pension vendors will create their own direct sales forces. Face-to-face meetings will be their main weapon, and like IFAs they will need state-of-the-art technology to prepare effectively beforehand and perform on the day. A Windows 8.1 tablet to display information and process ‘paperwork’, combined with secure, compliant back-office systems, will be a major asset.

Second, there will be an upsurge in self-service, web-based offerings, where middle income earners can access research and information, compare and purchase a range of products, and manage their own finances and track their investments. To succeed, many financial institutions will need to raise their game online, and follow the lead of sites such as moneyvista.com and moneydashboard.com, which have used Microsoft technologies to create a user experience on a par with the best consumer and retail websites.

Service propositions will also change. A light touch service delivered via the web in a scalable fashion can now be offered in a low-cost manner. One example may be to nudge the client to adding to their ISA saving scheme, or suggesting simple things such as nudging clients to save by cutting back on unnecessary expenses. This can only be accomplished profitably by using technology to solve the scale problem.


“The slimmed-down, tooled-up IFA profession will likely concentrate its efforts on high net worth individuals”

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Whatever the approach to the saving market, whether you are an IFA, a tied sales agent, an insurer or a bank, there are a few certainties. The model will change over the coming years. New service and sales models will be tried; some will work, some won’t. Flexibility will be key. Try something new, learn from it and iterate. Reduce risks and increase standardisation. All the large management consultancies sell their approach and framework as a way to differentiate themselves and ensure quicker delivery. The same approach needs to be taken within the financial services market. Technology is now pervasive in all our lives. It is not acceptable to turn up with pen and paper as that gives the wrong impression. Technology used correctly, integrating information and processes, can be a powerful selling tool for your business services.

Perhaps most importantly the vision outlined in the white paper above is possible today; all the technology to do this exists. However, this vision is perhaps further away from reality than many would be prepared to admit. The challenge with technology is that, while it solves complex problems for companies, the starting point for every business is different. This factor alone has the most impact on successful adoption, and this is where the opportunity lies. With organisations in the insurance sector set to change once more, those that understand their own business the best – and understand the nature of its change – stand to reap the benefits of the right technology applied to the right problems.


“Technology used correctly, integrating information and processes, can be a powerful selling tool for your business services”

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