Asendium chief technology officer John De Angelis said financial planners are willing to automate their business to cope with compliance challenges and to increase efficiencies in the advice process but some misconceptions remain about what automation entails.
“The perception of what automation is can be confusing as some planners and licensees believe it removes the personalisation and that the technology is providing the advice to the client,” Mr De Angelis told ifa.
“The perception that automation will remove jobs is incorrect. The purpose of automation is to assist people with performing their jobs. Automation is assisting the planner to provide advice by automating the effort, not the advice. The latter is and will continue to be the value of the planner.”
Speaking ahead of the 2022 Adviser Innovation Summit on 1 June in Melbourne and 8 June in Sydney, Mr De Angelis urged planners to embrace automation, particularly as regulatory and industry requirements are “pushing planners into a corner” of either meeting those requirements or potentially exiting the industry.
Fear of change is another common challenge for planners automating their businesses, as many are managing an existing base of customers and focusing on retention, with minimal desire for new customers, Mr De Angelis said.
“These planners are happy with their current position and are not willing to scale,” he said.
“They are generally not willing to pursue change that could offer them more available time versus the risk of change disruption. Others do want to scale but are concerned with their internal ability to deliver this change.”
However, Mr De Angelis pointed out that the majority of other professional industries are already automating their businesses to improve their processes and profitability, and urged planners to follow suit for a more fruitful outcome.
“The same experience that planners are having right now with technology and automation is what confronted accountants when Xero entered the market. Look at the accounting industry now,” he argued.
He also underscored that “highly automated” does not equate to a cookie-cutter advice solution but would instead enable planners to enter data once and reuse it across documentation and reports, eliminating cutting and pasting.
It would also integrate and connect software platforms to seamlessly move data between them in all directions, removing the need to re-enter the same information into multiple systems and minimising human error.
“The financial planning business could see increased profitability due to advice being produced faster while still maintaining compliance and they will see a freeing up of time for team members to refocus their skillsets on more value-added services over manual processes,” he said.
On the other hand, robo-advice could be viewed as cookie-cutter advice because the advice itself would be predefined and coded into a system for a specific outcome, Mr De Angelis posited.
“Output which can lead to similar advice for similar client profiles is cookie cutting,” he said.
“But advice should always be tailored to the individual circumstances and their future needs, and these needs are infinitely different.”
During his session at the 2022 Adviser Innovation Summit, Mr De Angelis will explain the concepts of contextual versus quantitative data and structured versus unstructured data.
“The duplication and manual transfer of data is a result of unstructured data,” he said.
“We need to move towards structuring as much of the data as possible to leverage the benefits that automation can bring to a business.”
If all data was digitised and centralised on to the same platform, this would remove the pen, paper, excel, word, or any other disconnected technological tool that collects information, and would be defined as structured data.
“Once structured, it can be reused and analysed for insights,” he said.
Mr De Angelis urged industry suppliers and partners to focus on new approaches that provide risk mitigation for licensees and practices, while simultaneously considering who delivers the change, who pays for it and when, and how it is rolled out.
“There are a number of ways to better safeguard both businesses and supplier/partners, alleviate fear and deliver a win-win for all,” he concluded.
To hear more from John De Angelis about the future of automation, the benefits for licensees and financial planning practices, and what parts of the business could be automated (and what should not be), come along to the 2022 Adviser Innovation Summit in June.
Tickets are selling fast so click here to book your spot and make sure you don’t miss out!
For more information about the summit, including speakers and agenda, click here.
Advisers aren’t the ones holding the show up…..it’s ASIC that allowed AMP to become the major customer of software providers and stifled innovation in the sector.