Secrets of the top performing practices

Dimensional Fund Advisors head of adviser services Nathan Krieger told ifa the asset manager’s global adviser benchmark survey, conducted across 1,200 advice firms in markets including the US, UK and Asia, had revealed that technology, intergenerational advice and acquisitive growth were the top common themes that brought together high-performing firms.

“Consistently around the world we’re seeing the use of technology to improve systems is a key focus,” Mr Krieger said.

“I don't think that’s unique to any jurisdiction, but the higher quartile growth firms are showing in their technology spend that they are not only embracing the need to spend on technology, but the need to spend time implementing on technology.

“It’s not just about the tech, it’s about how do I get the most out of it and embed it in my business, rather than looking for the panacea.”

Mr Krieger added that high performing advice practices were also often making use of technology to engage the next generation, recognising that while Millennials may not be their ideal client base today, much of their funds under management was likely to walk out the door if they did not have a strategy to retain their clients’ children.

“Intergenerational wealth transfer and technology aren’t unrelated – some firms are being creative about using tech to connect with the next generation,” he said.

“They are thinking about the kids of the matriarch and patriarch. It might be an educational strategy, about providing information that is relevant to help those people make good decisions – they may not have big portfolio balances now, but they will certainly inherit some of that wealth.”

Further, Mr Krieger said despite the disruption of the COVID crisis globally, and regulatory change locally, advice businesses who had been disciplined and strategic during the upheaval were now reaping the benefits as their colleagues retired.

“We’re seeing a subset of clients that have had good growth in the last period of time,” he said.

“Some firms we work with have been clear about their proposition and bringing confidence and peace of mind to clients, and they’re now looking to acquire and see if there are opportunities with advisers exiting due to increased educational requirements.”