Advisely’s Need for Speed report, based on the inaugural findings of the Advisely Index, found that Australia’s top-performing advice firms reported an average profit margin of 47 per cent before tax – 23.7 per cent more profitable than the benchmarked average.
Furthermore, these firms are serving 39.9 per cent more clients, with an average of 186.9 clients per full-time equivalent (FTE) adviser and are conducting 6.9 client meetings per adviser per week, one more than the benchmarked average.
Along with being more profitable and serving more clients, the report found that these top performers are “consistently more efficient than their peers at both advice document production and implementation”.
For example, top practices are producing basic statements of advice (SOA) 45.2 per cent faster than average practices, spending just 3.4 hours compared with 6.2, and are spending 47.5 per cent less time on complex SOAs, spending just 6.4 hours compared with 12.2.
Furthermore, these practices are producing strategy papers and reviewing documents around 1.6 times faster than the average, spending 1.7 and 1.1 hours, respectively.
In order to achieve greater efficiency, the advice profession has largely turned to technology in order to reduce man-hours needed to complete tasks, with SOAs being largely considered one of the more time-consuming tasks for advisers. As such, 86 per cent of advice practices report using software for SOA almost always.
However, technology can also be a hurdle for efficiency with more than half (56.4 per cent) of advisers using two or more different software platforms in their advice process and, as a result of using multiple, incompatible software platforms, four in 10 (44 per cent) report having to manually input the same data two or more times.
Kelli Willmer, Iress chief executive wealth APAC, said the findings show how technology can both help and hinder advisers.
“The Advisely Index results demonstrate that Australian advice businesses are drawing on technology and automation to streamline their internal processes and produce advice documents quicker,” Willmer said.
“While this is good news for the industry, there’s still a big opportunity to enhance efficiencies in the implementation of advice strategies, which could have significant impacts on the scalability and profitability of advice businesses.”
Willmer explained that Iress is steadfast in its commitment to finding new ways to improve adviser efficiency through its technology solutions, as well as exploring uses for AI to enhance automation and streamline workflows.
“We’re also focused on increasing the interconnectivity of our software with other technology, such as Docusign, to bring advisers the tools they need to seamlessly implement advice strategies,” she said.
Business Health principal Rod Bertino explained that advisers who are able to harness technology and improve efficiency are more likely to thrive in the highly competitive advice market.
“The trends in the Advisely Index data clearly show that advisers who can harness technology to drive consistent and efficient processes for advice production and implementation are more equipped to service a growing client landscape and likely to be more profitable than their peers,” Bertino said.
“Advisers are operating in an increasingly competitive market, making efficiency an imperative for any advice business looking to expand its client base and stay competitive in 2025 and beyond.”
