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Let’s have regular reviews, shall we?

October 27, 2022 BY Mike Coady 4 MIN READ

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We all know what a regular financial review is, right? It’s a staple of the advisory and wealth management business. Once a year, every six months, or once a quarter, financial advisers sit down with their clients and debrief them on how on target their portfolio is against objectives. What financial goals are being met? What potential changes might be recommended? Whether portfolios need to be adjusted or rebalanced? Financial market updates are imperative on an on-going basis.

It’s an excellent tool for building trust and transparency, and is part of industry best practice. So far so good.

But now, let’s talk about another type of review that is also exceptionally important, but sadly doesn’t happen with the same regularity or precision. I’m talking about an adviser’s work being reviewed regularly by team leaders and technical managers. This too should be an industry-wide standard, for a number of reasons. Financial market updates are important, but so is the standard of advice and service being provided!

First, managerial reviews are the norm in other knowledge and analysis-based industries. They’re also a very regular part of the financial world – such as in asset management and private equity, for instance. Second, reviews create a system of accountability – where there is an oversight that confirms that what advisers are recommending fit client goals. Reviews are also an excellent way of ensuring that individual advisers are following a company-wide ethos of transparency and ethical behaviour, and there are no vested interests at play.

Third, reviews like this help cure implicit biases – which we all have. We might prefer a particular sort of product or investment, and may tend towards recommending it even when the fit isn’t one hundred per cent right. A fresh pair of eyes cures these biases. Fourth, clients can rest assured that their hard-earned savings are being subject to not one but two or even three layers of analysis, governance and oversight. And finally, reviews are a learning opportunity. They create a culture of communication where ideas, best practice and new innovations are exchanged between professionals.

So why is this not the norm already? Where reviews feed into an overall strategy of supporting our team members while ensuring excellence and transparency in all we do. When it comes to the industry-wide picture, it’s not that professionals don’t want reviews, but that they sometimes fall through the cracks as people become preoccupied with other things. Reviews are not just about the financial market updates!

But it’s here that technology and digitalisation can lead the way in making this sort of best practice part of organisational DNA. If you have an integrated CRM powering your business, these reviews can be made part of the process – and as natural as getting a customer onboarded.

Here’s how it might work: customer reviews are fed into the CRM. So notes on client preferences and risk and reward parameters. Then, when an adviser creates his suitability report, that too is entered through the system. What if there were automated parameters based on risk-based advice that called for a review before the suitability report could be shared with a client? All it would take would be for that one extra step to become part of the value chain, and you could make sure no set of recommendations ever gets to a client without a pair of senior eyes to ensure its quality.

Of course, this calls for investment in technology, and a desire to introduce quality at every step of the process. For me, perfection in service delivery isn’t something to aspire to. It’s something that needs to be ingrained as a habit – because mistakes are far too costly to allow. As I have said, financial market updates are great, but it’s shouldn’t be the only “value add” you get from your financial adviser.