Management systems introduced with RDR
Business management systems could soon become the norm, as the retail distribution review forces advisers to become more accountable, says IFA support provider Switch on Solutions.
Commenting on the increasing demand for advisers to understand their businesses and have client profitability statistics readily available, Martin Andrews, IFA and partner of Switch on Solutions, said recording day-to-day work could reap significant rewards. He said: "With the RDR, it seems that advisers will be required to have some sort of fee-based model and although many advisers will use a fund-based fee model, there is a great advantage to the adviser who knows exactly how much time he spends with each client and the type of work."
He added: "After just a few days, advisers and firms will start to benefit from valuable management information. This may prompt firms to further split their time between different types of client work and non-client work. For example, under the client work type you may wish to distinguish between administration and review work and for non-client work between compliance and training and competence."
Catering for the evolving needs of the adviser, the company has developed a client and business management software system tailored to IFAs. The software, known as Freedom, is available to IFAs on a sale or rental basis and records time, income and fees, payments to introducers and expenses such as mileage.
Commenting on the target audience, Mr Andrews said small firms stood to benefit: “It is aimed at smaller firms which can influence their own decisions quickly, but our largest firm has about 8 advisers so we are looking at the smaller end, but the smaller end goes up to a maximum of 15 advisers.”
However Euan Bottomly, director of Glasgow-based IFA Campbell Thomson, said: "We use our back-office system to confirm what we are doing with clients, so for example we would attach email work to the clients file and record interactions through that. Whilst we would not necessarily be measuring every aspect of our day, whatever related to a client would be attached to a clients' file."
He added: "I think if you are engaged by your client on the basis of a price for a job and they are expecting you to deliver a service. Unless the relationship is soured, I am not sure what extent they are going to measure on that. If you make a commitment to deliver a service and you deliver that then clients will see there is value in the charge."