91% of advisers likely to implement hybrid advice in the next 3-5 years
The in-webinar poll of nearly 260 attendees was one of three during the webinar, with other polls showing that 45% of advisers were with firms already heading down the hybrid route and 42% believed that hybrid advice would result in more advisers developing their knowledge and skills to a Level 6 qualification, as more advisers focussed on complex advice that required a human element, allowing technology to help progress clients’ more straightforward advice requirements.
Webinar panel participant Nick Hall, Head of Advice, Wealth Wizards, comments: “The poll results are very encouraging and reflect the level of traction that hybrid advice is gaining in the financial advice market. Hybrid advice blends the human touch with digitisation and automation, to create an advice experience the customer would want and expect from their advice firm, particularly following the pandemic where familiarity with digital has increased significantly.”
“It’s clear that both advisers and their clients are already on an advancing technological journey and the pandemic has pressed the accelerator on that change.”
Hall says there are four benefits for clients in delivering advice through a hybrid model.
1. Better engagement with the client - using techniques such as chat bots to help clients through the fact find and onboarding process and providing two-way communication with an adviser and with the advice firm’s brand 24/7.
2. Choice - UK consumers now want more choice as to the kind of assistance they want – basic help, guidance or full advice – and how they receive it. For example, if a customer wants to top-up their ISA and just wants some self-serve guidance, hybrid advice means they can get it as part of the adviser brand. It is a way to help narrow the Advice Gap.
3. Multi-channel approach - Hybrid advice should be about interaction whether through technology or a human adviser. If a customer wants to interact digitally in the evening or see an adviser face-to-face, there are different channels available through their financial advice firm.
4. Consistency. Algorithm logic provides a consistent approach throughout the advice process, aligning to the advice firm’s advice policy.
Hall says: “Where hybrid advice can deliver for financial advice firms is in taking on the heavy lifting of the advice process, allowing financial advisers to focus on the client relationship and the elements of advice that need human contact.”
“This makes use of customers self-serving and the automation of advice processes, letting the financial adviser talk to the customer when they want to and when needed.”
Hall continues: “The financial adviser is at the heart of the advice process; technology should be used to make advisers’ lives easier. It’s looking at the end-to-end process and seeing where technology can take on some of the heavy lifting – we’ve seen end-to-end processes in advice firms 35-50 hours to complete. Technology can cut that right down to sub-10 hrs.”
Heavy lifting can be separated into four elements, Hall says:
1. The onboarding process - “This should be a digital process, not a long-winded one for the customer to start engaging with you.”
2. The fact finding - “Customers can digitally complete the hard-facts, and do the hybrid/human part for the soft-facts, which are the dreams and aspirations of the customer.”
3. The diagnosis - “Every advice firm has an advice policy, a way they deal with various aspects of advice. Algorithms can be designed that match to the advice policy, meaning there is no longer a need to spend 4-7hours in diagnosis. An algorithm can align to the advice policy and the cashflow modelling, so ultimately that part is removed from the adviser’s task list. The adviser still has control over the process but consistency of approach is provided across the advice process and across the business.”
4. Suitability report writing. “Firms are spending up to 6-7 hours writing suitability reports. We have driven that down to 30-35 minutes, through using personal objectives that are keyed into the fact find. As you are talking to your customer the suitability report is being written behind the scenes. That’s how far technology has progressed.”
The end result of letting technology take the heavy lifting, in a real-world customer case study, has been proven to drive down the end-to-end advice process from 35 to nine hours, Hall adds.
“Hybrid advice provides for a better experience all round. For the customer, who feels the same pain-points in a process as the adviser, and for the adviser, who has more quality time building the relationship with the customer, focusing on client objectives and dealing with the more complex advice issues, as well as having their time freed up to see more customers.”
The full webinar is available to view here
If you'd like more information on digital and hybrid advice please email email@example.com
This article first appeared in Financial Reporter on 4th October 2021.