Spring has arrived, and with it the second edition of 64 Media’s Briefing Notes.
I spent last month in Sydney where the weather was kind and event season was in full swing. I attended the Financial Services Council’s Shaping Advice Summit and the Australian Wealth Management Awards – two very different events, both offering opportunities to do what I enjoy so much: catching up with people in the industry and listening to varied perspectives.
Perhaps unsurprisingly, I came home with many new insights. Some were sparked by the event conversations and presentations, others by things I’ve read or heard and, rather unexpectedly, some were prompted by something I found while sifting through a box of memorabilia.
But that’s what Briefing Notes is all about: taking note of the things that make us stop and think, looking at them from another point of view and seeing where those observations lead.
I hope you enjoy the read.
The bigger picture
A comment in a recent newsletter from The Advisers Association by CEO Neil Macdonald made me stop and think. Reflecting on Australia’s advice gap, he wrote about the collective responsibility to address it efficiently and cost-effectively, describing Australian financial services as a growing ecosystem rather than a battleground.
It’s an interesting way to look at an industry that necessarily spends a great deal of time thinking about growth and, like most other industries, competition. Businesses measure client numbers, funds under advice, market share, revenue, productivity and profitability. They watch competitors and look for opportunities to differentiate themselves. Of course that matters, obviously businesses do need to succeed.
But is there a risk that, amid the day-to-day and the microcosm of running individual businesses, the bigger picture sometimes gets obscured?
At the Financial Services Council’s recent Shaping Advice Summit, CoreData’s Andrew Inwood reminded us of the extraordinary numbers around that bigger picture – 4.49 million Australians want advice, current capacity is around 2.21 million, meaning 2.28 million or so people are going without it.
This is where Neil’s idea of collective responsibility comes into play. Different parts of the financial services ecosystem will inevitably compete and they absolutely should. But they also bring different capabilities, scale, technology, expertise and ways of delivering guidance and advice to the same much larger challenge. That’s why deliberately stepping outside the microcosm from time to time is so important.
Building capacity
AMAFA National Operations Manager Mario Finocchiaro recently talked about how advisers can increase their capacity to serve more clients in an opinion piece for IFA.
He suggested that when we think of capacity, we tend to think in terms of time constraints. How many clients can one adviser, or advice practice, reasonably serve, given how much other work is involved in the delivery of advice? He says perhaps the more useful question is: how much of an adviser’s working day is actually spent doing things that really need their expertise?
It’s a deceptively simple question.
Advisers inevitably spend time on administration, chasing providers, coordinating reviews, managing implementation and navigating the various processes involved in delivering advice. Mario’s argument is that identifying those friction points and using the right people and the right processes to remove them can create additional capacity without advisers having to work harder.
Recruiting more advisers to the industry must be part of the answer to the advice gap question. But Mario’s piece had me thinking about this other part of the equation – freeing advisers up so they are able to focus more of their time on giving advice.
If unmet demand is measured in the millions, perhaps finding even small amounts of additional capacity across the profession is more significant than it seems.
AMAFA is a 64 Media client. You can read Mario’s article HERE
What’s innovation (really)?
After our recent relocation to Melbourne, we did what millions of households have to do – set up the television. It shouldn’t be all that difficult. We have a smart TV, broadband, streaming services and access to more content than I can poke a stick at. But it was.
It made me nostalgic for a brief, apparently halcyon period in Australian TV history when you could do just that – turn on the telly and watch it. No signing into this and scanning QR codes for that so services could track and ‘tailor your advertising preferences’ either.
This was, admittedly, preceded by an era in which I had to ask my little sister to stand beside the television set on a Saturday morning holding the bunny ears aloft at precisely the right position so I could watch Countdown. So, let’s not get too carried away.
But the experience made me wonder about something we talk about constantly in financial services: innovation.
The government’s new Financial Innovation Strategy gives us an opportunity to think about what that word actually means. Assistant Treasurer and Minister for Financial Services Daniel Mulino made the point that innovation requires more than adopting new technology. It can encompass new products, services, business models and ways of working – with an important qualification: they should improve outcomes.
And there are times when innovation just doesn’t feel like it does that.
Often a business innovation reduces the provider’s costs. It can make a process more scalable. It can create valuable data. Sometimes it introduces functionality the customer never particularly wanted in the first place, while making the thing they did want a bit harder. And sometimes it transfers work that was once performed by the business to the customer. Think self-service checkouts. There can be a cost to the consumer attached to that – sometimes financial, more often in terms of time.
Innovation can make things faster, smarter, cheaper and more sophisticated. But does it genuinely make things better for the person using it?
Because sometimes, all you want to do is sit on the couch and watch the telly – without having to enlist your little sister.
The flip side
Before putting an opinion, idea or argument into the public domain, I often encourage clients to consider the equal and opposite point of view.
Take a deliberately crude example. You might argue there’s a lot to admire about ants. They’re great in the garden, helping to aerate and clean soil, and live in remarkably organised societies. Someone else might respond: Ants? Are you serious? What about fire ants? White ants? They’re pests!
The point isn’t that the first observation is wrong or shouldn’t be made. Nor does every possible objection need to be anticipated and addressed before making it. In fact, there’s a danger in going too far the other way, second-guessing every possible response can make people nervous about expressing an opinion at all.
The value is simply in looking at the argument from the other point of view before making it public. What might someone disagree with or challenge, and do you feel comfortable responding if they do?
Final sound check.
Have I considered the other point of view, without allowing it to silence mine?
Eighty-three per cent
Another thing relocation meant was sifting through boxes and boxes of memorabilia, trying to decide what to keep and what I could gracefully throw away. In one of these boxes, I rediscovered a short story I had written decades ago.
At the time, I was doing a short story writing course and had submitted it as an assignment. I received 83%. I know that’s a perfectly respectable score, but I remember being disappointed. However, I decided to enter it in a national short story writing competition anyway. It won first prize.
Finding it again all these years later reminded me that one person’s assessment of our work doesn’t determine its inherent worth.
But there was another little discovery in the box that pleased me almost as much. In that past life, I was a library technician and, along with three copies of the story and the assignment results, I’d kept a catalogue card recording when and where I’d submitted it, the competition details and, crucially, that I had retained copyright.
Thank you, younger me.
This means I can not only read it again, I can also, if I choose, publish it again. With the benefit of considerable hindsight, I discovered something else: it’s still a pretty good story. So, for your eyes only (at the moment anyway), if you’d like to read it, you can find it HERE.
A Sydney farewell
Our extended visit to Sydney last month also included attending the memorial for the late Glenn A. Baker.
Glenn’s send-off really was a celebration of life. Hundreds of people came together to remember him, with tributes from many of his family and friends, including his long-term partner and our close industry friend, Julia Newbould. There were also live musical performances from Leo Sayer, Ol’ 55, Melinda Schneider, Mark Gable and Paul Field.
I feel very fortunate to have known Glenn and Julia as a couple. They were warm and colourful, often seen together at music events, movie premieres and the theatre, usually on the red carpet.
Much has been written about Glenn’s extraordinary career, his encyclopaedic knowledge of rock music and his glorious collection of fezzes, but what I will always remember is his enthusiasm. He and Julia shared not only a great love of the performing and creative arts, they were also so kind towards the people who created them.
That warmth and generosity extended to my own work as an author. They both took such an interest in my writing and were always wonderfully encouraging. People like that are rare. So now seems like the right time to thank them both – and to say goodbye, Glenn. We’ll see you in our dreams.