12/30/2009
RAISING THE BAR
Advisor insists financial planning is a profession
Lenore Davis has her work cut out for her. A financial planner with Dixon Davis & Co., she was recently appointed president of the Institute of Advanced Financial Planners, replacing Scott Robertson.
Now, in addition to running her business and serving clients from her office in Victoria, Davis is charged with steering the organization that confers the registered financial planner designation — at a time when the financial services industry and the IAFP itself are facing declining numbers.
Davis’s approach to both tasks is driven by a commitment to the process of comprehensive financial planning. “I believe that financial planning is a profession,” she says, seated at a window table in a hotel lounge in London, Ont., the site of the IAFP’s annual conference. “The sales aspect is an industry.
”That distinction underlies the way Davis operates her practice and serves her clients. Davis, who holds both the RFP and certified financial planner designations, is a fee-only planner who provides advice but has no involvement in product sales.
Davis’s advice to clients covers the six general areas of financial planning: tax planning; cash-management planning; investment planning; retirement planning; risk management; and estate planning. Implementation of these components of the financial plan is up to the client. If the client doesn’t have relationships with advisors licensed to sell these products, Davis will refer the client to an appropriate specialist.
Davis doesn’t serve a particular professional or demographic niche. Her clients’ single common characteristic is a willingness to pay Davis a set fee and make Dixon Davis their No. 1 financial planner. “[Clients] have to believe in the process that Dixon Davis creates for them in the financial plan,” Davis says, “and be willing to follow it.
”Davis charges an hourly fee of $150. Alternatively, clients can choose to pay an annual retainer of $2,000, which covers approximately 15 hours of service in any area of financial planning. “We do income tax preparation for 90% of my clients,” she says. “We do counselling with the next generation, and we talk about education funding options. Any time [clients have] a question that relates to their financial health and well-being, they call me and they get an answer.
” Davis hopes to increase her client roster to 100 families — but no more — and is building her book mostly through referrals from existing clients. She also receives calls from prospects who have found her through Internet searches. Davis is listed on “find a planner” rosters on personal finance websites and the IAFP site.
Davis found her way into the fee-only model almost by accident. She began her financial services career in 1987 as a life insurance “salesman” — her word — with Mutual Life of Canada, now Sun Life Fi-nan-cial (Canada) Inc. She was licensed to sell life insurance, disability insurance and mutual funds, but found that occasionally clients would ask questions for which Davis’s answers didn’t involve a sale.
One client engaged Davis for some extensive advice that included guidance on tax planning. At one point, the client said: “You’ll send me a bill for this, won’t you?”
“And I thought, ‘Jeez, that’s an idea’,’ Davis recalls. “I scratched something on a piece of paper, and she paid it.
”Davis has never looked back. In 1988, she formed Dixon Davis, a partnership with Howard Dixon, then a colleague at Mutual Life, who eventually became Davis’s husband in 1994. The couple ran their fee-only planning firm as a separate entity while still working as agents with Mutual Life until 1998. Then, they severed ties with the insurer and made fee-only planning their full-time occupation.
Dixon has recently retired and now teaches a financial planning course at University of Victoria. He often makes a “guest appearance” in the Dixon Davis office to lend a hand at tax time. Meanwhile, Davis, 56, runs the firm with the help of Margie Parikh, who is learning the profession under Davis’s mentorship. Parikh is also taking formal training at the University of Victoria toward a diploma in financial planning, with plans to work toward a CFP designation and an RFP. Sounds like a succession plan, but Davis is noncommittal: “We’re discussing that.”
Succession is a concern that extends throughout the financial services industry, and with the national firms and independent advisors looking for new advi-sors to carry the torch, the IAFP is looking for new members. The institute has slightly fewer than 400 members, and its ranks are declining as members age and retire. The group includes many advisors who are with such firms as Investors Group Inc. and Assante Financial Management Ltd. “But they’re all getting old,” Davis says with her characteristic frankness. “We need the younger ones to come on.
”The IAFP itself is relatively young. It was founded in 2002, when the Canadian Association of Financial Planners, which then conferred the RFP designation, merged with the much larger Canadian Association of Insurance and Financial Advisors. The merger would have eliminated the RFP were it not for a group of planners who founded the IAFP to preserve that designation, which, they believe, is unique in representing the standard of comprehensive financial planning.
The IAFP has been using a recruitment strategy that depends largely on word of mouth, according to Davis: “We need existing RFPs to talk to the person at the desk next to them and explain why they should join the profession.”
Running her practice and directing the IAFP isn’t going to leave much spare time, but Davis has always lived a balanced life. She plays golf and a cricket, a sport at which she has represented Canada at the international level. When it’s time to kick back, she likes a good novel, particularly British crime stories by authors such as P.D. James and Ian Rankin, and Davis especially enjoys the work of CanLit icon Robinson Davies. She admits to being an “incurable Trekkie.
”Born in Victoria, Davis moved frequently as a child; her father’s work with B.C. Hydro took the family “all over the province.” Davis returned to Victoria in 1984, and has no plans to move: “The keg of dynamite that blew me out of Victoria would have to be big enough to blow me over to Nova Scotia.”
By Grant McIntyre
Investment Executive
12/07/2009
ACUTE AWARENESS - A PRESCRIPTIVE SOLUTION TO SHORTFALLS IN RETIREMENT OR ANYWHERE ALONG THE WAY
For those seeking professional financial retirement advice Weigh House Investor Services is the Canadian investor’s best source for unbiased, common sense advice. A unique advice channel is offered for a new breed of investor looking for:
- Objective counsel, untainted by industry biases and conflicting interests;
- Greater transparency and accountability in their advisory relationship;
- Clear presentation of investment returns, fees and commissions;
- Enhanced understanding of investment fundamentals; and,
- Greater control of their financial security.
For more detail visit: www.weighhouse.com
12/27/2009
SOLVING INVESTMENT PERFORMANCE PROBLEMS WITHOUT SELLING INVESTMENTS
This is what Weighhouse Investor Services does:
"We do not sell or manage investments; rather, we employ proven strategies utilized by institutional money managers to strengthen your portfolio, improve your financial posture, and help you achieve your lifestyle goals with minimal risk.
Without incentives to sell investments, we work only for you. We keep your interests front and centre as you transition through life’s significant events. As true independents, we are free to tell the truth and this is our enduring promise to you."
COMPREHENSIVE FINANCIAL PLANNING VS FINANCIAL PRODUCT SALES
- Comprehensive Financial Planning is a profession.
- Financial product sales is an industry.
The distinction is vital in the matter of intent.
The first is shareholder value.
The second is client centric professional service.
12/25/2009
WEIGH HOUSE INVESTORS SERVICES INC - INVESTMENT EXECUTIVE - CANADA’S NEWSPAPER FOR FINANCIAL ADVISORS - FEATURE ARTICLE JANUARY 2010
Weigh House focuses on fee-only model
With potential regulatory changes in Australia and Britain that could result in the elimination of commission-based selling by 2012, a Toronto-based planning firm is positioning itself for the day that trend hits Canada. Weigh House Investors Services Inc. is aiming to become a leader in fee-only financial planning.
With potential regulatory changes in Australia and Britain that could result in the elimination of commission-based selling by 2012, a Toronto-based planning firm is positioning itself for the day that trend hits Canada. Weigh House Investors Services Inc. is aiming to become a leader in fee-only financial planning.
Investment Executive in a feature article on Weigh House Investors Services had the following comments:
Warren MacKenzie, President and CEO of Toronto based Weigh House Investors Services Inc., and Clive Smith, the firm’s vice president of business development anticipate growth in demand for fee-only financial planning services. With 14 consultants in 12 offices, the executives plan to expand to 250 advisors across Canada. “Right now it is almost like a perfect storm for our business,” Mackenzie says.
MacKenzie sees demand among investors for third party consulting on their investments.
“Canadian investors are overwhelmed and disillusioned by the complex array of investment products being sold today, MacKenzie says. There is a very real need for expert investment advice that is sheltered from marketplace incentives, product development and sales targets."
Warren MacKenzie, President and CEO of Toronto based Weigh House Investors Services Inc., and Clive Smith, the firm’s vice president of business development anticipate growth in demand for fee-only financial planning services. With 14 consultants in 12 offices, the executives plan to expand to 250 advisors across Canada. “Right now it is almost like a perfect storm for our business,” Mackenzie says.
MacKenzie sees demand among investors for third party consulting on their investments.
“Canadian investors are overwhelmed and disillusioned by the complex array of investment products being sold today, MacKenzie says. There is a very real need for expert investment advice that is sheltered from marketplace incentives, product development and sales targets."
For a pdf copy of the entire article kindly email your request to me at:
LinkedinDanZwicker@rogers.com
I’ll get it out to you as soon as I receive your request.
LinkedinDanZwicker@rogers.com
I’ll get it out to you as soon as I receive your request.
Dan Zwicker
SOCIAL MEDIA ENGAGEMENT INTENT - SOCIAL vs COMMERCIAL
The value proposition with regard to 'Relationship Engagement' in Social Media , in my opinion, is an offer of leadership one-on-one. Social Engagement derives from the use of 'Social Relationship Marketing' through acts of leadership for the sole purpose of serving the greater good. Leadership itself is free - it is a social relationship. When, and if, individuals choose to act on a value proposition delivered in a leader's message it may become a commercial 'engagement' at the choice of the individual. That's my take on the difference between Commercial Engagement Marketing and Social Relationship Marketing. There is no commercial intent in Social Relationship Marketing. It is an act of 'giving'.
CREATING SOCIAL MEDIA VALUE - WHAT IS YOUR INTENT?
The term engagement is being used to frame how brands can use the social web to engage their audience. On the other side of the term “engagement” is methods used by people to engage people in relevant and relative conversations. So on one side of the term engagement we have marketers and on the other side we have people.
What Kind of Engagement?
The term engagement, used as a noun, means:
an appointment or arrangement
A pledge; an obligation or agreement
an encounter, conflict or battle
Given these definitions one must wonder which type of engagement do people and organizations seek. As marketers continue to use the term “engagement” and use the social web to do so the question on most people's mind is “an engagement for what?”. An appropriate question we ought to ask.
Is it Engagement Marketing?
Everyone seems to be using social media as a marketing tool rather than a relational tool. There is a big difference between the two. “This is the way things are going, says Netscape founder Marc Andreessen. “Banner ads aren’t going to cut it,” he says. “And media companies have not been creative or aggressive about making products designed for engagement marketing. Now that’s changing, giving brand advertisers a new way and reason to buy.”
While the social web certainly enhances the practices of marketing most individuals using the web aren’t looking for marketing messages rather the intent of using the web is to find or create value. Now that doesn’t mean the offerings being pushed out in “social messages” don’t offer value rather it means that relational messages get better responses than marketing messages.
What Is The Intent of Engaging?
Marketing methods of the past reflected the process of deliberately enticing a person to engage in some sort of exchange, buy this. The social web has become the place by which people and organizations try and seduce us into an exchange. The word seduction stems from Latin and means literally “to lead astray.”
Most people would tell you that the purpose of engaging with others is to converse, learn and get to know one another. That being said just maybe the real value that can be created by using social media is to “converse, learn and be relational”. The problem is that most business mindsets do not think in terms of relational rather they think in terms of results.
On-line and off-line success comes from serving the interest of others.
Results come from service.
There is plenty of opportunity to serve if you are listening and learning correctly. To serve however you must have a presence which reflects your intent in the marketplace waiting to be served.
How Do You Measure Intent?
Engaging in the marketplace of conversations has become main stream, expected and simply the new market of how markets should operate. Since the process is still new many are trying to apply old methods and old thinking with the ability to engage with many for difference purposes. Markets are now trying to measure the benefit of engagement and screaming for an ROI on the investment of time and expense.
The irony of current behaviors is that the intent is transparent. Marketers want to produce results from us and don’t realize how transparent their intent is to the new marketplace. Intent is the real measurement of effective engagement and the measure of intent is reflected by how well you serve the market of interest.
How would you measure intent?
The Relationship Economy, Jay Deragon
12/24/2009
What Kind of Engagement?
The term engagement, used as a noun, means:
an appointment or arrangement
A pledge; an obligation or agreement
an encounter, conflict or battle
Given these definitions one must wonder which type of engagement do people and organizations seek. As marketers continue to use the term “engagement” and use the social web to do so the question on most people's mind is “an engagement for what?”. An appropriate question we ought to ask.
Is it Engagement Marketing?
Everyone seems to be using social media as a marketing tool rather than a relational tool. There is a big difference between the two. “This is the way things are going, says Netscape founder Marc Andreessen. “Banner ads aren’t going to cut it,” he says. “And media companies have not been creative or aggressive about making products designed for engagement marketing. Now that’s changing, giving brand advertisers a new way and reason to buy.”
While the social web certainly enhances the practices of marketing most individuals using the web aren’t looking for marketing messages rather the intent of using the web is to find or create value. Now that doesn’t mean the offerings being pushed out in “social messages” don’t offer value rather it means that relational messages get better responses than marketing messages.
What Is The Intent of Engaging?
Marketing methods of the past reflected the process of deliberately enticing a person to engage in some sort of exchange, buy this. The social web has become the place by which people and organizations try and seduce us into an exchange. The word seduction stems from Latin and means literally “to lead astray.”
Most people would tell you that the purpose of engaging with others is to converse, learn and get to know one another. That being said just maybe the real value that can be created by using social media is to “converse, learn and be relational”. The problem is that most business mindsets do not think in terms of relational rather they think in terms of results.
On-line and off-line success comes from serving the interest of others.
Results come from service.
There is plenty of opportunity to serve if you are listening and learning correctly. To serve however you must have a presence which reflects your intent in the marketplace waiting to be served.
How Do You Measure Intent?
Engaging in the marketplace of conversations has become main stream, expected and simply the new market of how markets should operate. Since the process is still new many are trying to apply old methods and old thinking with the ability to engage with many for difference purposes. Markets are now trying to measure the benefit of engagement and screaming for an ROI on the investment of time and expense.
The irony of current behaviors is that the intent is transparent. Marketers want to produce results from us and don’t realize how transparent their intent is to the new marketplace. Intent is the real measurement of effective engagement and the measure of intent is reflected by how well you serve the market of interest.
How would you measure intent?
The Relationship Economy, Jay Deragon
12/24/2009
12/24/2009
SOCIAL MEDIA - TRADITIONAL vs. RELATIONSHIP MARKETING
Here are my observations on the role Social Media is playing at this time.
Traditional "push" marketing is losing its constituency. Consumers simply do not want to be sold.
They are reaching out to one another on SM platforms such as Facebook, Linkedin and Twitter.
They are seeking to engage with individuals with whom they have something in common.
If their connection with one another is compatible then an opportunity to establish a genuine bond exists. If the communication and chemistry is meaningful then a trust relationship can follow.
I believe that compatibiity, complementary interests, friendship and trust are key incentives for the widespread growth of SM in all its forms.
SM is premised upon our capacity and skill in managing relationships.
An essential skill in using SM effectively is our ability to engage others.
The engagement process is, in my experience, an act of leadership one-on-one. I have been in an industry for 30 years where the consumer need is 100% and the demand is zero.
This circumstance does not encourage "push" marketing. It does allow for relationship - i.e., engagement marketing.
The contemporary consumer's demand for traditional "push" marketing has been significantly reduced.
In my view this has been a key catalyst for the extraordinary growth in the use of Social Media platforms.
They allow us to make available our personal value propositions whether social or commercial through personal acts of leadership - for the greater good
I believe SM is here to stay and will flourish.
Traditional "push" marketing is losing its constituency. Consumers simply do not want to be sold.
They are reaching out to one another on SM platforms such as Facebook, Linkedin and Twitter.
They are seeking to engage with individuals with whom they have something in common.
If their connection with one another is compatible then an opportunity to establish a genuine bond exists. If the communication and chemistry is meaningful then a trust relationship can follow.
I believe that compatibiity, complementary interests, friendship and trust are key incentives for the widespread growth of SM in all its forms.
SM is premised upon our capacity and skill in managing relationships.
An essential skill in using SM effectively is our ability to engage others.
The engagement process is, in my experience, an act of leadership one-on-one. I have been in an industry for 30 years where the consumer need is 100% and the demand is zero.
This circumstance does not encourage "push" marketing. It does allow for relationship - i.e., engagement marketing.
The contemporary consumer's demand for traditional "push" marketing has been significantly reduced.
In my view this has been a key catalyst for the extraordinary growth in the use of Social Media platforms.
They allow us to make available our personal value propositions whether social or commercial through personal acts of leadership - for the greater good
I believe SM is here to stay and will flourish.
THE CASE FOR A PERIOD OF GROUND - SHAKING CHANGE
"The transformation from traditional "push" marketing to Relationship "pull" marketing.
The key value added skill - the capacity to engage - an act of leadership - one on - one."
LI group owner note
Dan Zwicker
"Embrace the transformation by discarding the business models of the past"
by Dan Richards, MBA President of Strategic Imperatives Corp. in Toronto
"I have been a participant in and an observer of the Canadian investment industry for more than 20 years. At no time can I recall anything approaching today’s level of angst about the future. Part of that relates to investor discontent arising from last year’s stock market collapse."
"In reality, we’re dealing with a more fundamental issue than the recent market turmoil. In fact, a case can be made that we’re going through one of those rare periods of ground-shaking change that have taken place throughout history — something that was in the works well before the market excitement of the autumn of 2008."
"Biologists refer to a concept called “punctuated equilibrium.” The core idea is that while change is a constant, the pace of change isn’t. For millennia, species have gone through centuries of slow, almost imperceptible change, interspersed with periods of incredibly rapid and intense shifts."
"The same phenomenon has taken place throughout human history."
"For example, in 1800, Napoleon’s troops travelled using roughly the same technology and at approximately the same speed as Caesar’s army almost 2,000 years earlier. By 1850, railways had changed how armies travel forever."
"A case can be made that the investment industry — and practically every other industry — is going through that same sort of epochal transformation, in which all the traditional rules of the game are out the window."
More Demanding Customers
"A few common patterns are driving these changes."
"First and foremost are brutally demanding, intensely value-focused customers. Today, providing tepid value means you’re toast."
"When I interviewed investors 20 years ago, the decision concerning their advisor was typically driven by historical relationships. Back then, I heard investors say: “It may have taken my advisor a while to win me over, but now that I’ve started working with him, I’m going to stay unless he gives me a reason to go."
”Now, I hear an entirely different story. Today, investors say: “I may have worked with my advisor for 10 years or longer, but I’m going to go unless she gives me a reason to stay."
”The change in the driver of decision-making from yesterday’s relationship to today’s value has transformed industry after industry. Look no further than the automobile: in the 1960s, loyalty ruled the day and men proudly branded themselves as “Ford buyers” or “GM buyers.”
Technology And Global Competition
"Today’s vigilante customer is empowered to wreak havoc on traditional business models by intense local competition, technology beyond most of our wildest imaginings just 20 years ago and, in many industries, a new breed of aggressive, global competitor."
"In the financial services industry, many of the clearly defined parameters that existed in the past have disappeared."
"In part, this has been accelerated by the Internet, which has levelled the information playing field and shifted the balance of power from producer to customer. At the same time, processing power has allowed an unparalleled level of complexity in design and manufacturing."
"In the investment industry, technology has led to 24-hour trading, with the ability to buy and sell stocks at sliver-thin price differentials. And technology has also led to innovative new products such as exchange-traded funds, not to mention vehicles such as incredibly complex derivatives that would have been unimaginable 20 years ago."
Two Key Questions For Your Business
"The one element that will, more than anything else, define tomorrow’s winners is the ability to demonstrate compelling, discernible value. That’s true of manufacturing, retailing and financial advice."
"Many financial advisors recognize that the traditional business model is being seriously challenged. What is less clear is what will replace it. In my view, there will not be just one successful model; there will be a variety of approaches. The one thing they’ll have in common is a clearer and higher standard of value than existed in the past."
"As you think about where you’re going to take your business in 2010 and beyond, you need to answer two key questions:"
"First, what will be your response if a prospective client asks: “What’s the unique value that you provide to your clients?”
"It’s a cliché to say that, not long ago, investors paid for transactions and access to information and got advice for free. Today, more and more investors see transactions and information as commodities; the only thing left for advisors to charge for is superior advice, a sensible plan and effective, ongoing communication around that plan. In some cases, the plan focuses on investment or insurance advice alone. In others, advisors also provide a broad range of advice on wealth issues such as tax planning and charitable giving."
The second question: “How do you deliver that value?”
"Begin by summarizing all the time and money you spent on your business this past year. Then identify those expenditures that are the cost of doing business; customers aren’t prepared to pay the cost of keeping the lights on, so you need to keep these to a minimum."
"Everything else falls into two categories: “good expenditures” of time and money that translate into clear perceived value for clients; and “bad expenditures” that don’t. Your goal is to maximize the good and minimize the bad."
"Dividing everything you do into those categories can be an arduous process. But it can also be an illuminating one that will clarify how you can maximize the value you deliver to your clients."
Getting From Here To There
"The last item relates to the pace of change."
"It’s human nature to resist change and, even if we accept that change is coming, to believe that it’s in the distant future rather than around the corner."
"In The Origin of Species, Charles Darwin wrote: “It is not the strongest of the species that survives, nor the most intelligent that survives. It is the one that is the most adaptable to change."
"Time and again, we’ve seen change crawl along agonizingly slowly, only to suddenly pick up pace and assume a life of its own. Consider how unrest about life in the former Soviet satellites bubbled along beneath the surface for decades – only to surface in November of 1989, with the result that the Soviet bloc collapsed almost overnight."
"Or look at more germane examples, such as the implosion of technology stock valuations in 2000 or the collapse of the U.S. real estate market in 2007 and 2008. Many investors who had made early bets got discouraged while waiting for things to happen and some lost their resolve. Even if you had predicted the trend correctly, you had to hang in there, waiting for events to take shape."
"Chances are the same will apply to getting the payoff from making changes to ramp up your value to clients and position your business for the future. Just remember: the day you say that change is inevitable and it’s a matter of when, not if, that’s the day that you need to be prepared for change to come faster and harder than anyone thinks possible."
"Whenever you see changes coming down the pike at the magnitude we see today, there will inevitably be winners and losers. The only way to guarantee that you’ll be on the winning side of the equation is to be willing to embrace change by discarding business models of the past in favour of new business models of the future."
"Painful as it might be to make that transition, most successful advisors today are still operating from a position in which their businesses are reasonably healthy and they have some flexibility regarding how and when to make changes."
"Once change starts accelerating, time is not your friend. In the words of French author Victor Hugo: “There is nothing more powerful than an idea whose time has come.”
"If you wait, you risk being forced to make changes from a position of weakness with limited options, as traditional powerhouses such as the U.S. automakers have discovered. While making changes today can be uncomfortable, it will almost certainly be much more painful if left until tomorrow."
From The Investment Executive 12/04/2009
by Dan Richards, MBA President of Strategic Imperatives Corp. in Toronto.
The key value added skill - the capacity to engage - an act of leadership - one on - one."
LI group owner note
Dan Zwicker
"Embrace the transformation by discarding the business models of the past"
by Dan Richards, MBA President of Strategic Imperatives Corp. in Toronto
"I have been a participant in and an observer of the Canadian investment industry for more than 20 years. At no time can I recall anything approaching today’s level of angst about the future. Part of that relates to investor discontent arising from last year’s stock market collapse."
"In reality, we’re dealing with a more fundamental issue than the recent market turmoil. In fact, a case can be made that we’re going through one of those rare periods of ground-shaking change that have taken place throughout history — something that was in the works well before the market excitement of the autumn of 2008."
"Biologists refer to a concept called “punctuated equilibrium.” The core idea is that while change is a constant, the pace of change isn’t. For millennia, species have gone through centuries of slow, almost imperceptible change, interspersed with periods of incredibly rapid and intense shifts."
"The same phenomenon has taken place throughout human history."
"For example, in 1800, Napoleon’s troops travelled using roughly the same technology and at approximately the same speed as Caesar’s army almost 2,000 years earlier. By 1850, railways had changed how armies travel forever."
"A case can be made that the investment industry — and practically every other industry — is going through that same sort of epochal transformation, in which all the traditional rules of the game are out the window."
More Demanding Customers
"A few common patterns are driving these changes."
"First and foremost are brutally demanding, intensely value-focused customers. Today, providing tepid value means you’re toast."
"When I interviewed investors 20 years ago, the decision concerning their advisor was typically driven by historical relationships. Back then, I heard investors say: “It may have taken my advisor a while to win me over, but now that I’ve started working with him, I’m going to stay unless he gives me a reason to go."
”Now, I hear an entirely different story. Today, investors say: “I may have worked with my advisor for 10 years or longer, but I’m going to go unless she gives me a reason to stay."
”The change in the driver of decision-making from yesterday’s relationship to today’s value has transformed industry after industry. Look no further than the automobile: in the 1960s, loyalty ruled the day and men proudly branded themselves as “Ford buyers” or “GM buyers.”
Technology And Global Competition
"Today’s vigilante customer is empowered to wreak havoc on traditional business models by intense local competition, technology beyond most of our wildest imaginings just 20 years ago and, in many industries, a new breed of aggressive, global competitor."
"In the financial services industry, many of the clearly defined parameters that existed in the past have disappeared."
"In part, this has been accelerated by the Internet, which has levelled the information playing field and shifted the balance of power from producer to customer. At the same time, processing power has allowed an unparalleled level of complexity in design and manufacturing."
"In the investment industry, technology has led to 24-hour trading, with the ability to buy and sell stocks at sliver-thin price differentials. And technology has also led to innovative new products such as exchange-traded funds, not to mention vehicles such as incredibly complex derivatives that would have been unimaginable 20 years ago."
Two Key Questions For Your Business
"The one element that will, more than anything else, define tomorrow’s winners is the ability to demonstrate compelling, discernible value. That’s true of manufacturing, retailing and financial advice."
"Many financial advisors recognize that the traditional business model is being seriously challenged. What is less clear is what will replace it. In my view, there will not be just one successful model; there will be a variety of approaches. The one thing they’ll have in common is a clearer and higher standard of value than existed in the past."
"As you think about where you’re going to take your business in 2010 and beyond, you need to answer two key questions:"
"First, what will be your response if a prospective client asks: “What’s the unique value that you provide to your clients?”
"It’s a cliché to say that, not long ago, investors paid for transactions and access to information and got advice for free. Today, more and more investors see transactions and information as commodities; the only thing left for advisors to charge for is superior advice, a sensible plan and effective, ongoing communication around that plan. In some cases, the plan focuses on investment or insurance advice alone. In others, advisors also provide a broad range of advice on wealth issues such as tax planning and charitable giving."
The second question: “How do you deliver that value?”
"Begin by summarizing all the time and money you spent on your business this past year. Then identify those expenditures that are the cost of doing business; customers aren’t prepared to pay the cost of keeping the lights on, so you need to keep these to a minimum."
"Everything else falls into two categories: “good expenditures” of time and money that translate into clear perceived value for clients; and “bad expenditures” that don’t. Your goal is to maximize the good and minimize the bad."
"Dividing everything you do into those categories can be an arduous process. But it can also be an illuminating one that will clarify how you can maximize the value you deliver to your clients."
Getting From Here To There
"The last item relates to the pace of change."
"It’s human nature to resist change and, even if we accept that change is coming, to believe that it’s in the distant future rather than around the corner."
"In The Origin of Species, Charles Darwin wrote: “It is not the strongest of the species that survives, nor the most intelligent that survives. It is the one that is the most adaptable to change."
"Time and again, we’ve seen change crawl along agonizingly slowly, only to suddenly pick up pace and assume a life of its own. Consider how unrest about life in the former Soviet satellites bubbled along beneath the surface for decades – only to surface in November of 1989, with the result that the Soviet bloc collapsed almost overnight."
"Or look at more germane examples, such as the implosion of technology stock valuations in 2000 or the collapse of the U.S. real estate market in 2007 and 2008. Many investors who had made early bets got discouraged while waiting for things to happen and some lost their resolve. Even if you had predicted the trend correctly, you had to hang in there, waiting for events to take shape."
"Chances are the same will apply to getting the payoff from making changes to ramp up your value to clients and position your business for the future. Just remember: the day you say that change is inevitable and it’s a matter of when, not if, that’s the day that you need to be prepared for change to come faster and harder than anyone thinks possible."
"Whenever you see changes coming down the pike at the magnitude we see today, there will inevitably be winners and losers. The only way to guarantee that you’ll be on the winning side of the equation is to be willing to embrace change by discarding business models of the past in favour of new business models of the future."
"Painful as it might be to make that transition, most successful advisors today are still operating from a position in which their businesses are reasonably healthy and they have some flexibility regarding how and when to make changes."
"Once change starts accelerating, time is not your friend. In the words of French author Victor Hugo: “There is nothing more powerful than an idea whose time has come.”
"If you wait, you risk being forced to make changes from a position of weakness with limited options, as traditional powerhouses such as the U.S. automakers have discovered. While making changes today can be uncomfortable, it will almost certainly be much more painful if left until tomorrow."
From The Investment Executive 12/04/2009
by Dan Richards, MBA President of Strategic Imperatives Corp. in Toronto.
12/22/2009
A MEDICAL ANALOGY - OUR HEALTH - PHYSICAL VS FINANCIAL
Why is there a diabetes epidemic among young and old?
Why is there a pending "impoverished retirement income" epidemic among retiring boomers?
The following is a personal story that may shed some light on the answer to both questions.
Four months ago during a routine medical examination my physican and I were discussing my numbers and I asked him why there was a diabetes epidemic and he in turn asked me if I would like to learn why the epidemic in diabetes exists. I said I would like to know. I told him my father in law was in palliative care as a direct result of diabetes. He said that he would enroll me in a diabetes education session given by our hospital - 2 sessions for 3 hours each. That was in August 2009.
Within the first hour what I heard was a lifestyle changing explanation simply describing the reason we have an epidemic. It was lifestyle changing because I concluded that we cannot make a rational case for carrying 25 - 30 pounds of excess weight on our bodies. I decided to reduce the body's demand for glucose by removing the cells which in large measure create the demand.
4 months later here are the stats:
40 pounds lighter.
Blood glucose in the low end of the ideal range.
Cholesterol in the low end of the normal range.
Blood pressure in the low end of the ideal range.
The solution included:
Disciplined diet
Daily exercise - 2 miles
Disciplined daily focus on the #'s
Conclusion:
What was lifestyle changing was my acute awareness of what causes diabetes - and what we can choose to do about it. It was a choice because I had no threat that was imminent.
Here is what I learned:
As we grow older the pancreas, the organ that provides insulin to carry glucose in our blood vessels to the cells in our body which require energy - slows down. It simply does not produce enough insulin to get the glucose to where it is needed. It accumulates in our blood vessels and one day our physician announces "You have diabetes!".
It happens over time because we eat as we always have without realizing that the insulin producing motor is not keeping up with its job. They call it a silent killer.
None of the above is new. But for whatever reason the public does not internalize the significance on our life and our lifestyle.
Here is what I did - immediately.
I lost weight based upon my own self imposed diet
I began doing a 2 mile lap daily.
I measured the results daily.
I feel energized and relaxed and grateful to my physician.
Here is the connection with the impoverisation of our retirement income.
We live our daily economic lives very much by habit. One economic habit is our minimal savings for retirement. We don't change our economic habits for the same reason we don't change our eating habits to avoid diabetes. There does not appear to be an imminent financial threat.
One day a financial physician announces that "Your 30 - 40 year lifestyle may be less than 'golden'".
The solution is identical - awareness.
The requirements are identical - disciplined and applied focus.
The professional source of guidance and expertse that is necessary is identical - client centric professional expertise - i.e. financial phyicians
That is what we do.
The problem in health be it physical or financial is identical.
We must be aware - it must matter - we must choose to act. It is our choice.
Our professional lives are devoted to making it happen.
We wish you success.
Dan Zwicker.
Why is there a pending "impoverished retirement income" epidemic among retiring boomers?
The following is a personal story that may shed some light on the answer to both questions.
Four months ago during a routine medical examination my physican and I were discussing my numbers and I asked him why there was a diabetes epidemic and he in turn asked me if I would like to learn why the epidemic in diabetes exists. I said I would like to know. I told him my father in law was in palliative care as a direct result of diabetes. He said that he would enroll me in a diabetes education session given by our hospital - 2 sessions for 3 hours each. That was in August 2009.
Within the first hour what I heard was a lifestyle changing explanation simply describing the reason we have an epidemic. It was lifestyle changing because I concluded that we cannot make a rational case for carrying 25 - 30 pounds of excess weight on our bodies. I decided to reduce the body's demand for glucose by removing the cells which in large measure create the demand.
4 months later here are the stats:
40 pounds lighter.
Blood glucose in the low end of the ideal range.
Cholesterol in the low end of the normal range.
Blood pressure in the low end of the ideal range.
The solution included:
Disciplined diet
Daily exercise - 2 miles
Disciplined daily focus on the #'s
Conclusion:
What was lifestyle changing was my acute awareness of what causes diabetes - and what we can choose to do about it. It was a choice because I had no threat that was imminent.
Here is what I learned:
As we grow older the pancreas, the organ that provides insulin to carry glucose in our blood vessels to the cells in our body which require energy - slows down. It simply does not produce enough insulin to get the glucose to where it is needed. It accumulates in our blood vessels and one day our physician announces "You have diabetes!".
It happens over time because we eat as we always have without realizing that the insulin producing motor is not keeping up with its job. They call it a silent killer.
None of the above is new. But for whatever reason the public does not internalize the significance on our life and our lifestyle.
Here is what I did - immediately.
I lost weight based upon my own self imposed diet
I began doing a 2 mile lap daily.
I measured the results daily.
I feel energized and relaxed and grateful to my physician.
Here is the connection with the impoverisation of our retirement income.
We live our daily economic lives very much by habit. One economic habit is our minimal savings for retirement. We don't change our economic habits for the same reason we don't change our eating habits to avoid diabetes. There does not appear to be an imminent financial threat.
One day a financial physician announces that "Your 30 - 40 year lifestyle may be less than 'golden'".
The solution is identical - awareness.
The requirements are identical - disciplined and applied focus.
The professional source of guidance and expertse that is necessary is identical - client centric professional expertise - i.e. financial phyicians
That is what we do.
The problem in health be it physical or financial is identical.
We must be aware - it must matter - we must choose to act. It is our choice.
Our professional lives are devoted to making it happen.
We wish you success.
Dan Zwicker.
12/21/2009
LINKEDIN - SOCIO ECONOMIC LEADERSHIP - A MODEL OF EXCELLENCE IN "PAYING IT FORWARD ".
The Social Media model is trust relationship driven - not conventional marketing driven.
The key human resource necessary is the capacity to collaboratively engage others through socio economic leadership.
Accountants, physicians, lawyers, engineers, other fee for service professionals, executives and business owners in the discharge of their socio economic responsibilities to clients have an opportunity when faced with difficult socio economic alternatives to chose a path which benefits the greater good.
An open and direct highly transparent digital platform is available to us to achieve this - we are all an integral part of it on Linkedin. It is changing the socio economic marketing paradigm in the delivery of all personal services including those which are fiduciary in nature wherein trust is the linchpin.
Our commitment on Linkedin is to exemplify the notion of "Paying it forward".
This is our value proposition in our professional practice and in our relationships on Linkedin.
Queen’s University’s Dean Kimberly A. Woodhouse, Ph.D., P.Eng., FCAE, FBSC in the Winter issue of the Faculty of Applied Science Magazine The Complete Engineer delivered her view of the Faculty’s role:
“Our biggest strength lies in the quality of people who create our communities.
Our vision is to educate leaders for the 21st century. To do that, we must prepare students to be innovators, creative problem solvers and leaders on global issues…”
That responsibility extends beyond the walls of universities. It applies directly to our initiatives within Linkedin. We have accepted it and are “paying it forward.
The key human resource necessary is the capacity to collaboratively engage others through socio economic leadership.
Accountants, physicians, lawyers, engineers, other fee for service professionals, executives and business owners in the discharge of their socio economic responsibilities to clients have an opportunity when faced with difficult socio economic alternatives to chose a path which benefits the greater good.
An open and direct highly transparent digital platform is available to us to achieve this - we are all an integral part of it on Linkedin. It is changing the socio economic marketing paradigm in the delivery of all personal services including those which are fiduciary in nature wherein trust is the linchpin.
Our commitment on Linkedin is to exemplify the notion of "Paying it forward".
This is our value proposition in our professional practice and in our relationships on Linkedin.
Queen’s University’s Dean Kimberly A. Woodhouse, Ph.D., P.Eng., FCAE, FBSC in the Winter issue of the Faculty of Applied Science Magazine The Complete Engineer delivered her view of the Faculty’s role:
“Our biggest strength lies in the quality of people who create our communities.
Our vision is to educate leaders for the 21st century. To do that, we must prepare students to be innovators, creative problem solvers and leaders on global issues…”
That responsibility extends beyond the walls of universities. It applies directly to our initiatives within Linkedin. We have accepted it and are “paying it forward.
12/19/2009
IS THE INVESTMENT INDUSTRY CLIENT CENTRIC?
NO.
The investment industry serves its shareholder financial interests first, then those of its advisors and then those of the consumer.
For more detail visit: http://www.linkedin.com/in/danzwicker
I'll be pleased to discuss the alternatives with you.
The investment industry serves its shareholder financial interests first, then those of its advisors and then those of the consumer.
For more detail visit: http://www.linkedin.com/in/danzwicker
I'll be pleased to discuss the alternatives with you.
12/17/2009
JUST SHUT UP AND LISTEN?
In an age of bloggers and social networks, you no longer control the conversation about your company. So you must recalibrate the way you see your marketing, branding and corporate communications.
Remember how simple it was to communicate with your customers in the good old days?
You initiated and managed specific conversations about your company and your products. For example, you could buy a couple of 10-second spots during the Super Bowl. Or you could entice customers to participate in focus groups and fill out surveys. Whatever the medium or venue, you ensured that in any conversation about you, you were the subject as well as the object.
Things have changed. Today, your customers are having various kinds of conversations among themselves out in the open. They write blogs; they argue with each other in bulletin boards; they tweet on Twitter about whatever; they post videos of their kids online; they talk about their lives and feelings in social networks. And they post reviews and commentaries about you.
In other words, you no longer manage the conversations among your customers in which your company or products may be mentioned, often in unpredictable contexts. What’s a brand-conscious company to do? Just shut up and listen?
No. But in light of this significant social change, companies need to recalibrate the way they see their marketing, branding and corporate communications.
Discontinuities:
Successful technologies often create discontinuities between the past and the present that go well beyond the technologies themselves—discontinuities in individual and social behavior that alter some aspect of society forever. Here are some examples of how recent advances in information technology are leading to important changes in how we communicate and consume information.
From “need to know” to “good to know”:
Quaint as it may seem, communication used to have a purpose—typically, to convey information that I needed to tell and you needed to know. No longer. Technology now gives me an extraordinary ability to talk a lot about nothing to no one in particular for no reason.
From “tell me” to “show me”:
Cheap digital and cell phone cameras that can shoot video plus free distribution media such as YouTube are fueling an explosion in video communication. Want to know how to fix your plumbing? Or learn how to make a Mexican tamale or play the guitar? Perhaps you’d like to see how arthroscopic surgery is done? Today, on the Web, you can find video clips—by amateurs as well as professionals—on almost any subject.
From “talk at you” to “talk with you”:
Not long ago, when producing and distributing information was relatively expensive, organizations ranging from companies to hospitals to governments controlled, and were at the center of, the communication with their public. By necessity, they talked at you. Today, two-way dialogue is not only possible but almost expected by individuals from these same organizations—especially from doctors and health care providers.
Eight to-do’s for Monday morning
How can a company take advantage of these fundamental changes in communication? Here are some relatively simple things to keep in mind, along with actions you can take immediately.
1. Not only are your employees, customers and competitors all talking and talking openly—so are your competitors’ employees and customers, and customers you never knew you had. Technology exists to process unstructured text for you to listen to them all—and listen at an industrial scale—enabling you to gauge your customers’ latent needs, how they feel about your products and brand, and what your competitors are up to.
There’s no reason to spend money on surveys anymore: Everything you want to know—and more—is out there in the open for you to harvest. With technology from vendors such as Sentimine and The Nielsen Co., companies ranging from carmakers to agribusinesses are monitoring and measuring customer sentiment over the Web.
2. Embrace video as a communication medium. If you are like most companies, you produce tons of written instruction manuals in multiple languages and package them with your products. Very few of your customers read them, in any language. With video, you can show them rather than tell them. The Home Depot, Dell, Best Buy and many others are increasingly turning to video as a means of customer support.
3. Create an online community of people who use, like, love—and, don’t forget, hate—your products. Facilitate but don’t dominate the conversation. Face it: Whatever your product or service may be, it’s just a small part of your customers’ lives. By creating as much conversation as you can among your customers about as many subjects as possible, you’ll ensure that your products become legitimate topics of conversation from time to time. This kind of publicity is more genuine and credible than any ad campaign you can run.
4. Caution: A good, active community is a double-edged sword. On the one hand, your community members are your ambassadors. On the other, your community is effectively offering your customers to your competitors on a platter as well as a forum where your disgruntled customers can complain. The bigger your community is, the more vulnerable you are.
Which is why you need to create and support brand ambassadors. Give them something to talk about, links and visuals to share. Dedicated customers can make great endorsements, but they can also be your harshest critics. Their enthusiasm and their occasional dings and dissatisfaction are what make them credible.
Censoring or stifling them will prove to be a double whammy—you’ll acquire not only a formidable enemy but one with a great deal of knowledge and credibility with respect to your brand in your community. The official Coca-Cola fan page on Facebook—which boasts 3 million plus members—is an interesting example of how to finesse this problem. Although the page was created by two individuals, the Coca-Cola Co. got involved and flew the pair to its Atlanta headquarters, where they made a creative video about the trip and posted it to the Facebook page.
5. Turn the real people who actually design and create your products into a marketing asset. If your brand is based on, say, your engineering prowess, are you encouraging your engineers to blog? Or if it’s based on fashion, are you encouraging your fashion designers to tweet on Twitter? Your most enthusiastic customers want to hear from them. For example, Eastman Kodak has created a blog called A Thousand Words in which its employees and customers share stories about film technology, history, old images, experiences and so forth.
6. There are many types of misinformation, ranging from product details (no private rooms for maternity patients in your hospital) to scientific inaccuracies (staring at computer screens for a long time causes migraines) to business rumors (you are about to merge with so and so). In the past, all these were handled by corporate communications professionals dealing with mainstream media. In the new world, you need to understand an important dynamic of communities: Credibility does not automatically accrue from authority.
Say, for example, a business rumor about your company is floating around in a forum frequented by product engineers and techies. You could just have your CEO address the forum directly, but that would have less impact than having your product engineer, who’s well known and respected in that forum, introduce the CEO, who then engages the community.
7. In the past, you probably thought of your website as a portal to your company—one place that concentrates all your essential information. Your goal was to entice everyone to visit. It may be time to turn this idea on its head. You may want to distribute your crucial information in the various places your consumers hang out.
Consider that “cool things you can do with my gizmo” video you made. Instead of burying it in your website and hoping your customers will search for it, why not publish it on YouTube or a Facebook community dedicated to gizmos so that people can stumble upon it? Serendipity is rapidly becoming serendipower. Many companies are using third-party websites such as YouTube and Facebook to reach their customers rather than trying to bring everyone to their own websites.
8. Finally, don’t forget your investors. The online revolution not only provides them with a lot more information about your company’s finances, it also provides them with relevant information—and possibly misinformation—about your customers, your employees and your competitors.
No doubt you have enough organizational machinery to fulfill regulatory disclosure requirements. But do you have any machinery to help investors understand how loyal your customers are? What your customers like and dislike about your products and services? What your employees like and dislike about working for you?
These may not yet be regulatory requirements in the new world, but your investors have means of getting at this information—perhaps suboptimally—today. Wouldn’t it be better for you, and not some fly-by-night podcast, to be the trusted, neutral and transparent source of that information for your investors? As they say, the well informed is less likely to be misinformed.
The new communications revolution is well under way, and that sound you hear is history tweeting. You really can’t afford to just shut up and listen.
Kishore S. Swaminathan
Chief scientist
Accenture
12/17/2009
Remember how simple it was to communicate with your customers in the good old days?
You initiated and managed specific conversations about your company and your products. For example, you could buy a couple of 10-second spots during the Super Bowl. Or you could entice customers to participate in focus groups and fill out surveys. Whatever the medium or venue, you ensured that in any conversation about you, you were the subject as well as the object.
Things have changed. Today, your customers are having various kinds of conversations among themselves out in the open. They write blogs; they argue with each other in bulletin boards; they tweet on Twitter about whatever; they post videos of their kids online; they talk about their lives and feelings in social networks. And they post reviews and commentaries about you.
In other words, you no longer manage the conversations among your customers in which your company or products may be mentioned, often in unpredictable contexts. What’s a brand-conscious company to do? Just shut up and listen?
No. But in light of this significant social change, companies need to recalibrate the way they see their marketing, branding and corporate communications.
Discontinuities:
Successful technologies often create discontinuities between the past and the present that go well beyond the technologies themselves—discontinuities in individual and social behavior that alter some aspect of society forever. Here are some examples of how recent advances in information technology are leading to important changes in how we communicate and consume information.
From “need to know” to “good to know”:
Quaint as it may seem, communication used to have a purpose—typically, to convey information that I needed to tell and you needed to know. No longer. Technology now gives me an extraordinary ability to talk a lot about nothing to no one in particular for no reason.
From “tell me” to “show me”:
From “talk at you” to “talk with you”:
Not long ago, when producing and distributing information was relatively expensive, organizations ranging from companies to hospitals to governments controlled, and were at the center of, the communication with their public. By necessity, they talked at you. Today, two-way dialogue is not only possible but almost expected by individuals from these same organizations—especially from doctors and health care providers.
Eight to-do’s for Monday morning
How can a company take advantage of these fundamental changes in communication? Here are some relatively simple things to keep in mind, along with actions you can take immediately.
1. Not only are your employees, customers and competitors all talking and talking openly—so are your competitors’ employees and customers, and customers you never knew you had. Technology exists to process unstructured text for you to listen to them all—and listen at an industrial scale—enabling you to gauge your customers’ latent needs, how they feel about your products and brand, and what your competitors are up to.
There’s no reason to spend money on surveys anymore: Everything you want to know—and more—is out there in the open for you to harvest. With technology from vendors such as Sentimine and The Nielsen Co., companies ranging from carmakers to agribusinesses are monitoring and measuring customer sentiment over the Web.
2. Embrace video as a communication medium. If you are like most companies, you produce tons of written instruction manuals in multiple languages and package them with your products. Very few of your customers read them, in any language. With video, you can show them rather than tell them. The Home Depot, Dell, Best Buy and many others are increasingly turning to video as a means of customer support.
3. Create an online community of people who use, like, love—and, don’t forget, hate—your products. Facilitate but don’t dominate the conversation. Face it: Whatever your product or service may be, it’s just a small part of your customers’ lives. By creating as much conversation as you can among your customers about as many subjects as possible, you’ll ensure that your products become legitimate topics of conversation from time to time. This kind of publicity is more genuine and credible than any ad campaign you can run.
4. Caution: A good, active community is a double-edged sword. On the one hand, your community members are your ambassadors. On the other, your community is effectively offering your customers to your competitors on a platter as well as a forum where your disgruntled customers can complain. The bigger your community is, the more vulnerable you are.
Which is why you need to create and support brand ambassadors. Give them something to talk about, links and visuals to share. Dedicated customers can make great endorsements, but they can also be your harshest critics. Their enthusiasm and their occasional dings and dissatisfaction are what make them credible.
Censoring or stifling them will prove to be a double whammy—you’ll acquire not only a formidable enemy but one with a great deal of knowledge and credibility with respect to your brand in your community. The official Coca-Cola fan page on Facebook—which boasts 3 million plus members—is an interesting example of how to finesse this problem. Although the page was created by two individuals, the Coca-Cola Co. got involved and flew the pair to its Atlanta headquarters, where they made a creative video about the trip and posted it to the Facebook page.
5. Turn the real people who actually design and create your products into a marketing asset. If your brand is based on, say, your engineering prowess, are you encouraging your engineers to blog? Or if it’s based on fashion, are you encouraging your fashion designers to tweet on Twitter? Your most enthusiastic customers want to hear from them. For example, Eastman Kodak has created a blog called A Thousand Words in which its employees and customers share stories about film technology, history, old images, experiences and so forth.
6. There are many types of misinformation, ranging from product details (no private rooms for maternity patients in your hospital) to scientific inaccuracies (staring at computer screens for a long time causes migraines) to business rumors (you are about to merge with so and so). In the past, all these were handled by corporate communications professionals dealing with mainstream media. In the new world, you need to understand an important dynamic of communities: Credibility does not automatically accrue from authority.
Say, for example, a business rumor about your company is floating around in a forum frequented by product engineers and techies. You could just have your CEO address the forum directly, but that would have less impact than having your product engineer, who’s well known and respected in that forum, introduce the CEO, who then engages the community.
7. In the past, you probably thought of your website as a portal to your company—one place that concentrates all your essential information. Your goal was to entice everyone to visit. It may be time to turn this idea on its head. You may want to distribute your crucial information in the various places your consumers hang out.
Consider that “cool things you can do with my gizmo” video you made. Instead of burying it in your website and hoping your customers will search for it, why not publish it on YouTube or a Facebook community dedicated to gizmos so that people can stumble upon it? Serendipity is rapidly becoming serendipower. Many companies are using third-party websites such as YouTube and Facebook to reach their customers rather than trying to bring everyone to their own websites.
8. Finally, don’t forget your investors. The online revolution not only provides them with a lot more information about your company’s finances, it also provides them with relevant information—and possibly misinformation—about your customers, your employees and your competitors.
No doubt you have enough organizational machinery to fulfill regulatory disclosure requirements. But do you have any machinery to help investors understand how loyal your customers are? What your customers like and dislike about your products and services? What your employees like and dislike about working for you?
These may not yet be regulatory requirements in the new world, but your investors have means of getting at this information—perhaps suboptimally—today. Wouldn’t it be better for you, and not some fly-by-night podcast, to be the trusted, neutral and transparent source of that information for your investors? As they say, the well informed is less likely to be misinformed.
The new communications revolution is well under way, and that sound you hear is history tweeting. You really can’t afford to just shut up and listen.
Kishore S. Swaminathan
Chief scientist
Accenture
12/17/2009
12/13/2009
ADVOCIS ADVISOR/DEALER SURVEY ON MUTUAL FUND REGULATION
Some noteworthy survey results:
Many financial advisors have seriously considered dropping their mutual fund license due to the compliance burden on licensed mutual fund representatives.
Very few respondents to the Advisor Survey consider that the MFDA is receptive to the views and concerns of advisors.
Dealers consider that the sales compliance audit process and the financial compliance audit process help them to understand deficiencies in their regulatory compliance and practices, and to meet dealer and SRO requirements.
A preponderance of the dealer respondents agreed that "The MFDA's current rules place disproportionate or excessive compliance burdens on small dealers as compared to large ones."
All of the dealer respondents who expressed an opinion on the question agreed that "The way things are going, it won't be long before there will only be a few large mutual fund dealers and the Bank or insurance-owned firms."
Seg fund requirements are clear
More respondents find the regulatory and compliance requirements for selling segregated funds to be clear and straightforward, and understand them, than is the case with the regulatory and compliance requirements for selling mutual funds.
More than three quarters (76.5%) of all respondents agreed
or agreed strongly, that the regulatory and compliance requirements for segregated funds are clear, straightforward and understandable. Only twelve percent (11.9%) did not agree. (Q3)
"Unfortunately the MFDA regs do little to protect clients, as risk tolerance is so highly subjective. The process is more about having the proper paperwork done and very little about consumer protection..." (Advisor response)
From Advocis 12/13/2009
12/12/2009
MY JOB
My job is not to make my clients rich but rather to help keep them from making themselves poor.
12/11/2009
SOCIAL MEDIA'S IMPACT ON MANAGEMENT
As a management consultant I have been inside numerous organizations helping them work on improvement agendas. Being on the inside is a revealing process and the consistent constraint for any improvement has always been management. When change is required for those in authority to change things they are indeed the ones who resist change.
Now with the transparency of communications and the ongoing economic pressures the role of management will need to change.
Change To What?
Organizational models are changing. From flexible work hours to virtual offices today’s modern organization is learning what is valuable and meaningful to people. Every business relies on people to effectively execute on processes that tie together production, marketing, sales and customer fulfillment. The customer relies on an organizations people to deliver what is or greater than what is expected.
Two things tie everything together, communications and relations.
Social technology is accelerating communications and revealing the value of meaningful relations. These new discoveries are transforming the role of management from the old command and control to the new “create value or get out of the way” framework.
Creating value is now the primary role of management and is different then supervision and control.
Scott Adams, from Dilbert.com writes: The Bad Management Stimulus: The Dilbert Principle observes that in the modern economy, the least capable people are promoted to management because companies need their smartest people to do the useful work. It’s hard to design software, but relatively easy to run staff meetings. This creates a situation where you have more geniuses reporting to morons than at any time in history. In that sort of environment you’d expect the geniuses to be looking for a way out, even if Plan B has a low chance of success.
Is It Now “Creation Management”?
Creation management is more about increasing value for people than it is about managing people. People are becoming self managed given all the productivity tools, the always communicating behavior and the emphasis on relations. Managements new role is constantly creating valuable tools, relations and knowledge that people can use to better serve each other and the end buyer.
The days of holding back needed changes, exercising power for powers sake and managing for self preservation are quickly coming to an end. Today’s markets are becoming more open, more transparent and subsequently unless an organization can continually create value for its people then the people cannot meet the markets demands.
The irony of Scott Adams statement of “the least capable people are promoted to management because companies need their smartest people to do the useful work” is that most smart employees have known this for years.
The more layers an organization has the more complexity and delay in communications.
Today’s “socialution” is more about flat organizations whose management is focused on creating meaningful value for people, inside and outside of the organization. While the words seem logical and meaningful the behavior is difficult for management who only understand command, control and resistance to change that changes them.
by Jay Deragon
Now with the transparency of communications and the ongoing economic pressures the role of management will need to change.
Change To What?
Organizational models are changing. From flexible work hours to virtual offices today’s modern organization is learning what is valuable and meaningful to people. Every business relies on people to effectively execute on processes that tie together production, marketing, sales and customer fulfillment. The customer relies on an organizations people to deliver what is or greater than what is expected.
Two things tie everything together, communications and relations.
Social technology is accelerating communications and revealing the value of meaningful relations. These new discoveries are transforming the role of management from the old command and control to the new “create value or get out of the way” framework.
Creating value is now the primary role of management and is different then supervision and control.
Scott Adams, from Dilbert.com writes: The Bad Management Stimulus: The Dilbert Principle observes that in the modern economy, the least capable people are promoted to management because companies need their smartest people to do the useful work. It’s hard to design software, but relatively easy to run staff meetings. This creates a situation where you have more geniuses reporting to morons than at any time in history. In that sort of environment you’d expect the geniuses to be looking for a way out, even if Plan B has a low chance of success.
Is It Now “Creation Management”?
Creation management is more about increasing value for people than it is about managing people. People are becoming self managed given all the productivity tools, the always communicating behavior and the emphasis on relations. Managements new role is constantly creating valuable tools, relations and knowledge that people can use to better serve each other and the end buyer.
The days of holding back needed changes, exercising power for powers sake and managing for self preservation are quickly coming to an end. Today’s markets are becoming more open, more transparent and subsequently unless an organization can continually create value for its people then the people cannot meet the markets demands.
The irony of Scott Adams statement of “the least capable people are promoted to management because companies need their smartest people to do the useful work” is that most smart employees have known this for years.
The more layers an organization has the more complexity and delay in communications.
Today’s “socialution” is more about flat organizations whose management is focused on creating meaningful value for people, inside and outside of the organization. While the words seem logical and meaningful the behavior is difficult for management who only understand command, control and resistance to change that changes them.
by Jay Deragon
11/28/2009
IMPARTIAL FINANCIAL ADVICE - WHAT DOES "IMPARTIAL" MEAN?
Free of product sales compensation as a direct derivative of financial advice..
11/25/2009
THE RELATIONSHIP ECONOMY - WHAT IS YOUR SOCIAL STRATEGY?
A Definition of “Social Strategy”
A social strategy defines how the organization can better “relate and communicate” with all its constituents. Constituencies includes people (markets, suppliers, customers, investors, society and employees) who interact with the organization, internally and externally.
Because the reach and richness of social technology is new it has never been considered of strategic importance until now. The ability to relate and communicate impacts everything, everyone and at speeds never before experienced. The knowledge domain of these issues simply does not exist but is evolving day by day and the related changes impact everything and everyone.
Creating a social strategy begins with mapping out how your organization currently relates and communicates with its constituencies. Additionally it is also of critical importance to conduct relevant research which defines what, how, when, where and why the market may be discussing your organization, its products, services and people. From these two assessments the data collected will help define the vital few issues needing immediate attention and the critical issues needing change over the long term.
Learning is always an element in strategic development and creating a social strategy will require a plan for the entire organization to learn who,what,where,when, why and how to improve “relations and communications” internally and externally.
Strategy is about having a road map to reach strategic objectives. Social strategies is about how to ensure your organization is ready to follow the map effectively and what new knowledge is required. Although knowledge about the technology is a given more importantly knowledge of the inter-related dynamics it creates and the impact those dynamics have on results is critical.
The disciplines and knowledge required to develop and execute a social strategy. requires a new frame of mind - a new paradigm that is in opposition to business as usual and defines a new road map for business thinking and processes that are unusual.
Not having a social strategy means your organization will likely fail in the emerging markets that are quickly replacing all markets.
As more and more businesses migrate to use of social media it quickly becomes evident that they lack a strategy.
What Will A Social Strategy Encompass?
Since social technology is new there is a lack of knowledge relative to its impact on strategic thinking and the related disciplines. Traditionally strategic thinking has encompassed organizational alignment of key elements present in most organizations. These elements included: organizational design, culture, leadership, management, communications, marketing, technology, human relations, finance and market research. There are a host of subset elements for each of the primary elements but in essence strategy was about the development and deployment of a road map that maximized the efficiency and effectiveness of the entire organization.
Methods for developing a strategy have varied over the years but for the most part all relied upon the collection and assessment of relevant and relative data which verified and created the strategic direction. Directions were aimed at maximizing performance. Now with the emerging influence of social technology a new element has entered into the process of building and deploying effective strategies.
From: The Relationship Economy
11/24/2009
LINKEDIN - SOCIAL MEDIA - ITS ROLE
The use of Linkedin underlines the global interest among more than 50,000,000 members in the notion of sharing their best in real time.
My interests have taken the form of invitations to those individuals for whom collaborative communication, teamwork and critical strategic thinking are essential skills in their chosen fields.
It is a very effective social media platform in assembling intellectual/social capital for the sole purpose of satisfying a common good. In my case and that of my industry that includes but is not restricted to serving 90,000,000 boomers in North America who are at various stages of preparation for a 30 - 40 year retirement and for whom access to impartial financial advice is a challenge.
Longterm retirement takes substantial sustainable income - given that no employment income is expected to be available. The sustainabilty of retirement income given the financial meltdown is in serious question.
Members of Linkedin who are a part of my network have expressed a genuine desire to help in any way they can. It is my purpose to provide a collaborative opportunity for each of those members to provide their input as we continue to develop a real time solution to the need for direct access to the best and the brightest financial retirement practitioners whose education, training, skill and genuine concern are essential in assisting in the income sustainability challenge being faced in our foreseeable financial climate.
I am grateful for the opportunity Linkedin has provided to communicate with numerous professionals who care enough to reach out and to contribute their best.
My interests have taken the form of invitations to those individuals for whom collaborative communication, teamwork and critical strategic thinking are essential skills in their chosen fields.
It is a very effective social media platform in assembling intellectual/social capital for the sole purpose of satisfying a common good. In my case and that of my industry that includes but is not restricted to serving 90,000,000 boomers in North America who are at various stages of preparation for a 30 - 40 year retirement and for whom access to impartial financial advice is a challenge.
Longterm retirement takes substantial sustainable income - given that no employment income is expected to be available. The sustainabilty of retirement income given the financial meltdown is in serious question.
Members of Linkedin who are a part of my network have expressed a genuine desire to help in any way they can. It is my purpose to provide a collaborative opportunity for each of those members to provide their input as we continue to develop a real time solution to the need for direct access to the best and the brightest financial retirement practitioners whose education, training, skill and genuine concern are essential in assisting in the income sustainability challenge being faced in our foreseeable financial climate.
I am grateful for the opportunity Linkedin has provided to communicate with numerous professionals who care enough to reach out and to contribute their best.
11/22/2009
HOW DO YOU SELL SOMETHING FOR WHICH THE NEED IS 100% AND THE DEMAND IS ZERO?
We are referring to the fact that we all die (Need - 100%). No one wants to buy life insured instruments. (Demand - 0%)
In the case of life insured financial instruments........you don't sell it.
Commodities are sold.
Life insurance is not a commodity.
It is a legal document that binds a financial institution to provide the capital necessary upon the death of a policyowner to assure the lifetime income that a loved one, a business entity, a charity or any number of possible beneficiaries may require to survive financially.
The act of insuring one's life is a highly personal value statement. It is the antithesis of a conventional market transaction.
For this reason it cannot be sold.
The top 2 - 3% of the professional practice leaders in the life insurance sector engage their clients through numerous sequential acts of leadership - one on one. Their objective is to help their clients become aware of, understand and feel comfortable making a values based decision that reflects the core of their character, integrity, love, moral and ethical responsibilty for a family member, business colleague or partner to eradicate a financial debt or obligation which will arise upon their death and which would otherwise remain a financial burden to those who were financially dependent upon the deceased individual.
This values based decision is anything but transactional.
In a product driven commoditized financial marketplace the need for ethically unbiased consumer centric financial advisory leadership is paramount. The same leadership principle applies to our need for open and direct competent diagnosis and advice from those physicians upon whose medical practice we depend for our physical and mental well being.
Such professional practice leadership is rare.
When it appears it is a work of art and empathetic compassion.
In the case of life insured financial instruments........you don't sell it.
Commodities are sold.
Life insurance is not a commodity.
It is a legal document that binds a financial institution to provide the capital necessary upon the death of a policyowner to assure the lifetime income that a loved one, a business entity, a charity or any number of possible beneficiaries may require to survive financially.
The act of insuring one's life is a highly personal value statement. It is the antithesis of a conventional market transaction.
For this reason it cannot be sold.
The top 2 - 3% of the professional practice leaders in the life insurance sector engage their clients through numerous sequential acts of leadership - one on one. Their objective is to help their clients become aware of, understand and feel comfortable making a values based decision that reflects the core of their character, integrity, love, moral and ethical responsibilty for a family member, business colleague or partner to eradicate a financial debt or obligation which will arise upon their death and which would otherwise remain a financial burden to those who were financially dependent upon the deceased individual.
This values based decision is anything but transactional.
In a product driven commoditized financial marketplace the need for ethically unbiased consumer centric financial advisory leadership is paramount. The same leadership principle applies to our need for open and direct competent diagnosis and advice from those physicians upon whose medical practice we depend for our physical and mental well being.
Such professional practice leadership is rare.
When it appears it is a work of art and empathetic compassion.
11/18/2009
PEOPLE CAN'T RETIRE FOR THE SAME REASON THEY DEVELOP DIABETES AND OTHER HIGH RISK DEBILITATING ILLNESSES
As we get older our body organs become less effective. In the case of diabetes the organ that slows down is the pancreas. It produces the insulin we need to carry the glucose in our blood vessels to our body fat cells. As the pancreas slows down it does not produce enough insulin to remove the glucose from our blood stream.
One day the doctor says "you have developed diabetes", i.e. too much glucose (sugar) in our blood. Why? Because besides diet the only key variable we can control is our weight. Our body fat cells demand glucose - the more cells the higher the demand. The key is to lower the demand i.e. our weight to a level that is compatible with the level of insulin the pancreas can deliver.
.
Simple? If it is so simple why do we have an epidemic of diabetes among young and old? We are unaware that our body has become less efficient and our eating habits have not adjusted to balance the supply of insulin with a lower demand by our body's cells - i.e., a lower weight. Losing weight is not easy or fun so we ignore it. We choose our palate over our lifestyle.
We can't retire with a guaranteed lifetime income for the same reason. We are unaware that we must guarantee our income throughout our final 30 - 40 year retirement years and we have not adjusted our financial focus to guaranteeing our life sustaining income - risk free - our primary focus has been to accumulate capital. Accumulation stems from our need for financial security. Risk is distateful so we ignore or deny it as a factor in both our mortality and our morbitity.
In the case of diabetes our denial results in building up too much glucose without being aware of it. One day our financial 'physician' informs us that we will run out of income - prematurely. What we don't measure can disable us - physically or financially.
Solving this financial health shortfall is our life work and our passion.
One day the doctor says "you have developed diabetes", i.e. too much glucose (sugar) in our blood. Why? Because besides diet the only key variable we can control is our weight. Our body fat cells demand glucose - the more cells the higher the demand. The key is to lower the demand i.e. our weight to a level that is compatible with the level of insulin the pancreas can deliver.
.
Simple? If it is so simple why do we have an epidemic of diabetes among young and old? We are unaware that our body has become less efficient and our eating habits have not adjusted to balance the supply of insulin with a lower demand by our body's cells - i.e., a lower weight. Losing weight is not easy or fun so we ignore it. We choose our palate over our lifestyle.
We can't retire with a guaranteed lifetime income for the same reason. We are unaware that we must guarantee our income throughout our final 30 - 40 year retirement years and we have not adjusted our financial focus to guaranteeing our life sustaining income - risk free - our primary focus has been to accumulate capital. Accumulation stems from our need for financial security. Risk is distateful so we ignore or deny it as a factor in both our mortality and our morbitity.
In the case of diabetes our denial results in building up too much glucose without being aware of it. One day our financial 'physician' informs us that we will run out of income - prematurely. What we don't measure can disable us - physically or financially.
11/16/2009
BEYOND ASSET ALLOCATION - PRODUCT ALLOCATION - INCOME THROUGHOUT RETIREMENT
Historically, advisors have accepted the strategy of asset allocation as a great way to protect clients from risk while maximizing their potential returns over time. However, 2008 proved to us that no matter how well assets were allocated or diversified, this strategy just wasn't enough to protect a lot of investors from the thrill ride the market provided.
The downturn may not have upset your clients too much if, for the most part, they were living on guaranteed pensions; most likely, the markets only wreaked havoc on their vacation or spending money. But for clients whose financial survival was threatened, it would have been a different story. Clients in the retirement risk zone — five years or less from retirement or already retired and living off their invested assets — had a very rude awakening. Unfortunately, so did we—the advisors.
Everything we've been taught told us that the best possible outcome would occur if we just made sure our clients' assets were appropriately diversified according to risk tolerance among good quality investments. Many economists and fund managers, as well as the investment companies they work for, agreed that this was standard operating procedure. This was certainly backed up by the information we had at the time. I'm sure if you close your eyes just for a moment, you can picture the standard asset allocation slide that showed 91% of a portfolio's long-term performance could be attributed to asset allocation. Can you see it? I can.
So what are we to do post-2008 now that we know better? How can we actually do better? Thankfully, there have been some breakthrough strategies on this front. One ground-breaking concept that I was lucky enough to learn of first-hand as an advisory board member, is an approach called product allocation.
The first product allocation tool for advisors was developed by Manulife Investments in collaboration with Dr. Moshe Milevsky and the QWeMA Group. The product allocation tool's primary function is to estimate the sustainability of a client's retirement income plan and then determine the optimal allocation of assets between various products in order to sustain retirement income for the client's lifetime. To arrive at these conclusions, Milevsky developed the concept of retirement sustainability quotient (RSQ).
Product allocation is meant to be the final step of a written financial plan, or retirement income plan, for those in the retirement risk zone. Once you've completed the traditional portion of the financial plan, the next step is to determine the best product selection to create a high probability of sustaining the client's required retirement income. The product allocation tool puts assets into three different categories: immediate annuities, guaranteed minimum withdrawal benefit (GMWB) products and systematic withdrawal plans (ie, GIC's, mutual funds, seg funds other than GMWBs, stocks, bonds, cash, etc.). For many of us, this might mean looking at products we've either never sold, or haven't sold in some time.
I know changes and regulations are coming at us a mile a minute, but clients deserve our best. I believe this so much that that I've used my first official column with Advisor.ca to get the word out: we need to make sure we have a thorough understanding of product allocation and how it can fit into our current practices.
Not only are the best interests of our clients at stake, but the best interests of our businesses are as well. Failing to grasp this concept, or worse, ignoring it altogether, could not only make you vulnerable to losing clients to advisors who "get it," but you may be considered by some to be negligent. In a world where you can sue someone if you spill hot coffee on yourself, your time is well spent protecting yourself; even more so when you're protecting your clients at the same time.
About 38% of Canadians have pension plans today, only some of which are guaranteed. The other 62% have no plan beyond basic government benefits. This leaves us with a giant wave of DIY retirees, something we've never experienced before. While you may have to let go of some product biases to integrate product allocation into your practice, it's a necessary step. This is a new era and we need to use new tools.
If you take a closer look at the sustainability of your clients' retirement income, you may find many holes. You owe it to your clients to carefully consider any tool or product that may give them the best chance at the retirement they have planned for. Product allocation is not about any one product or any one company. Any advisor can access the product allocation tool and related resources at www.productallocation.ca.
11/12/09
Filed by Stephanie Holmes-Winton
Originally published on Advisor.ca
The downturn may not have upset your clients too much if, for the most part, they were living on guaranteed pensions; most likely, the markets only wreaked havoc on their vacation or spending money. But for clients whose financial survival was threatened, it would have been a different story. Clients in the retirement risk zone — five years or less from retirement or already retired and living off their invested assets — had a very rude awakening. Unfortunately, so did we—the advisors.
Everything we've been taught told us that the best possible outcome would occur if we just made sure our clients' assets were appropriately diversified according to risk tolerance among good quality investments. Many economists and fund managers, as well as the investment companies they work for, agreed that this was standard operating procedure. This was certainly backed up by the information we had at the time. I'm sure if you close your eyes just for a moment, you can picture the standard asset allocation slide that showed 91% of a portfolio's long-term performance could be attributed to asset allocation. Can you see it? I can.
So what are we to do post-2008 now that we know better? How can we actually do better? Thankfully, there have been some breakthrough strategies on this front. One ground-breaking concept that I was lucky enough to learn of first-hand as an advisory board member, is an approach called product allocation.
The first product allocation tool for advisors was developed by Manulife Investments in collaboration with Dr. Moshe Milevsky and the QWeMA Group. The product allocation tool's primary function is to estimate the sustainability of a client's retirement income plan and then determine the optimal allocation of assets between various products in order to sustain retirement income for the client's lifetime. To arrive at these conclusions, Milevsky developed the concept of retirement sustainability quotient (RSQ).
Product allocation is meant to be the final step of a written financial plan, or retirement income plan, for those in the retirement risk zone. Once you've completed the traditional portion of the financial plan, the next step is to determine the best product selection to create a high probability of sustaining the client's required retirement income. The product allocation tool puts assets into three different categories: immediate annuities, guaranteed minimum withdrawal benefit (GMWB) products and systematic withdrawal plans (ie, GIC's, mutual funds, seg funds other than GMWBs, stocks, bonds, cash, etc.). For many of us, this might mean looking at products we've either never sold, or haven't sold in some time.
I know changes and regulations are coming at us a mile a minute, but clients deserve our best. I believe this so much that that I've used my first official column with Advisor.ca to get the word out: we need to make sure we have a thorough understanding of product allocation and how it can fit into our current practices.
Not only are the best interests of our clients at stake, but the best interests of our businesses are as well. Failing to grasp this concept, or worse, ignoring it altogether, could not only make you vulnerable to losing clients to advisors who "get it," but you may be considered by some to be negligent. In a world where you can sue someone if you spill hot coffee on yourself, your time is well spent protecting yourself; even more so when you're protecting your clients at the same time.
About 38% of Canadians have pension plans today, only some of which are guaranteed. The other 62% have no plan beyond basic government benefits. This leaves us with a giant wave of DIY retirees, something we've never experienced before. While you may have to let go of some product biases to integrate product allocation into your practice, it's a necessary step. This is a new era and we need to use new tools.
If you take a closer look at the sustainability of your clients' retirement income, you may find many holes. You owe it to your clients to carefully consider any tool or product that may give them the best chance at the retirement they have planned for. Product allocation is not about any one product or any one company. Any advisor can access the product allocation tool and related resources at www.productallocation.ca.
11/12/09
Filed by Stephanie Holmes-Winton
Originally published on Advisor.ca
10/26/2009
CAN YOU RETIRE - "BEYOND RISK?"
To learn what we do and who we are visit:
Beyond Risk at: http://www.beyondrisk.blogspot.com
Linkedin at: http://www.linkedin/in/danzwicker
We don’t sell.
We solve problems.
Check our credentials.
Call or email us and we’ll be pleased to help.
Dan Zwicker, CFP
Bus: 416-726-2427
Email: danzwicker@rogers.com
We are linked to the best and the brightest professional financial retirement practitioners in Canada.
10/20/2009
SUN LIFE CREATES ADVISOR MATCH SERVICE
It may not be as scintillating as online dating services, but Sun Life has entered the matchmaking business creating Advisor Match, a website that matches up clients with advisors based on compatibility.
"Through focus groups, consumers told us that the recent recession has changed what they're looking for from companies they deal with for financial and insurance needs," says Lori Bak, vice-president, marketing with Sun Life Financial Canada. "We listened to Canadians and built an online resource based on what they told us was important to them when it comes to finding an advisor."
Advisor Match will be is an easy-to-use application that allows Canadians to input information that is used to filter potential advisor matches. Research indicates that age, gender and language preferences are significant factors for a successful advisor relationship. Based on this and additional criteria, Advisor Match provides up to 12 potential advisor candidates and allows customers to decide if they want to contact the advisor of their choice or if they would like the advisor to contact them.
Kevin Strain, senior vice-president of individual insurance and investments for Sun Life Canada, emphasized that the matches are designed to be long-term relationships.
"A lot of these relations last decades if not through generations. We have advisors who are third-generation advisors, their grandfather worked with their family advisor and now they work with the family advisor," Strain says. "We looked at criteria that form the foundation of long-term relationships; location was obviously one—you want somebody who is close to you, age was important—what life stage you're in, other factors such as gender, language and affluence sometimes also played a role."
Strain says that the M.O. of successful relationships seems to form around similar life situations.
"We've found really what people are looking for is someone who is in a similar situation to them," he says. "They understand what the other person is going through—that tends to form the basis of long-term relationships."
Over the next few months Sun Life will promote their Advisor Match service in a national advertising campaign. Strain says the program has 1,500 participating advisors in 349 communities across Canada. More than 50 different languages are spoken by Sun Life advisors and all of the advisors in the program will have both insurance and mutual fund licenses.
While the advertising campaign should increase awareness of the program to retail Canadian investors, the website may end up being just as valuable for group plan sponsors. Value-added advice for group plan members has been an increasing concern, particularly for retiring members. This service can be used for some institutions to match up plan members with an advisor, Strain says.
A group client that was sold by an advisor—a corporate account—we already work with that group business and the advisor would continue to work with the client is in that basis. We don't disrupt that," he says. "Where there are situations where there is a group client that doesn't have an advisor attached to it, we've tried to match clients up with an advisor. Right now, were in the process of replacing our Find an Advisor tool with Advisor Match."
Strain adds, "We have research that shows that Canadians derive financial benefits with working with advisors. Eighty-six percent of Canadians say they make better decisions about their finances when working with an advisor, 83% say they are more confident about their finances and 82% they will have a better a retirement if it's created with an advisor. We want to help all [our customers] link to advisors who will help create that value for them."
Advisor.ca
10/20/2009
"Through focus groups, consumers told us that the recent recession has changed what they're looking for from companies they deal with for financial and insurance needs," says Lori Bak, vice-president, marketing with Sun Life Financial Canada. "We listened to Canadians and built an online resource based on what they told us was important to them when it comes to finding an advisor."
Advisor Match will be is an easy-to-use application that allows Canadians to input information that is used to filter potential advisor matches. Research indicates that age, gender and language preferences are significant factors for a successful advisor relationship. Based on this and additional criteria, Advisor Match provides up to 12 potential advisor candidates and allows customers to decide if they want to contact the advisor of their choice or if they would like the advisor to contact them.
Kevin Strain, senior vice-president of individual insurance and investments for Sun Life Canada, emphasized that the matches are designed to be long-term relationships.
"A lot of these relations last decades if not through generations. We have advisors who are third-generation advisors, their grandfather worked with their family advisor and now they work with the family advisor," Strain says. "We looked at criteria that form the foundation of long-term relationships; location was obviously one—you want somebody who is close to you, age was important—what life stage you're in, other factors such as gender, language and affluence sometimes also played a role."
Strain says that the M.O. of successful relationships seems to form around similar life situations.
"We've found really what people are looking for is someone who is in a similar situation to them," he says. "They understand what the other person is going through—that tends to form the basis of long-term relationships."
Over the next few months Sun Life will promote their Advisor Match service in a national advertising campaign. Strain says the program has 1,500 participating advisors in 349 communities across Canada. More than 50 different languages are spoken by Sun Life advisors and all of the advisors in the program will have both insurance and mutual fund licenses.
While the advertising campaign should increase awareness of the program to retail Canadian investors, the website may end up being just as valuable for group plan sponsors. Value-added advice for group plan members has been an increasing concern, particularly for retiring members. This service can be used for some institutions to match up plan members with an advisor, Strain says.
A group client that was sold by an advisor—a corporate account—we already work with that group business and the advisor would continue to work with the client is in that basis. We don't disrupt that," he says. "Where there are situations where there is a group client that doesn't have an advisor attached to it, we've tried to match clients up with an advisor. Right now, were in the process of replacing our Find an Advisor tool with Advisor Match."
Strain adds, "We have research that shows that Canadians derive financial benefits with working with advisors. Eighty-six percent of Canadians say they make better decisions about their finances when working with an advisor, 83% say they are more confident about their finances and 82% they will have a better a retirement if it's created with an advisor. We want to help all [our customers] link to advisors who will help create that value for them."
Advisor.ca
10/20/2009
10/18/2009
COMMERCIAL SOCIAL MEDIA - A REAL TIME MARKETING PARADIGM SHIFT
.......is the collaborative use of 'viral' one to one digital 'word of mouth' referrals to generate revenue.
It is NOT about advertising.
It is not about sales.
It is about social engagement.
It is about giving.
It is genuine.
It is voluntary.
It is consumer centric.
It is pull - not push.
It is effective.
It is here.
It's skilful use was instrumental in the election of President Obama.
We are proactively engaged.
It is NOT about advertising.
It is not about sales.
It is about social engagement.
It is about giving.
It is genuine.
It is voluntary.
It is consumer centric.
It is pull - not push.
It is effective.
It is here.
It's skilful use was instrumental in the election of President Obama.
We are proactively engaged.
10/15/2009
TECHNOLOGY CHANGES CLIENT INTERACTION
The growing popularity of smart phones is changing the way consumers prefer to communicate with the financial services sector, according to a new study from Telus and IDC Canada.
As laptop ownership has moved into the mainstream (overall ownership reached 49% in 2009, according to the report), smart phones are moving stealthily in popularity and are having an impact on how consumers are interacting with one another and their service providers.
Ownership levels of smart phones have risen to 14% in 2009, from 8% in 2007, when an earlier version of the white paper was published, according to the data. More importantly, the desire to own a smart phone has risen among the younger population: 55% of those aged 13 to 17 want one, so do 40% of 18- to 24-year-olds.
The changing technology has allowed consumers to surf the internet on their morning commutes, access email from the airport and run applications such as stock-trading platforms while in a hotel room halfway around the world.
"Sooner or later, the financial institutions will start looking at these communication tools and start incorporating them into their IT practices," says Ismali Pishori, vice-president of vertical marketing at Telus.
However, age is no longer the predictor of interaction behaviour between a customer and the financial services sector, according to the research. The notion that someone in his 70s is not a technology-savvy individual is a mistake for a financial institution to make, says Pishori. "Age is no longer an indicator of how one behaves."
The ability of service-driven institutions to use multiple means of communicating is putting greater pressure on financial institutions to provide similar service.
What this means for client relations
In the case of advisors, the flexibility and ability to use multiple mediums to communicate with the client base, whether through a servicing cycle or through a selling cycle, are important in their communication, says Pishori. He noted that the time is now for advisors to start thinking about communication, not only for their current customer base but also in terms of where they are going to get the next customer.
Dr. Robert Kerton, professor of consumer economics at the University of Waterloo and a consumer issues expert, pointed out that a growing number of consumers want open communication with organizations. While consumers have access to newer technology, there's a growing importance for the financial institutions to meeting those communication styles.
The research revealed that about 60% of respondents are consumers who want new forms of communication with their financial services providers. Only 37% responded as "not interested."
The relationship between financial institutions and their customers has become more difficult in the last decade due to a large portion of customers requiring asynchronous services and a significant portion of customers, 48% according to the data, preferring traditional methods of face-to-face interaction.
"For the financial services sector, service quality is a race between expectation: what you think the institution should do and what they actually deliver technologically," says Kerton.
In the evolving marketplace, the majority of future customers fall into four categories, according to the research. Urban Established, who make up 21% of the communication spectrum, will have an impact on the customer and service provider interaction. Integrated Users, who make up 10%, are likely to use more tools but expect continuous dialogue. While On the Move (9%) and Social Networkers (12%) are two groups that adopt new methods of communication.
Kerton pointed out two key groups, On the Move and Integrated Users, as the ones to watch for future technology and communication trends.
However, when it comes to complaints, a different group comes to the forefront: the Social Networkers.
"They are the ones who can flame you. They are live and online. I would pay close attention if I were a financial institution to that sub-sector just to make sure that my complaint-handling method is a complete success at retaining a customer who, let's say, was insulted," says Kerton.
The next 10 years will be crucial for financial institutions to provide positive consumer experience, as there will be a growing need to balance services between the tech-savvy and the traditional consumer, according to the data.
Anna Olejarczyk
Advisor.ca
10/14/09
As laptop ownership has moved into the mainstream (overall ownership reached 49% in 2009, according to the report), smart phones are moving stealthily in popularity and are having an impact on how consumers are interacting with one another and their service providers.
Ownership levels of smart phones have risen to 14% in 2009, from 8% in 2007, when an earlier version of the white paper was published, according to the data. More importantly, the desire to own a smart phone has risen among the younger population: 55% of those aged 13 to 17 want one, so do 40% of 18- to 24-year-olds.
The changing technology has allowed consumers to surf the internet on their morning commutes, access email from the airport and run applications such as stock-trading platforms while in a hotel room halfway around the world.
"Sooner or later, the financial institutions will start looking at these communication tools and start incorporating them into their IT practices," says Ismali Pishori, vice-president of vertical marketing at Telus.
However, age is no longer the predictor of interaction behaviour between a customer and the financial services sector, according to the research. The notion that someone in his 70s is not a technology-savvy individual is a mistake for a financial institution to make, says Pishori. "Age is no longer an indicator of how one behaves."
The ability of service-driven institutions to use multiple means of communicating is putting greater pressure on financial institutions to provide similar service.
What this means for client relations
In the case of advisors, the flexibility and ability to use multiple mediums to communicate with the client base, whether through a servicing cycle or through a selling cycle, are important in their communication, says Pishori. He noted that the time is now for advisors to start thinking about communication, not only for their current customer base but also in terms of where they are going to get the next customer.
Dr. Robert Kerton, professor of consumer economics at the University of Waterloo and a consumer issues expert, pointed out that a growing number of consumers want open communication with organizations. While consumers have access to newer technology, there's a growing importance for the financial institutions to meeting those communication styles.
The research revealed that about 60% of respondents are consumers who want new forms of communication with their financial services providers. Only 37% responded as "not interested."
The relationship between financial institutions and their customers has become more difficult in the last decade due to a large portion of customers requiring asynchronous services and a significant portion of customers, 48% according to the data, preferring traditional methods of face-to-face interaction.
"For the financial services sector, service quality is a race between expectation: what you think the institution should do and what they actually deliver technologically," says Kerton.
In the evolving marketplace, the majority of future customers fall into four categories, according to the research. Urban Established, who make up 21% of the communication spectrum, will have an impact on the customer and service provider interaction. Integrated Users, who make up 10%, are likely to use more tools but expect continuous dialogue. While On the Move (9%) and Social Networkers (12%) are two groups that adopt new methods of communication.
Kerton pointed out two key groups, On the Move and Integrated Users, as the ones to watch for future technology and communication trends.
However, when it comes to complaints, a different group comes to the forefront: the Social Networkers.
"They are the ones who can flame you. They are live and online. I would pay close attention if I were a financial institution to that sub-sector just to make sure that my complaint-handling method is a complete success at retaining a customer who, let's say, was insulted," says Kerton.
The next 10 years will be crucial for financial institutions to provide positive consumer experience, as there will be a growing need to balance services between the tech-savvy and the traditional consumer, according to the data.
Anna Olejarczyk
Advisor.ca
10/14/09
10/09/2009
FEDERAL LEGISLATION PROHIBITING THE SALE OF INSURANCE ON THE INTERNET
Whereas the tied selling pressure that can be brought to bear on consumers by banks to purchase their property & casualty and life insurance products is clear there is one key issue which mitigates against the banks being able to sell insurance of any kind through their bank branches or via the web.
I will describe the case for the life insurance sector since I can speak to this through my own experience in the industry.
Banks sell commodities - products sold in a transactional environment - in a branch.
Life insurance is not a commodity. It is among the most complex financial instruments in the financial services sector. It requires professionally designated, trained, and fully experienced advisors to offer the optimum value to each client based upon a clear analysis of their unique personal and financial lifestyle and medical circumstances. The engagement of a client is premised upon consummate trust in the advisor's professional qualification and integrity to serve as a financial practitioner.This cannot happen in a bank branch or through a bank website under the current banking distribution model.
.
The basis of the confusion in the current financial services distribution environment, which has had a long history, is this. We are in the most disruptive personal financial environment since the depression. What we need most are financial practitioners. What is available is product promotion without comprehensive planning - in all but a very small segment of the distribution chain. Advisors get paid by selling products. Fee for service advice driven by planning is not the industry MO. The banks and insurance industry as a whole have driven this model for a very long time.
When we are in pain we seek out a physician and want to simply know if "We will be OK".
If the doctor prescribes medication after a diagosis we fill the Rx. In our industry financial 'prescriptions' are dispensed because that is the basis upon which advisors earn a living.
It is not difficult to understand the confusion that the public face in this area of their lives.
In my opinion all of the above has influenced Mr. Flaherty's decision in favour of the new legislation.
I am sharing this with you because I believe it to be a root cause of the dilemma.
I hope it adds some insight with regard to the life sector.
I will describe the case for the life insurance sector since I can speak to this through my own experience in the industry.
Banks sell commodities - products sold in a transactional environment - in a branch.
Life insurance is not a commodity. It is among the most complex financial instruments in the financial services sector. It requires professionally designated, trained, and fully experienced advisors to offer the optimum value to each client based upon a clear analysis of their unique personal and financial lifestyle and medical circumstances. The engagement of a client is premised upon consummate trust in the advisor's professional qualification and integrity to serve as a financial practitioner.This cannot happen in a bank branch or through a bank website under the current banking distribution model.
.
The basis of the confusion in the current financial services distribution environment, which has had a long history, is this. We are in the most disruptive personal financial environment since the depression. What we need most are financial practitioners. What is available is product promotion without comprehensive planning - in all but a very small segment of the distribution chain. Advisors get paid by selling products. Fee for service advice driven by planning is not the industry MO. The banks and insurance industry as a whole have driven this model for a very long time.
When we are in pain we seek out a physician and want to simply know if "We will be OK".
If the doctor prescribes medication after a diagosis we fill the Rx. In our industry financial 'prescriptions' are dispensed because that is the basis upon which advisors earn a living.
It is not difficult to understand the confusion that the public face in this area of their lives.
In my opinion all of the above has influenced Mr. Flaherty's decision in favour of the new legislation.
I am sharing this with you because I believe it to be a root cause of the dilemma.
I hope it adds some insight with regard to the life sector.
IS YOUR SOCIAL MEDIA BEING CONDUCTED BY A NURSE OR A BRAIN SURGEON?
"Forgive the analogy, but I often hear my former peers in Fortune 500 CPG Marketing tell me “we’re doing Social Media” when I ask. The point is this: a nurse and a brain surgeon are both in “medicine”, but I wouldn’t want the nurse operating on my brain. The same is true in the most vital area of your business.
Most typically, major companies have scrambled to assemble teams of classically trained marketing folks like me. I spent 25 years in ‘classical’ Marketing with Nestle, Sara Lee, Coca-Cola, Coors, and sat across the desk with P&G, Kroger, etc. on ‘targeted marketing’ while with Catalina Marketing. The singular issue with ‘classically trained’ marketers is that everything they have ‘experientially’ gained with years of tremendous experience has suddenly become obselete (at least in the application of Social Media). Our instinct (and in some cases self-protectionism) causes many to build on that experience and attempt to retrofit ‘old models’ into the ‘new media’. It doesn’t work!! ‘Old models’ ultimately tell us to ‘push’ our agenda on either a mass or somewhat targeted audience via traditional media choices and paper-dependent incentives (ad features, coupons, DM, etc…). We know these are highly inefficient (FSIs producing <>
A point for discussion is this: Pushing a commercial message is Anti-Social and looses audiences faster than you can change the radio channel or hit fast forward on your TV’s DVR. Social Media, if done right, ‘pulls’ an audience to you. You suddenly find yourself on Page 1 of Google searches. You are engaged with a targeted audience that targeted themselves before you even got to the party. And if you really have that brain surgeon on the team, you can even build businesses and monetize all that chatter…the ultimate goal of business within the SM world."
Tom Nilsen
EVP-Sales & Marketing
Most typically, major companies have scrambled to assemble teams of classically trained marketing folks like me. I spent 25 years in ‘classical’ Marketing with Nestle, Sara Lee, Coca-Cola, Coors, and sat across the desk with P&G, Kroger, etc. on ‘targeted marketing’ while with Catalina Marketing. The singular issue with ‘classically trained’ marketers is that everything they have ‘experientially’ gained with years of tremendous experience has suddenly become obselete (at least in the application of Social Media). Our instinct (and in some cases self-protectionism) causes many to build on that experience and attempt to retrofit ‘old models’ into the ‘new media’. It doesn’t work!! ‘Old models’ ultimately tell us to ‘push’ our agenda on either a mass or somewhat targeted audience via traditional media choices and paper-dependent incentives (ad features, coupons, DM, etc…). We know these are highly inefficient (FSIs producing <>
A point for discussion is this: Pushing a commercial message is Anti-Social and looses audiences faster than you can change the radio channel or hit fast forward on your TV’s DVR. Social Media, if done right, ‘pulls’ an audience to you. You suddenly find yourself on Page 1 of Google searches. You are engaged with a targeted audience that targeted themselves before you even got to the party. And if you really have that brain surgeon on the team, you can even build businesses and monetize all that chatter…the ultimate goal of business within the SM world."
Tom Nilsen
EVP-Sales & Marketing
10/08/2009
IMPARTIALITY IN PROFESSIONAL PRACTICE
In the delivery of financial services the advisor impartiality with regard to product solutions is the fundamental principle behind a fee for service basis of compensation.
Since the financial services industry compensates financial advisors only upon the sale of a financial product the consumer must be made aware that there are 2 compensation choices available in any client/advisor engagement.
Since the financial services industry compensates financial advisors only upon the sale of a financial product the consumer must be made aware that there are 2 compensation choices available in any client/advisor engagement.
- A client paid fee based upon a financial plan solution analysis with no specific product (brand) recommendations.
- A product solution based upon a financial plan analysis with specific product recommendations. The advisor compensation in this instance is paid for by the financial institution whose product is chosen by the client.
With the full disclosure of the choices availabe the advisor can deliver the impartiality that is the hallmark of professional practice.
LONG RANGE PLANNING
"Long range planning does nor deal with future decisions, but with the future of present decisions."
Peter Drucker
Peter Drucker
10/05/2009
DEFINING FINANCIAL PLANNING HAS BECOME A PRIORITY OBJECTIVE
Setting out a vision statement for the next 10 years, the largest financial planning standards body in Canada held a symposium in Toronto on Monday, where the topic of regulating and defining what it means to be a financial planner was front and centre.
Outside of Quebec, anybody can call themselves a financial planner, and the lack of clarity on what it is to be a financial planner is troubling for the Financial Planning Standards Council (FPSC), which administers the Certified Financial Planning (CFP) designation in Canada. Credentialed advisors are lumped in with unlicensed and alleged Ponzi-schemer Earl Jones, who billed himself as a financial planner.
In fact, a recent poll of advisors conducted on behalf of Advisor Group found that 54.2% of respondents referred to themselves as a financial planner.
In light of Jones — who was invoked numerous times on Monday but never mentioned by name — and other well-known advisor misconduct, the perception of financial planners is likely at an all-time low. To combat this, Cary List, the president and CEO of the FPSC, put forward a number of goals that his organization will try to achieve by 2020. These goals are designed to enhance the credibility and quality of financial planning in Canada.
The goals the FPSC has set out for 2020 include:
• Every high-school graduate has experienced some introductory financial planning curriculum by the time he or she graduates.
• There is a regulatory environment that restricts who can call themselves a financial planner to those who are qualified through a recognized professional designation that has enforceable standards of ethics, practice and competence.
• The industry responsibly promotes financial planning and clearly distinguishes and values financial planning as more than just product advice.<br>• Canadians understand the distinction between investment product advice and financial planning, and "recognize the value and appropriate place for each."
The regulatory issue is arguably the most controversial and complex challenge. Without a regulatory definition of what it is to be a financial planner, the profession has diminished credibility with consumers.
"If financial planning is to become truly valued by Canadians for what is, a way of helping people manage their financial affairs to meet their life goals, the regulatory environment must also recognize that financial planning is separate and distinct from, yet complementary to, product-based advice," List said.
"In most provinces, anyone can call themselves a financial planner. We would like to see a regulatory environment that prohibits advisors from holding themselves out as financial planners unless they’ve demonstrated their competence and ethical commitment to serving their clients’ interest first, so that those most vulnerable are not at the mercy of unqualified, self-proclaimed financial experts."
Gerry Matier, executive director of the Insurance Council of British Columbia, gave a talk at the symposium that outlined both the essential need for and difficulty of defining financial planning from a regulatory perspective.
According to Matier, in the last 25 years there have been two major initiatives at a national level to regulate financial planning separately. Both have failed. Inevitably, such proposals get a lot of pushback from the industry, which tends to argue that higher standards are costly and stunt recruitment efforts.
Matier said that in 2002, his organization put out a white paper suggesting that its members not hold themselves out as planners unless they carried one of a number of recognized designations, such as the CLU, CFP or R.F.P., among others.
There's no enforceable standard that he commented is strange because most of the registered members of his association have one of the accredited designations.
"It's surprising that the industry does not want to go down this route," he said. "I think in the life insurance industry we have more people with designations such as the CLU, CFP, CH.F.P, than any other part of the financial services sector."
Clients don't care
Education about financial planning to the broader public would go a long way in recognizing that it should work with credentialed and licensed advisors. Matier says in the nearly 20 years he's been working as a regulator, it's been almost impossible to implement tangible client education that works.
He says clients are disengaged in educating themselves about the industry and tend to care only when they fall victim to financial misconduct.<br>
The Insurance Council has tried numerous methods to use the fines it levies to promote consumer education, but Matier says that those who show up to the seminars and conference are always "informed consumers."
"Whenever scandals break, it's always considered to be a failure of the regulators. It's never considered to be a problem with consumers," he says. "Consumer education...in the 19 years I've been doing this, I've yet to find a good method of providing financial planning education to clients."
He adds, "The people who turned up were informed consumers. They were people [who already knew a lot] and were looking for one or two extra tidbits of information.
Matier argued that financial planning education needs to occur at the high-school level because older clients just don't seem to care about educating themselves about financial literacy.
"The problem is, the average consumer doesn't look for help until they’re already into the [trouble]," he says. "If you haven't learned at this stage, you probably won't. Likely, the only way you will is if something [unfortunate] happens to you."
Mark Noble
Advisor.ca
10/05/09
Outside of Quebec, anybody can call themselves a financial planner, and the lack of clarity on what it is to be a financial planner is troubling for the Financial Planning Standards Council (FPSC), which administers the Certified Financial Planning (CFP) designation in Canada. Credentialed advisors are lumped in with unlicensed and alleged Ponzi-schemer Earl Jones, who billed himself as a financial planner.
In fact, a recent poll of advisors conducted on behalf of Advisor Group found that 54.2% of respondents referred to themselves as a financial planner.
In light of Jones — who was invoked numerous times on Monday but never mentioned by name — and other well-known advisor misconduct, the perception of financial planners is likely at an all-time low. To combat this, Cary List, the president and CEO of the FPSC, put forward a number of goals that his organization will try to achieve by 2020. These goals are designed to enhance the credibility and quality of financial planning in Canada.
The goals the FPSC has set out for 2020 include:
• Every high-school graduate has experienced some introductory financial planning curriculum by the time he or she graduates.
• There is a regulatory environment that restricts who can call themselves a financial planner to those who are qualified through a recognized professional designation that has enforceable standards of ethics, practice and competence.
• The industry responsibly promotes financial planning and clearly distinguishes and values financial planning as more than just product advice.<br>• Canadians understand the distinction between investment product advice and financial planning, and "recognize the value and appropriate place for each."
The regulatory issue is arguably the most controversial and complex challenge. Without a regulatory definition of what it is to be a financial planner, the profession has diminished credibility with consumers.
"If financial planning is to become truly valued by Canadians for what is, a way of helping people manage their financial affairs to meet their life goals, the regulatory environment must also recognize that financial planning is separate and distinct from, yet complementary to, product-based advice," List said.
"In most provinces, anyone can call themselves a financial planner. We would like to see a regulatory environment that prohibits advisors from holding themselves out as financial planners unless they’ve demonstrated their competence and ethical commitment to serving their clients’ interest first, so that those most vulnerable are not at the mercy of unqualified, self-proclaimed financial experts."
Gerry Matier, executive director of the Insurance Council of British Columbia, gave a talk at the symposium that outlined both the essential need for and difficulty of defining financial planning from a regulatory perspective.
According to Matier, in the last 25 years there have been two major initiatives at a national level to regulate financial planning separately. Both have failed. Inevitably, such proposals get a lot of pushback from the industry, which tends to argue that higher standards are costly and stunt recruitment efforts.
Matier said that in 2002, his organization put out a white paper suggesting that its members not hold themselves out as planners unless they carried one of a number of recognized designations, such as the CLU, CFP or R.F.P., among others.
There's no enforceable standard that he commented is strange because most of the registered members of his association have one of the accredited designations.
"It's surprising that the industry does not want to go down this route," he said. "I think in the life insurance industry we have more people with designations such as the CLU, CFP, CH.F.P, than any other part of the financial services sector."
Clients don't care
Education about financial planning to the broader public would go a long way in recognizing that it should work with credentialed and licensed advisors. Matier says in the nearly 20 years he's been working as a regulator, it's been almost impossible to implement tangible client education that works.
He says clients are disengaged in educating themselves about the industry and tend to care only when they fall victim to financial misconduct.<br>
The Insurance Council has tried numerous methods to use the fines it levies to promote consumer education, but Matier says that those who show up to the seminars and conference are always "informed consumers."
"Whenever scandals break, it's always considered to be a failure of the regulators. It's never considered to be a problem with consumers," he says. "Consumer education...in the 19 years I've been doing this, I've yet to find a good method of providing financial planning education to clients."
He adds, "The people who turned up were informed consumers. They were people [who already knew a lot] and were looking for one or two extra tidbits of information.
Matier argued that financial planning education needs to occur at the high-school level because older clients just don't seem to care about educating themselves about financial literacy.
"The problem is, the average consumer doesn't look for help until they’re already into the [trouble]," he says. "If you haven't learned at this stage, you probably won't. Likely, the only way you will is if something [unfortunate] happens to you."
Mark Noble
Advisor.ca
10/05/09
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