What do clients want from their financial advisors? 

That question is a regular topic of conversation on my podcast, Bridging the Gap.

The short answer, according to the experts and innovators who visit my show: More.

The trickier question is, how can financial advisory firms deliver on that increased client expectations without weakening the business’ bottom line?

Thanks in large part to the transformative effect of the internet, consumers now expect to get what they want, when they want it. When it comes to our industry, those wants include increased interaction with their advisor, near-instantaneous responses when they contact the firm, and rapid access to information and documents. An increasing number of time-starved clients also crave the convenience of working with an advisory firm that can handle all their financial guidance needs, including estate and tax planning.

Oh, did I mention that clients want to receive all of this added value at no additional cost?

Thanks, Internet.

I have no doubt our industry will continue to meet or exceed all client expectations. But toeing that line will require additional expenditures, including high-dollar line items such as expert team members (tax lawyers, estate planners), and more office space. Those added costs, combined with an inability to raise fees, could put significant downward pressure on a firm’s margins.

How do we combat that threat?  With technology and innovation. Hiring more and more advisors and support staff isn’t the answer. That approach will only add stress to the margins. Instead, we should harness carefully chosen digital tools and systems innovations to free team members from routine, repetitive tasks. Such chores likely consume far too many of each staffer’s 2,080 annual work hours.

Start the process of preparing for the future by detailing every process your firm executes. Analyze the component steps of each process, including who handles each task and how much time it requires. Then figure out how much time would be saved if some steps could be either handled by technology or outright eliminated by innovations to the process.  Existing staffers can use all those salvaged hours to super serve clients, and to develop new skills that will enhance their value to those clients.

I’d love to hear about your experience with client expectations and margin pressure. Have you begun enhancing and expanding your firm’s offerings?  If so, how has it impacted your margins?

Is your firm using technology to boost operating efficiencies?

I believe this a critical topic for our industry. Let’s have a conversation about it.