The FSA Update that was issued in April 2008 in response to the feedback on DP07/01 has not been met with the public outpouring of negativity that occurred last year! This may be for a number of reasons, including a belief that it is the right approach, a number of people not having read it, a number not having considered its implications on themselves, some may be waiting for the ‘Feedback Statement’ in November [and subsequent proposals likely in the New Year] and a number may simply not believe that it will happen…
Those who haven’t read it, considered it and looked at the potential impact on their business model really ought to do so. Why… because this could be a ‘car crash’ for your business model.
Here are just a few questions to think about:
» What is your existing business model and does it deliver what you want in a way that you want?
» Will your existing model easily fit with the current FSA outline of how future distribution might work?
· If it does, how do you think that others will adapt to the new structure and what impact will that have on your business [‘the only constant these days is change!’]?
· Will it increase or decrease competition, will it affect your revenue and profitability, how will it affect your customer base and will there be any positive or negative brand implications?
» If your current model doesn’t fit, what will you do?
· Have you considered how you could change your business?
· Would a changed business model meet your strategic objectives, would it require major or minor change, does it fit your culture, would it be cost effective, how long would transition take?
· If you don’t agree with the possible changes to you business that you would have to make, how will you lobby changes to the FSA proposals?
» How will suppliers of services such as technology, Compliance and T&C have to adapt?
· Will the range and depth of advisory support coverage currently offered by POS systems and Wrap
· Will there need to be greater emphasis on research tools that provide qualitative as well as quantitative comparisons?
· Will there be a need to change back-office systems to deal with a wide range CAR combinations?
· How will technology be used to support the non advised ‘Assisted Sale’ approach?
· How can technology be used to help ensure that all parties act in a compliant manner and provide an auditable record of this in a cost effective way?
We have heard a number of views expressed from various parties in the industry and have been surprised at the lack of knowledge or degree of indifference. Even those who think that they are well placed to cope in a post RDR world may find that they are affected by how others do or don’t react – whether that be potential competitors or those that currently provide support to them! It is better to be forewarned and forearmed…
