A recent article we wrote in Professional Advisor stimulated a big response. In the article we debated the benefits of using Financial Planning technology in front of the client; quoting the example of Peter Matthew of Penzance. Peter uses Voyant to analyse client information and produce a cash flow forecast and financial plan. He then plays the plan back to his clients via the computer, projected onto a large screen. He says that the effect is impressive and clients gladly pay him his fees. He therfore believes that he is adding real demonstrable value to the process of purchasing financial products – he is providing true advice.
Following the publication of the article, I was contacted by Eric Mackereth of Planlabs who raised the concern that using the technology in front of the client was potentially counter-productive. He quoted a colleague of his, from across the pond, describing the US experience thus:
“In the US, many years ago firms and the industry worked feverishly to develop point of sale face-to-face interactions but clunky technology and the changing variables that would result left many advisors being shown the door with no sale in hand. Advisors are more comfortable collecting facts at point of sale and returning with a well thought out plan. Consider one challenge, if you enter data face-to-face, both the advisor and consumer see it for the very first time together. The advisor literally loses control of the planning process and now must react swiftly in many circumstances to save face. Another challenge is the inconvenience technology poses face-to-face. The advisor has to setup, get booted up, all this takes time, valuable time to interact with the consumer in a non-intrusive way. When the computer screen is face up, in many instances it places a barrier between the advisor and consumer.”
The Planlabs position is not uncommon, indeed many advisers over the years have expressed similar concerns to me. Ultimately if an adviser is uncomfortable with using technology in front of the client then Planlabs are right and they shouldn’t do so. However, as a consumer of financial advice, I can’t shake the fact that I personnaly would like to receive the Peter Matthew’s approach to financial planning much more than a paper based approach. So I threw the question of which approach was preferrable out to a Twitter community. The response surprised me as it was unanimous – the tools are at their most effective if used in front of clients – none of the normal resistance I see from IFAs. Now this might be that as the respondents were active Twitter users, they are very comfortable using technology. However, it does show there are advisers that are going to use these technologies to the full extent and that should not be ignored.
After my informal poll on Twitter, I was then called by the Paul Etheridge who as well as being a Financial Adviser of some repute, is also the Chairman of Prestwood Software that produce ‘Truth’ (the market leader in Financial Planning Software). He had read the article and was phoning from Spain to say that he has used Financial Planning software in front of clients for years and would recommend that advisers receive the appropriate training to help them get to a level of competence that they can feel confident and competent to actively engage wit the customer, as that is where such systems are at their most powerful.
The reality is that both positions are fair, depending on the level of IT and Financial skills. I suspect different systems will support different choices of use too. Voyant and Truth are very Graphical tools,so they support the ‘in front of client’ process well. Planlabs has a very strong reporting tool, so supports the process of returning with a paper report better than some (although Truth is strong here as well). Therefore, in deciding which tools are best for advisers it is vital to consider which approach is likely to be taken when evaluating the systems, how confident you will be as a user and what approach willl support the relationship with your customer .
