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Remove all conflicts of Interest? You’re Dreamin’​!

Remove all conflicts of Interest? You’re Dreamin’​!

It is unfortunately too easy to find trade press reflecting the wrong-doing of an individual or organisation in the financial markets. Should the nature of any indiscretion or activity be measured by degrees, or is it outright fraudulent? Is being ignorant of “Best Interest Duty or Reasonable Basis” any better than knowingly disrespecting this lawful responsibility when a financial adviser? A recent article was titled “The idea that commissions are not conflicted is akin to the argument that guns don’t kill people“. Having read the article it made sense to me and is clearly consistent with the direction of the industry. Interestingly, in reading to the end, the author represents an association that supports independent advice (and names his individual business also). This is the world of educational/content marketing as a means to an end – in this case to grow their membership and promote his business as a responsible independent service. Arguably, is it not a subtle conflict of interest to write this article as it promotes the association and his business? Conflict of interest is difficult to avoid. Not just for the financial planning industry & the nature of human behaviour is that people lie. In fact, a fantastic documentary titled “(Dis)Honesty – the Truth about Lies” (Available on Netflix) is a great depiction of human behaviour. It features individuals sharing their stories on the outcomes of their lies (at the time they lied, it was seen in some circumstances as in the best interest of themselves, their family and not hurting anyone else). People lie to protect themselves, not look foolish, avoid conflict, to preserve something they...
Scarcity of Experienced Financial Planning Talent – It’s Coming

Scarcity of Experienced Financial Planning Talent – It’s Coming

If you think it’s already here, there’s a way to go! The proposed educational changes (new and existing authorised reps – AR’s) have been introduced to Parliament. Turnbull has also weighed into the discuss. Over the last 12+ months, change has already begun with many licensees moving to minimum education standards that mirror proposals for the authorising of all new financial planners. These proposed (and expected) changes will impact FP businesses in two ways: A number of ageing financial planners who don’t meet the new minimum will choose to retire from delivering advice at some point before 2024 (or the date that is ultimately agreed). Many new entrants to the industry will come from young graduates similar to professional services today. As we know from accounting and law, pathways to delivering advice do not happen overnight. It takes many years of experiential learning, continuous education and engagement before advice is independently delivered. These two factors will create a “Scarcity Window For Talent” if the industry does not prepare as we progress towards being recognised as a profession. And with scarcity comes opportunity Opportunity for those experienced, well educated business owners and advisers with demonstrated ethics and quality technical and engagement skill. Opportunity for new entrants with a focus and belief that professional advice can be delivered by the industry. That they are the future. Di Johnson, Professor Mark Brimble from Griffith University and Zanetti Recruitment & Consulting have collaborated and recently published a paper in the Financial Planning Research Journal titled “Industry demand for financial planning graduates” – Click on this link for the full report.   The research...
What do clients value most about financial planning?

What do clients value most about financial planning?

Griffith University is updating research on the benefits of financial planning for clients, to highlight the reasons that clients stay with the planner over the short/long term and the value that they get from establishing and maintaining a relationship with their financial planner. If you are a client of a financial planner, or run a financial planning business and would like to forward the survey on to your clients, the link to this 5 minutes survey can be found below. The survey is completely anonymous and voluntary.  The research will highlight the benefits of financial planning from the clients’ perspectives, and map the mix of reasons that clients maintain a relationship with their planner. The survey will close on 30 November 2015 Please click here to take part. Thank you for your potential input and assistance, a large response will give us greater detail and evidence of the value of financial planning for clients. If you would like a preview of the questions, please email m.brimble@griffith.edu.au for a PDF. copy. A report will be publicly available early in...
Why Recruitment for Small Business Sucks – Part 2

Why Recruitment for Small Business Sucks – Part 2

Some weeks ago I posted the recruitment experience of a small business owner. There were some common themes that came from his experience. Losing a staff member without a resourcing plan created an urgency to replace the resource before it has an impact on client service, productivity and team morale. Speed to market to replace a resource compromised process and better judgement in hiring decisions. Not the only theme but clearly one that stood out. Whichever way you choose to recruit, getting it wrong can have long term financial impact on the business and cultural consequences within the team. If you didn’t see the first post, it’s a quick, 3 minute read worthy of review before moving on. We now look at what to consider when creating an in-house recruitment resource or outsourcing to a competent third party. We’ll also introduce a recruitment philosophy that doesn’t compromise productivity. That is to build and manage an “Ongoing Talent Pool”. Like most things in life, achieving the best outcomes only occur with personal and professional development, effort and growth. Hiring with speed can be achieved but it doesn’t mean falling in love with a candidate’s compelling personality in the first interview & making an offer. If you do believe the individual satisfies your requirements, you shouldn’t dabble in due diligence & management of the process. Before we look at what you should do to improve your recruitment effort in the longer term, you still need to fill gaps in your team today. A few “quick” tips when managing your current recruitment process Don’t let industry experience alone influence your decision — Employers can...
Why Recruitment for Small Business Sucks – The reason why it can be challenging!

Why Recruitment for Small Business Sucks – The reason why it can be challenging!

Small business has many challenges. The greatest one we experience is the attraction & retention of the right people. As a business owner (and also engaged to support businesses to source culturally aligned competent staff) I know it can be a roller coaster ride. Some think it’s best defined as an art wrapped in some science. No doubt emotional intellect, due process, assessment tools, the right questioning and assessment all play a part. What’s common from our experience? Most think recruitment sucks. It’s too time consuming to properly do in-house and too expensive to outsource. But these are the two choices small business owners have (excluding iterations of both). But these are the two choices small business owners have (excluding iterations of both). The principals/directors learn how to effectively recruit talent for their business (or educate & charge a team member with that responsibility). Outsource to a competent third party. I suppose there is a third choice. That is to recruit the way you always have. A sales manager I worked with over 25 years ago always said; “The more you do of what you’re doing, the more you’ll get of what you’ve got!” If it’s not working for you today, then this really is not an option! Whichever way you choose to recruit staff, getting it wrong can have long term financial and cultural consequences. To quote Jim Collins: “getting the right people on the bus” is the first step. “Leaders of companies that go from good to great start not with “where” but with “who.” They start by getting the right people on the bus, the wrong people off the...
Why some staff WILL leave you

Why some staff WILL leave you

It’s not always for the right reason but sometimes no matter what you do, it’s inevitable. Working conditions, salary level, conflict among staff, moving to a new location, career progression not available, head-hunted, recognition and reward above salary, lack of autonomy, respect and more could be sited as reasons. As a small business owner, management, leadership and continuous communication with staff is not easy within the total demands of your business. We don’t always get it right either. And that’s OK, as long as we learn and improve. What happens every day – you just don’t see it Recently a client called to discuss a staff member who approached them to respectfully challenge their remuneration package. “The catalyst was an advert on Seek. Where can employees gain misinformation? One place is a job advert!” The staff member was a Client Service officer of an SME Financial Planning firm and the advertisement touted a $15,000 greater package for what appeared to be exactly the same role. Trying to put myself in the employees shoes, the spin going through my head could include: I’m being underpaid and if so, the employer doesn’t value my effort. That extra money would go a long way to reducing my HECs debt or give me that surf trip I want to the Mentawais next year! I wonder if the rest of the team are being paid more than me? I know I put in as much time and effort as everyone else. My employer just spent 5 weeks overseas on what looked like a great trip after the dealer conference. I’m probably paying for that....