How to become a connected SMSF adviser

In late 2014 I attended the Xero Roadshow and was blown away by a presentation by Xero’s Steven Leaney on the journey to become a ‘connected adviser’.

I would define a connected adviser as: Any relationship professional who has leveraged technology and re engineered their business to make themselves invaluable to their chosen brand of client and in doing so creating almost unlimited opportunities for growth.

Although definitions may vary, the concept of using technology to create service offerings which make you the go-to guy (or girl) for your particular niche sounds pretty cool right? Delivering something that the clients you love working with will pay you handsomely for.

The following table compares a traditional advice (accounting) business to that of a connected adviser:

How to become a connected adviser | Superfund Wholesale

The presentation got me thinking, how can an adviser (financial planner, accountant, administrator etc.) working in the SMSF space apply the same principles and become a ‘connected’ SMSF adviser?

Applying the principles learnt from Xero, there are three key things an SMSF adviser must do to transform into a connected adviser:

  1. Identify your ideal clients
  2. Get your clients into the cloud
  3. Leverage and automate everything

Identifying ideal clients

This concept is nothing new so I will not rehash generic information about identifying and targeting a specific niche market.

What I will say is that to become truly connected with the niche you want to work with, you will need to ensure you adequately communicate not just how and what services you provide – but why you do what you do.

The best resource I can provide is this (edited) TED Talk video from Simon Sinek.

The idea is to ensure the clients you will be attracting and providing fantastic cloud based services to the clients that you as the adviser actually want to work with!

Get your clients into the cloud

The core of any SMSF service offering will rely on getting your clients SMSF accounting information into the cloud. Xero is the market leading the small and medium business cloud accounting space in Australia however currently does not have an SMSF product.

Class Super is the Xero equivalent when it comes to SMSFs. Although there are a handful of other providers, Class is definitely the most advanced and connects to the Xero ecosystem via an integration with Xero Practice Manager (formerly WorkflowMax). It is also worth noting that the majority of large SMSF administration businesses use Class Super.

From an SMSF advice perspective, a cloud solution provides the following benefits:

  • Access to the clients financial records anytime from any device
  • Accounts kept up to date through automated data feeds from banks, brokers and investment platforms
  • Single ledger means everyone can work on and advise from the same information (accountant, auditor, adviser, client)
  • Integration with other cloud planning tools such as Xplan
  •  
    In addition to using Class (or an administrator who uses Class) for your clients SMSF accounts, to become a connected SMSF adviser you need to look at cloud solutions for other aspects of your business. Your planning software, document management, CRM and marketing tools can reside in the cloud and you will need the flexibility the cloud provides to truly create the business you want.

    Leverage and automate

    This is where the fun begins. The connectivity the cloud provides enables opportunities to leverage the investment in cloud technology to automate routine processes within a business, creating efficiencies and the ability to take on more clients with the same number of staff (even for a sole practitioner) or to go deeper and provide more services to existing clients.

    Let’s look at the following example: A small financial planning practice differentiates itself by providing a small number of proprietary direct equity model portfolios to their SMSF client base. The process of re balancing client portfolios every time the model changed was manual and cumbersome, and took considerable staff time. Each trade had to be manually calculated on spreadsheets and the trade orders submitted individually to the broker.

    In addition the advisers within the practice always struggled to provide advice on the fly to the SMSF clients as they always had to cobble together ‘best guess’ information by combining out of date financial statements with transactional and investment data to get an up to date picture of each SMSF.

    An alternate cloud based solution this practice could use would include:

  • Utilising an SMSF administrator to move all their clients accounting onto Class Super
  • Plugging their models into a portfolio tool such as Financial Simplicity
  • Changing to a broker that could receive bulk orders generated from Financial Simplicity as well providing a data feed to Class Super
  •  
    Leverage Class Super | Superfund Wholesale

    Working in a clockwise direction starting with the adviser at the top of the above diagram, the integrated cloud technologies would come together as follows:

    1. The adviser would load their proprietary model portfolios (intellectual property) into Financial Simplicity
    2. Financial Simplicity would pull in details of the SMSF clients’ portfolios from Class Super and compare to the applicable model (determined by the adviser) to calculate the trades necessary to re-balance the portfolio
    3. Advice and compliance documents generated for clients and orders required to re-balance client portfolios pushed through to broker for execution in bulk
    4. Broker provides data feed of transactions and holdings to Class Super
    5. Adviser accesses up to date client portfolio through Class’ FundWeb online reporting or via the reporting integration with Xplan

     
    The above is just one example of how the cloud can be leveraged to enhance business efficiencies and service levels. There are many other areas within an SMSF advice business where other cloud and integrated technologies could be used including:

  • Billing and fee collections
  • Quoting and fee agreements
  • Review appointment scheduling and reminders
  • Marketing and client education
  •  

    Bringing it together

    Both the financial services and accounting professionals are in the midst of major disruptive change being driven from technology. With change comes opportunity and by leveraging cloud technologies SMSF professionals have the means to re-engineer business models to reach new clients or reinvigorate and deepen existing client relationships.

    Don’t let yourself be a servant of what is – become a shaper of what might be!

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