Practice Management

Difficult Advisory Environment Demands a Strategic Vision

Conventional thinking about product packaging and distribution just won’t cut it in tomorrow’s retirement advisory industry. 

By John Manganaro | January 31, 2017
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During a recent and wide-ranging conversation with PLANADVISER, executives at Lockwood Advisors, a Pershing affiliate backed by BNY Mellon, sounded unapologetically optimistic about the future prospects for registered investment advisers (RIAs) and their supporting service providers.

Lockwood Chief Investment Officer Matt Forester and Chief Operating Officer Joel Hempel both admitted there are many challenges ahead, too. The regulatory landscape is more or less impossible to forecast, they note, while global market forces have put a real damper on long-term investment return expectations.

What are the sources of optimism? Individuals’ understanding of what financial advice is and can be has started a fundamental shift, and at the same time new technologies are presenting powerful opportunities for providers to increase scale and efficiency while also boosting the client deliverable. Faced with such a complex but high-potential environment, Hempel candidly admits his firm is in the midst of deep self-analysis.

“In general, being part of a big organization has a lot of benefits and a lot of downsides,” Hempel says. “For us it has been more of a benefit and we expect that will be even more so in the future, because of the critical importance of distribution efficiency and reach. We work with some 800 to 1,000 financial intermediaries via Pershing, which is a huge opportunity for us in this emerging environment.”

Like other firms, Lockwood is “reassessing our product set and building out very clear and straightforward ways to combine and offer our core capabilities, which include investment research, asset management and delivering a turnkey managed account solution.” 

“There are a lot of firms that work in this space and I can tell you many of them are having the same internal discussion,” Hempel says. “For all of us, the turning point in the discussion is, how efficiently can you do it and how clearly can you communicate to clients what value you deliver for the price?”

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