Harry Dalessio

PA: Our business is changing rapidly, as is the role of the adviser. Talk a little about some of those changes and the roles that advisers will play going forward.

Dalessio: From a macro perspective, the lifeblood of our business is advisers. All of our business is intermediated, and advisers continue to play a more critical role with their clients.

For advisers in general, the number one thing we see them focused on is the differentiation. Their marketplace has become more and more competitive. Advisers need to demonstrate their value-add, and demonstrate that they’re delivering outcomes for their clients and their participants.

PA: What are some things that you can do to help advisers in that space?

Dalessio: Certainly we’re confident in our product innovation and really focused on creating solutions for the challenges that exist in the marketplace today, but for the last 18 to 24 months, a lot of the work we’ve been doing for advisers has been around their value-add and how they differentiate themselves. We’ve really been focused on three things.

First, the industry needs leadership now more than ever, and advisers are on the front lines of doing that. Second, how do we change the conversation? How do we help advisers better connect with plan sponsors and their participants to drive the right behaviors?

Third, we use so much jargon in our business, how do we humanize it more? How do we better connect with the end user?

The approach we’ve taken with advisers has been around helping them build their practice by providing them with the tools they need to be winners in a rapidly consolidating market.

PA: Prudential is an obvious market leader in the retirement income space. How does that play with the adviser community?

Dalessio: Retirement income has seen an evolution as it relates to the institutional side of the business. At the retail level, retirement income has been a prominent solution for a long time.

For advisers, their clients’ participants are living longer. With that, a few things come to mind. Retirement planning got that much harder. Retirement income is going to have to last a lot longer than anyone had predicted. So, I think that there are varying camps in the evolution of retirement income in the defined contribution (DC) market, but we expect that to be a continued growth market over the next five years. 

PA: So, from a Prudential standpoint, the adviser is only going to be more important in this dynamic. It’s a trend that’s not going away.

Dalessio: Given the complexity of retirement plans, the continued conversation around fiduciary oversight and decision making, everyone is looking for an additional partner to help guide them through that process.

So, our entire business, whether it’s the DC business, the defined benefit (DB) business, the non-qualified business, income, pension risk transfer, stable value—every one of those businesses is built around the adviser being front and center. Part of my role is to ensure that our all of our associates are focused on the ultimate end user, which is the adviser first, the client and then the participant.

The quality of advisers and the continued concentration of retirement specialists has done wonders for the industry. The adviser community is consolidated, there’s depth of expertise, they’re focused on the right issues, and they’re driving tremendous outcomes.

I think that partnership between sponsors, advisers and vendors will continue to solidify because those are the three legs of the stool to drive ultimate success long-term.

Keynote speaker Harry Dalessio spoke about three opportunities for advisers to grow their businesses: the opportunity to lead clients rather than just provide services to them; the opportunity to change the conversation; and the opportunity to show your humanity while tapping into theirs.

The single greatest challenge that advisers face is inertia, Dalessio said: “The antidote for inertia is action, and action requires leadership.” While not all people are meant to lead, those who do will “reap the benefits of driving stronger outcomes for their clients and ultimately differentiating [themselves] from a competitive perspective.”

In order to change the conversation, Dalessio said advisers must approach plan discussions with the idea of “we want it now” participant behavior. Rather than delay their reward, many pre- and post-retirees want their funds immediately. “This is the human behavior we go up against every single day,” he said. He stressed that in order to have the most effective dialogue, advisers must keep this in mind when shaping their meetings with participants.

Dalessio ended by explaining the importance of storytelling to help advisers connect with their clients. While advisers understand the industry jargon used to discuss plans, the average worker does not. In these cases, he said, stories can be used to illustrate the benefits of sitting down with an adviser to create a financial plan—and leave participants wanting more.