Thoughts on Advice Models After a Career in Software

Phil Cunningham, CEO of Advicent, spent most of his working life in software and technology.

“Prior to joining Advicent, I did not come with much financial expertise, to be honest,” he tells PLANADVISER. “My focus was on consumer-facing software.”

It used to be fairly exotic background, as financial services executives go, but it’s now an increasingly common story. The reason? There has been a gap between what modern, technology-oriented consumers want and what the traditional financial services industry has been able to offer in terms of client-facing solutions. Now there is a veritable arms race among big and small providers alike—all of them seeking the next breakthrough in advice delivery.  

“Looking back to 2014, when I joined the company to help pilot our move to become an independent entity under the Advicent name, we have seen very strong turnaround in our business, quite candidly,” Cunningham says. “Today we have over 100,000 advisers on our planning platforms, but I will be the first one to note that prior to our rebrand we were not as successful in this portion of the market. I think this recent history gives us some important perspective on what advisers are seeking right now in terms of technology and support.”

According to Cunningham, the vast majority of advisers working with Advicent are “seeking to grow their practices while also significantly improving efficiency to address new pricing demands.” This is one of the main sources of Advicent’s recent success, he speculates.

“When you think about what an adviser has on his or her mind, they are looking for ways to grow their client base, to transform prospects to long-term clients that can be serviced with the most efficiency possible,” he says. “To do this, advisers tell us they need anytime, anywhere access to a clients’ financial plan and data, and they need tools and solutions to process the data on demand. They are facing more service demands than ever before, and so they are seeking efficiency, especially for repeatable reporting and administrative tasks.”

Advicent’s most recent response to these demands is the rollout of the Narrator toolset, Cunningham explains.  

“The Narrator toolset is our response—it’s an adviser portal and dashboard toolset entirely focused on adviser efficiency,” Cunningham says. “It’s all about efficiency in the day-to-day aspects of the job, to allow more time to interact with clients. Practically all of the advisers we ask tell us that they still believe their fundamental function is creating a financial plan for individual clients. Regardless of what type of adviser you are, it is around this financial plan that you are going to be selling or recommending any products or strategies. Thus, advisers want efficiency in creating and maintaining the fundamental financial plan.”

NEXT: Building and delivering efficient plans 

“Your audience will know that one of the most time-consuming and therefore difficult parts of building individual plans for an increasingly large and complex book of business is the data-gathering,” Cunningham contends. “The financial plan must have great data and it must be keyed in correctly to create a plan. The opportunity we see, then, is helping advisers offload some of the data gathering, easing the management of the client information and bringing efficiency to the development of the clients’ individual goals and aspirations.”

He likens the effort to cutting down on the homework advisers have traditionally had to do in the wake of client meetings and communications. To this end, the Narrator portal “creates a scenario that continues to engage a client more and more in developing their own profile directly on the portal, but they are also developing their goals in a very collaborative, sit-down environment with the adviser. The result we push for, then, is allowing the adviser to maintain the critical face-to-face time with clients, while also taking away the homework that normally comes after the meetings.”

Because the client and adviser do the actual work of crafting a plan on the portal during the meetings, the adviser can operate very efficiently, and get away from the old-school approach of having to go home and key everything in.

“Profitability is built because we help advisers review and understand the ROI of their own planning solutions,” Cunningham adds. “We help them look at the ROI of their current solution and what it could be if they leveraged a different approach, such as our portal solution. We get critical. The balancing act is making sure clients are not feeling like, ‘Okay I’m being charged for an adviser service but I’m really just being served by a robot.’”

Cunningham concludes the next phase of development in the advisory industry will indeed be driven by the technologically minded side of the business.

“The future is about having the adviser utilize the data and utilizing the technology for the benefit of the client—rather than being replaced by the technology,” he adds. “It’s building something in between the full-fledged robo-adviser investment management tool and the traditional adviser model that is based on face-to-face episodic interaction with clients. The seam where these two come together, call it a hybrid adviser or whatever other buzzword you want to use. Keeping the adviser front and center but allowing the client to have their own amount of control and self-service. That will trump the pure robo experience any day of the week, we believe.”