Adam Fayed, CEO of adamfayed.com.
While you might assume being disagreeable is a bad thing, sometimes, being disagreeable can have its benefits and could even affect one’s income. From my perspective, disagreeableness doesn’t need to mean you’re hyper-aggressive in all situations. It can merely mean you’re being assertive in certain cases, which can cause discomfort. This discomfort can sometimes be caused by breaking industry norms, for example.
For business owners in financial services and beyond, this kind of disagreeableness is sometimes necessary, provided you pick your moments to also be agreeable. As the old saying goes, you can’t make an omelet without breaking an egg.
One time I’ve found it can be particularly important to be assertive is when a financial advisory company is deciding which investment provider or platform they use to manage investments. Otherwise, they could end up choosing a solution that doesn’t fit their or their clients’ needs.
Financial advisors and wealth managers—whether in the expatriate market, which I frequent, or locally—will typically not hold clients’ money directly. We all deal with third-party providers such as banks, life insurance companies, investment platforms, private equity firms and more. This makes sense because it can help reduce the risk of fraud.
Like all companies, many of these third-party providers will have their own processes, self-interests and ways of doing things. In reality, I’ve experienced two types of providers: There are those that have more restrictions, often due to regulations, and might want more of a say in things like the content you put online. And then there are providers that are often newer and a bit more laid back but are still compliant and offer associated investor protections. In my experience, many older and traditional life assurance and investment platforms often have much more stringent processes than alternative asset providers and newer companies. For instance, when I first came into the financial services industry, most providers wanted wet signatures on client application forms.
Since then, I have personally decided to work with providers that could do everything online or via very simple application forms. But, I’ve also seen many advisors who believe working with traditional and “big” investment platforms and providers is the only way to go. I have even encountered advisors who prefer to deal with providers in a specific jurisdiction. Yet, nontraditional and newer providers have become very popular within my client bank as well because I’ve observed some traditional investment providers have increasingly placed restrictions on alternative asset classes, which gives the advisor fewer investment choices.
There are clear benefits associated with dealing with investment platforms and life assurance companies. They allow clients to see their assets in one place. They also allow an advisor or advisory company to show their assets under management to potential buyers. Yet, in a changing world, I believe companies should be careful about which platforms they give business to. I’ve seen some firms revoke distribution agreements if firms weren’t regulated a certain way, for example.
Ultimately, I’ve found that the bigger, more powerful and more traditional the investment provider, often, the less likely they are to be flexible with the advisory company. However, it is true that newer, or alternative, investment platforms have their drawbacks as well. Their systems are not always as developed, for example, so clients might not trust them as much in certain cases. For these reasons, one might choose to deal with well-established firms that are just as big as traditional players but are more modern. For instance, a relatively big 20- or 30-year-old investment platform is more likely to be flexible and forward-thinking compared to a 200-year-old life assurance company, even with the same amount of AUM and investor protections.
Ultimately, the best way to decide which is the best fit for your advisory company is to ask the provider the right questions. In particular, what processes do they have in place to help companies, and clients, reduce bureaucratic processes? What investor protections do they have?
Companies can only really know which options are better for their needs by measuring revenue, profitability, client satisfaction and time saved from using different providers. It is also important to give any new providers time because there can always be teething problems in the early stages of a relationship.
Ultimately, there are many positives about investment platforms—old and new—but advisors and companies should also be aware of potential negatives. In the financial services industry, being able to say no to a provider and switch to one that better suits your needs is priceless.
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