As one of the highest-profile financial planning licensees in the country, Commonwealth Financial Planning (CFPL) more than most acts as a proxy in the public mind for the entire financial planning industry.

Commonwealth Bank executive general manager of advice Hugh Humphrey says the organisation is acutely aware of the scrutiny the financial planning industry is under.

He says the volume of work CBA has done to address its own past failings may not be immediately obvious to outsiders, but it will show its value over time.

“The industry is in a large part going to be defined by how well CommBank responds to all the issues of the past,” Humphrey says.

“And I do feel like it’s incumbent on us to drive it harder than anyone else would. It’s going to be a long time before people appreciate the nature of the changes that we’ve made in the business, but we’re confident about what we’ve done.

“Everyone is energised about getting there.”

Humphrey says there are common issues (see below) that all licensees should focus on, and address successfully, so they can support advisers appropriately as the industry changes around them.

 

This is the future
Five things all licensees must get right
1. Help planners to connect to (and be inspired by) a sense of purpose in the business – get clear on the “why”.
2. Be continually attentive and responsive to the needs of customers.
3. Plenty of communication and engagement, particularly in the current context.
4. Set a higher bar to meet community expectations for standards than simply meeting the regulatory and legislative baseline.
5. Spend your time and effort projecting forward to the future, rather than defending past practice.

 

Humphrey says Commonwealth Financial Planning, announced by CoreData last week as the Institutionally Branded Licensee of the Year for 2018, has worked to remediate past advice failures, and to reshape the firm’s value proposition around the concept of helping customers “plan for the best” and prepare for the worst.

This has been accompanied by technology projects to begin digitising elements of the customer experience, and to improve the planner experience. It is testing a digital customer fact find and is about half way through a migration from Coin to Xplan and integrating it more tightly into the bank’s central customer relationship management systems.

Humphrey says the bank was surprised with some results about how customers perceive its services. Strong Net Promoter Scores from those who had just received advice and from those who had just experienced a review meeting weren’t surprising, but it didn’t expect to also get high scores from customers who’d met with a planner but discontinued the advice process.

“When we dug into that we discovered that customers are valuing the opportunity to have a conversation with an expert, and what they need from advice isn’t what people traditionally know it to be,” Humphrey says.

“People are getting help and assistance and having a useful conversation and saying, ‘that was great’.

“And that’s causing us to rethink: does advice always have to be statement of advice or a record of advice, or are there service that we provide that are a conversation, and that’s what we set out to do? That’s an insight we need to respond to.”

Humphrey says this gives the bank an opportunity to re-focus on measures that enhance results for customers, “focusing on this sense of customers getting the results they want and the outcomes they’re looking for”.

Humphrey says making careful and deliberate decisions about what not to change has been as important as the changes that have been made.

“There are so many moving parts just generally around the industry – education standards, regulation, complaints handling – and it’s reassuring to people to be quite deliberate about things that you are not moving and to provide some degree of certainty and predictability,” he says.

“We’ve had really positive feedback around just leaving a few things alone.”