The Adoption Challenge in Financial Planning

For over a decade, financial services firms have been working to drive the adoption and consistent implementation of financial planning by their advisors.  While literally millions of dollars are spent by firms each year in the acquisition of the planning software and all the related infrastructure and support that comes along with a financial planning strategy, the reality is that the adoption and integration of financial planning as a central element of how advisors work with clients continues to be vexing to many organizations – large and small.  While there can be many reasons for the lack of true adoption, here are four that we at Greene Consulting have seen as the most critical for firms to address if they are going to be successful in generating the adoption and implementation they desire.

Challenge #1:  Integrating Planning into the Advisor’s Practice

A key initial element of planning adoption must be the rationalization of WHY planning is important to the advisor and how they use it to manage client relationships.  While this is a seemingly obvious question, it must be understood that if advisors aren’t fully integrating planning into their practice already, this issue has to be clearly addressed.  Advisors already have a structure for how they manage their day, how they approach their client relationships, and how they deliver value.  If planning isn’t currently a central element of that process, adoption of planning will require change for the advisor in terms of their habits and practices.  Failure to clearly establish the rationale for why planning is so important to the advisor – AND addressing how it should be integrated into their practice – will undoubtedly be a barrier to full adoption.


Challenge #2:  Advisor Time and Efficiency

When engaging prospects in the sale of any wealth management product or service offering, the focus is typically on a specific deliverable and the associated fees for that service.  In the delivery of planning, the advisor is required to spend more time understanding the breadth of the client’s needs, gathering a far more significant amount of financial information, and developing the plan.  All of this can be very time consuming.  Advisors needs clear direction on the sequence of the planning experience to help them be more efficient with the time they must spend engaging, developing and delivering plans to clients.  If they are forced to figure out these processes and related efficiencies on their own, broad adoption will be challenging.


Challenge #3:  A Singular Definition of “Financial Planning”

All too often when we ask advisors to define “planning” and the financial planning process, they describe a process involving multiple meetings, significant time and effort by both the client and the advisor, and ultimately the delivery of copious plan documentation.  While this might be what is required for some clients, planning does NOT always require this amount of effort.  This is especially true in light of the advances in the functionality of the major planning software platforms that provide advisors with a broader range of functionality and the ability to deliver far less onerous – but still meaningful – planning engagements in terms of time and effort.  The key to this is helping advisors translate the functionality into a broader array of planning “experiences” they can deliver to their clients.  Smaller clients with less complex needs can realistically get value-add planning in one meeting IF the advisor has a defined approach for doing so.  Ultimately, driving strong adoption of planning requires firms to clearly define how advisors can deliver the right type of planning engagements to the wide variety of clients that they serve… making it feasible for them to more efficiently engage clients with planning.


Challenge #4:  Translating Planning into Production

Advisors need to have a clear, concrete approach they use to ensure the planning process translates into increased revenue production.  Think about this fact.  When developing a financial plan for a client who is not on track to reach their stated goals, every planning software provides one or more of the following four recommendations:  Save more, delay the goal, lower the goal, or generate a higher rate of return on the assets invested.  The problem for the advisor here is that none of these recommendations, in and of themselves, lead to incremental revenue.  Firms launching or seeking to increase adoption of planning by their advisors must be able to show advisors how to use the planning process to generate increased revenues.


To drive adoption, and the related increases in revenue, advisors need a skillful approach to leverage the planning process and engage clients in what we call the “Asset Consolidation Conversation” so as to derive incremental assets and related revenues that can come from the planning process.  If advisors don’t have a clear path to how planning will drive revenue production, they might initiate a few plans with clients, but when those plans fail to drive production, they will begin to avoid the planning process.


Addressing the Adoption Challenges

While these are just four of the challenges we see facing firms who are seeking to drive the broad scale adoption of financial planning, these seem to be four of the most significant.  In our role with firms who are launching financial planning – or simply seeking to drive greater adoption – we have developed the “Financial Planning Experience Program” which provides a comprehensive infrastructure firms can deploy to integrate effective practice management strategies and leverage the key skills and best practices that top planning advisors use, with specific references to the functionality of two of the leading financial planning software deployed at each firm.  The program also has extensive Coaching Guides and Resources that can be used to ensure sustainability over time.  The result – advisors who are equipped to understand specifically why planning is important, how to most efficiently deliver planning to the different types of clients they work with, and how to leverage the planning process to drive revenue growth in their practice.


For more information on our Financial Planning Experience Program, contact David Greene at 404-324-4600.