Investors need bionic advice, says Jack McVitie, Chief Executive of LEBC Group Ltd.
McVitie founded LEBC Group just over 18 years ago and the firm has now grown to 17 offices advising on assets of GBP4 billion.
Initially the company advised SMEs, both the directors on their pension plans and tax savings, and the employees on their defined contribution pensions. In 2013 the firm had an offsite meeting which threw up the idea that it wanted to transform the access to advice for employers, employees and individuals.
“That became our mantra,” McVitie says. “We are an advice business not product led and we knew there were not enough advisers at the time and that demand would go up with an ageing population.”
So, the solution was something that McVitie christened ‘bionic’ advice. “We didn’t want to go down the robo route because that is not advice – it’s a fulfilment system,” he says. “Once you have made your decision that you want an ISA or a pension, you fulfil it and buy one. That’s not advice in my book.”
The shortage of advisers and the growing demand for advice meant that McVitie felt the existing advisers would need greater reach. “They would need greater reach so we gave them the tools to make them more efficient and gave them the tools to be able to advise more clients within a given time frame.
“We worked on telephony so that a lot more advice could be given by telephone and we also started working on intelligent systems, building advisory systems that made the advice journey easier for the supply chain to deliver.
“We were trying to take out some of the rote activities you need to get involved in and trying to streamline the paraplanning processes so that reports could be compiled more efficiently.”
The McVitie model does not involve the financial adviser going to a client’s home. “It’s not efficient,” he says. “People can make correct important financial decisions on the phone.”
Sessions were run internally to facilitate the changes, named the Night Mail sessions after the black and white documentary film from the 1930s that reported on the delivery of the mail overnight.
“We said, ‘isn’t email more efficient than that?’. We have to find new processes.” He boils the process down to delivering content efficiently to the customer. “Bionics is driven by people needing advice.”
The firm worked with Andy Morrey, a digital expert from the retail industry, inventor of Click & Collect who had worked for Argos and Marks & Spencer.
“We need that for our industry,” McVitie says. “And then we just keep iterating your processes to try and think differently about what we are doing with lots of incremental improvements. Simple stuff like sourcing annuity quotes into reports without having to touch them. You can do more and reach more clients but at the same time lower the costs.”
Early November sees the bionic system, which is currently a closed almost invitation only system, opened up to become a direct to consumer offering.