Schwab recently released their latest Independent Advisor Outlook Study (IAOS), and as ThinkAdvisor points out, the report contains both good news and a warning for advisors.
The good is that RIAs report growth in new clients, compensation and wallet share since the onset of the bull market. 93% of 629 RIAs surveyed believe our industry is on a “continued growth trajectory,” while 53% stated that the industry will continue to grow at a faster rate than the market. According to ThinkAdvisor, “Respondents reported high employee retention rates, hiring plans and technology investments to maintain their growth, with their top talent acquisition priority being adding staff in operational and support roles.”
Bernie Clark, the head of Schwab Advisor Services, believes that these findings indicate a shift from RIAs “being entrepreneurs with practices” to “enterprises.” Clark went on to say that RIAs are “trying to make sure they’re scaling” these enterprises to make them “be more efficient exponentially.” However, in spite of all the good news, Clark warns advisors to beware of complacency. In his view, RIAs can either “evolve or die.” Key for a successful evolution is participating in “the next wave of technology.”
Clark further points out that the big wirehouses no longer have the allure they once did. Advisors can choose now whether they want to remain tied to the older traditional model of doing things, or break away and become the “new next model.” Says Clark, in the near future “even Uber will look like an old model.” New technology ushering in the new generation of advisors includes automated investment technologies (read robo-advisors) like Schwab’s Institutional Intelligent Portfolios which was released earlier this week.
Adhesion has been ahead of the curve with a personalized UMA platform that is scaleable and bolsters the advisor’s control over their unique value proposition. It allows advisors to segment their businesses and deliver customized investments and services to different segments. Helping advisors dynamically evolve into a new model of RIA firm is what Adhesion has been about all along.
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