Dealers’ messages not getting to advisors

There is clearly a disconnect between the message management is delivering and what advisors are hearing. What is not clear is whether management isn’t communicating the services adequately or whether advisors, if they haven’t had a reason to use those services, haven’t noticed they are there.

The message was particularly blurred when it came to advisors rating the support for insurance, support for tax planning, and support for wills and estate planning. There was a total of four N/Cs in these categories. Yet advisors rated the importance for all three support services higher this year than last. With Canada’s aging population, more people are looking to their advisors for advice in these areas — and advisors are looking to their dealers for support.

Ottawa-based Independent Planning Group Inc. was one firm that garnered an N/C. Although IPG offers support for wills and estate planning, both through advi-sor training programs and consultants trained to deal with difficult cases, many advisors were reluctant to grade the service because they weren’t aware that it was offered.

Of the IPG advisors who were surveyed for the Report Card, only two rated the firm’s support for wills and estate planning. Vince Valenti, the firm’s president, says this disconnect probably occurred because the support isn’t provided in the traditional manner — that is, through lawyers and accountants. “[IPG’s advanced case consultants] are on staff for technical cases,” he says, “[such as] situations in which a client may have many holding companies, and there are various technical issues. The advi-sor needs someone to understand those issues.”

Advisors sometimes run into self-employed clients who own one or several operating or holding companies and require more complex planning. “A proper financial planner has to make sure he or she takes into account the ownership of companies and any potential, future tax liabilities that may arise,” Valenti adds. “That’s why advanced case consultants are experts on dealing with those complex situations.”

And Valenti stresses that advi-sors are aware that these advanced case consultants are on staff. “Advisors certainly do know about these available services,” he says. “We communicate with them on a regular basis. It’s just that they may have interpreted ‘support’ as an accountant or a lawyer.”

Still, an IPG advisor in Ontario claims ignorance: “Maybe they offer the service, but they have not made us aware of it and have not put enough emphasis on it.”

Another IPG advisor in Ontario likewise was unaware of the consultants. “I don’t have clients who own holding companies,” he adds. “Maybe I’ll have them 10 years from now.”

An N/C rating also popped up at Saskatoon-based Sentinel Life Management Corp. when advi-sors were asked to rate their firm’s succession program. But Merlin Chouinard, Sentinel’s president and chief compliance officer, is unfazed. He says advisors didn’t rate succession planning because the program is only for advisors who are about to retire — and that those who are not in that process are unfamiliar with how the program works.

Sentinel has taken part in just six succession plans over the past three years. “If you talked to one of those advisors,” Chouinard says, “and zeroed in on that particular area, you would have gotten very complimentary and flattering comments.”

Another example of a disconnect between a service that a dealer provides but which advisors didn’t rate occurred with Mississauga, Ont.-based Investment Planning Counsel‘s consumer advertising.

Only four IPC advisors surveyed graded the category. IPC president Chris Reynolds puts that down to the fact that IPC does very limited advertising. And what it does is still in its infancy.

“The only media that IPC engages in is with a very directed campaign through the Canadian Association for Retired Persons,” says Reynolds. “It is a pretty popular program but only affects about 100 of our advisors who are CARP-certified and receive leads through the program.”

@page_break@The firm’s primary branding focus is at the local level through its advisors, he adds.

But as IPC advisors say that consumer advertising ranks an 8.0 in importance, the firm will expand its consumer advertising in the future. “It is part of our plan for 2009,” Reynolds says.

Toronto-based Assante Corp. also saw N/Cs turn up for “IPOs and new issues” and the “quality of equity research” categories. But that is easily explained, says Bob Dorrell, the firm’s senior vice president of business development. Advisors didn’t rate these two categories because only a small number of advisors rely on them.

“I can probably count the number of advisors on my hand that need access to new issues in any big way,” he says. “Our firm is a 99% financial planning firm. So, there is not much interest in IPOs and new issues.”

Although equity research is available through National Bank Financial Ltd. and sister firm Blackmont Capital Inc., a Toronto-based investment dealer, very few advisors make stocks part of their business model. “They may have some stocks to complement their portfolio,” Dorrell adds. “Typically, they would be blue-chips that don’t require a lot of research.”

In addition to the N/Cs, there were also occasional gaps between advisors and their managers when it came to services that the dealers don’t offer but which advisors say are increasingly important to them and their businesses.

For instance, Regina-based Partners in Planning Financial Services Ltd. does not have a fixed-income desk, but its advisors say availability and pricing of fixed-income products are important when servicing their clients. IE