Focus is firmly on day-to-day operations

Nowhere is the sense of a successful transition more complete than at the old CMG-Worldsource Financial Services Inc., a Markham, Ont.-based planning company that just a short while ago didn’t even have a Web strategy.

In fact, the company came in dead last on the 2002 Planners’ Report Card, suggesting new president and CEO Dianne Carmichael would face a challenging task of reorganizing the company from top to bottom.

One of her first acts was to commission a massive survey asking planners what they liked and disliked about the company. From that, Carmichael created a strategic plan and began rolling out new initiatives.

“There was a tonne of work,” she says. “We didn’t take one project and work on it; we completely re-engineered the company.”
Eighteen months later, there is a Web site known as WorldPort, an insurance division, a securities arm, in-house research, a new back-office system, a new wrap account and even a new name and logo — WorldSource Wealth Management Inc. — that identifies the new entity as a completely new company. “We didn’t have full wealth management, but that’s what we want to offer so we’ll attract high-end planners. That’s the plan,” says Carmichael. “I don’t think a lot of people know how much we’ve changed since the last report card but it’s been an intense 18 months.”

That’s also true for the entire financial planning industry, which is a much different animal than it was a few years ago. Big consolidators, such as Winnipeg-based Assante Corp., have snapped up many of the smaller players, which sprouted like mushrooms through the bull market.
Assante alone bought and merged some 18 companies over the past decade. Although Gail Granger, Assante’s vice president of corporate communications, says the company is still looking for more acquisitions — “We’re always looking,” she says — there are not as many obvious takeover targets left, suggesting the pace of consolidation should slow.

That’s certainly the case at Cartier Partners, another big consolidator based in London, Ont. Although parent Cartier Capital LP has put its 66% interest in Cartier Partners up for sale, CEO Dan Richards says the firm’s focus is inward; it is concentrating not on more acquisitions but on day-to-day operations.

Between 1999 and 2000 the old BRM Capital Corp. snapped up a total of six investment dealers, insurance and insurance brokerages with the financial backing of the Caisse de dépôt et placement du Québec (whose change in direction has caused Cartier Capital LP to put its share of Cartier Partners on the market).

According to Richards, the period of consolidation is over. “The focus has already shifted and the big push is on operations,” he says. “Our focus now is on running the firm and perfecting our operational efficiency. It’s time to roll up our sleeves and get to work implementing the efficiencies consolidation allows. Making things work — that’s the big challenge now.”

The attitude is similar at WorldSource. There the strategy is to re-engineer during the downturn, when there is less pressure to recruit and bring in assets, and then emerge as a new company when the market turns around. With much of the reorganization completed, Carmichael is turning her attention to recruiting. “I think we’ve built a better mousetrap. We’re at the point at which we’re going to focus on business development. I’m in the process of recruiting business-development people who will be writing the story about what we’re doing and how we’re doing it,” she says.

The new business-development people will launch an advisor recruiting drive, offering incentives to advisors who want to work for WorldSource. “We’ve just launched that. Our new technology will be in place this summer and I’d anticipate we’ll have people coming over in the fall,” Carmichael says.