Anthony Carty, managing director at Clifton Wealth Partnership, looks at how acquisitions can deliver more than continuity for clients, with better technology, stronger support and a more consistent service.
When an adviser firm is acquired, minimal disruption for clients is usually treated as the measure of success. From a client’s perspective, retaining their adviser, continuing to benefit from the same service and nothing feeling too different appears to be a positive outcome from an unknown situation.
While it’s understandable for advisers to want to provide a sense of familiarity for their clients, I’d argue that’s not nearly an ambitious enough desired outcome. Following an acquisition, advisers should be able to offer their clients something better than they had previously. A client who doesn’t notice any change has, in effect, received no real benefit from the process.
Consolidation, when it works properly, should offer clients a better service and an acquirer that claims “nothing will change” is unlikely to be being totally transparent. The regulator expects firms to safeguard good client outcomes following an acquisition. A consolidator that allows a firm to carry on indefinitely with its existing centralised investment proposition and platforms, for example, may struggle to evidence good client outcomes under Consumer Duty, resulting in a patchwork of inconsistent client journeys and governance problems.
Many adviser firm owners know some things should change post-acquisition, andthe practical advantages that come with scale are well understood inside our industry. Reduced operational duplication, stronger governance, more sophisticated technology, assistance with compliance and a higher standard of data security are all benefits that come with the backing of a larger entity. These tend to be framed in isolation as efficiency gains for the acquiring firm, however, they should also be seen as improvements in the service clients receive.
We think about this with every firm we bring into the network. Following an acquisition by Clifton Wealth Partnership (CWP), clients benefit from Connects-X, our proprietary technology platform that connects specialist services and data within a single ecosystem. That means less administration, fewer disconnected systems and a more consistent client experience, while still allowing us to offer best-of-breed solutions where they add value.
Clients also gain access to MyViewPoint, CWP’s client portal and app, which provides secure access to portfolio valuations, documents, messages and investment information in one place.
What about the staff?
Clients aren’t the only ones who should benefit from an acquisition. Advisers and paraplanners at smaller firms often find, on joining a larger network, that the professional landscape shifts quite substantially. Being part of a larger entity often offers new career opportunities for those interested; career structures that didn’t exist at a firm of four people become accessible. Larger firms can often offer staff professional development, specialist technical support, and a peer group that extends well beyond the previous office walls.
Professional opportunity and development are likely to be important to staff – and provide an indirect benefit to end clients. A well-supported adviser, with room to grow and better tools at their disposal, is less likely to leave a firm. In addition, advisers with access to better technology, which can be harder to access at a small firm thanks to its expense, can spend less time on tasks like admin and more time with their clients.
Clients who barely notice their firm has changed hands haven’t had a bad experience. For some – those who were happy with the status quo pre-acquisition – no obvious change can be a good thing. But, in my opinion, a great acquisition would be one that left them with something more: a stronger planning process, access to better technology, and real confidence in the firm behind their adviser.
