Outsourcing helps financial advice firms to focus and grow

Education Future of Financial Advice

Q&A with Simon Dowd, Financial Adviser, Vision Advisory Services

In July 2015, Simon Dowd, an authorised representative under Centrepoint Alliance Financial Advice, scaled back his own financial planning practice, Vision Advisory Services, offering holistic financial advice.  With no staff to provide support, Simon decided to outsource para planning and other back office functions to an overseas service provider. This enabled him up to focus on his clients and win new business.

After trialling several outsourcing services, Simon settled on JC Consulting Asia until November 2016, after which a full-time in house para planner was employed when the business started to grow. Simon says that once his para planner is fully trained and becomes an adviser, he intends to outsource again.

Simon, how was your first experience outsourcing overseas?

 I initially tried a number of companies, however I found they weren’t fit for purpose, particularly if they were insurance-centric.  I was spending far too much time having to train their staff and redo work so it wasn’t cost-effective or efficient.

How did you find out about JCC Asia Services, one of a number of virtual service providers that Centrepoint is offering to its adviser network? 

Jason Cutrupi from JC Consulting Asia presented at Centrepoint Alliance’s annual conference in Dubai. He is an Australian financial adviser who has set up his financial planning back office overseas, and is providing the same back office functions he uses for his own business to Centrepoint’s network of advisers. The para planners and back office employees have a sound knowledge of insurance and investment products, know the legislation and how things work, and, importantly, understand the financial planning marketplace in Australia. 

The Statements of Advice (SOA) they produce are superior to that produced by many locally-based para planners. The main benefit of locally-produced SOAs has been the ability to communicate with the para planner in real time.  There are no communication barriers with JCC, and their understanding of the request or task negated the need for communications on most occasions.  When I did need to speak to them, I did so via skype.  Employees also work late to stay in touch with our time.

JC Consulting Asia has sufficient resources to handle the work coming in, and can do as much or as little as you want.  However, it might be more cost efficient for the adviser to utilise their Virtual Administrator arrangement and customise a package of ongoing services.

The majority of tasks didn’t require much explanation, but when it was needed, JCC as a team were quick to adapt and implement my requests.  JCC restored my faith in outsourcing.

Why did you choose to outsource?

My time is better spent focusing on clients rather than doing administrative work. There is certainly significant savings in time and money outsourcing para planning and other back office functions overseas.  I didn’t simply want to replicate the work I was doing at a cheaper cost. I wanted to take advantage of the fact that it was cheaper to outsource overseas so I could double my output and, at the same time, offer my clients a better experience and a higher level of service.  This is possible because for every one local person, you can afford near four people overseas.

I don’t see it is worthwhile to hire local people to do everything that can be done offshore via internet.  It’s just cheaper to use overseas services. And as more and more institutions don’t require ink signatures on their administration forms, there is no reason it needs to be done here.

Would you recommend to other advisers outsourcing to overseas service providers? 

In general, yes.  There is a lot that can be done by other people, both here and overseas.  Outsourcing is done for efficiency and cost savings and to increase your capacity as an adviser to see clients.  Clients don’t know if your back office is here or overseas. They don’t walk into your office asking to see your back office staff.  Advisers are looking for a quality, efficient service at a cheaper price, and this can be found overseas. Efficiency comes down to how well trained they are.

Are you able to quantify the benefit you have realised as a result of outsourcing?

In FY 2015 I was working on my own, and outsourcing my entire back office overseas at a savings of $91,500 for one year.  I was replacing one person locally with a small team overseas.  I would recommend outsourcing some things but not everything.  What I did find was that my clients missed having someone to speak to in my office. While outsourcing is all well and good, and all the work is being done, if I am out seeing clients there is no one in the office to answer the phone.

Q&A with Jeff Everett, Manager Advice Development, Centrepoint Alliance

Has Centrepoint taken adequate steps to ensure the virtual service providers they offer maintain high standards in both quality work and service?

Centrepoint has conducted comprehensive due diligence on a range of virtual service providers and has been trialling them with advisers for the past six months.  In terms of the full range of virtual service solutions being offered, all the hard work in terms of due diligence has now been done, and the service has been made available this month to all advisers in the network.

Do you believe that the range of support solutions being offered by Centrepoint will make it easier, more economical and more efficient for advisers to do business? 

Yes I do.  You can outsource your Statements of Advice, para planning, para lending and back office functions and be confident in the knowledge that it will be completed well, on time and for a lot less than what you would pay a dedicated on-premises staff member.


Find out more about our Virtual Services