Building A "World Class" Consumer Financial Services Business Using Personal Financial Planning Capacity As A Strategic Asset

In order to be "world class", a financial planning firm should think about more things besides sales. It should position staff and service benchmarks and asks itself whether it needs a large number of sales staff. It should be mindful that quality outweighs quantity. It must decide how it wants to make money as industry pioneers in Singapore. There is absolutely little/no value to the business if the firm does not think or act like a professional.

Some of the inherent problems in the industry:
(1) There is no IFA (independent Financial Advisor) industry in Singapore.
(2) Banks still account for 90% of the financial products sold (i.e. consumers still buy from bank).
(3) Insurance companies still place a greater emphasis on in-house sales because they believe it will help them sell more.
The firm must be able to come up with solutions to overcome all these problems in order to achieve a competitive edge and become a �world class� financial institution.

The key to gaining a competitive advantage is to understand the new consumer and know what they want and need. The industry must move from being product centric to being customer focused because only by shifting to a customer centric approach can the distributor and the financial product manufacturer meet the needs of the consumer and win the business. Across the Asian region there is a discernible trend towards a new customer profile. As the market and consumer shift towards a more sophisticated stand, the distributors� role must move from product sales to financial advice.

In the new Asian financial service landscape, a company's brand image must encapsulate those things that are critical to the customer's purchasing decisions such as security, stability and value for money. By building a strong brand, it will elevate a product from commodity status to something of value.

Good strategy and research is also important in the financial service landscape and is essential to the successful distributor. Sourcing current information and developing sound investment strategies in the financial service industry is a time consuming task and is almost impossible for a distributor to research effectively. A high quality manufacturer therefore needs to provide assistance to the distributors in this area.

In the new financial service landscape in Asia, the products for consumer must fit their needs and level of sophistication of the market. A high quality product will attract high calibre distributors. In conclusion, the insurance industry will change dramatically over the coming years. It will have dramatic implications for agents and distributors. Those who want to succeed will need to align themselves with first class manufacturers and possibly manufacturers who have worked out the right tools and services to support a new breed of distributors. No single initiative will provide a competitive advantage for distributors and product manufacturers in the new financial service landscape. However, focus areas such as innovation, service and support, brand and financial security will provide an edge for those who want to survive in the new environment.