A promise made; a debt unpaid

Financial advisors surveyed for this year’s Dealers’ Report Card said that having their firms keep the promises they make is very important, but their firms need to work on both keeping their promises and delivering on them in a timely fashion.

In particular, advisors gave the “firm’s delivery on promises” category an overall average importance rating of 9.2, tied for fourth-highest in importance behind “freedom to make objective product choices,” “firm’s ethics” and “firm’s stability,” which are the most important categories to advisors year after year. But the fact this category also has the third-largest “satisfaction gap” – the difference between the overall average performance rating that advisors bestowed on their firms for the category (8.3) and the importance rating advisors gave the category – indicates that advisors would like to see some improvements.

One firm whose advisors would like to see a change for the better is Burlington, Ont.-based Manulife Securities, which saw its rating in the category drop to 8.0 from 8.9 in 2012. In 2007, parent company Manulife Financial Corp. acquired Berkshire-TWC Financial Group Inc., and some Berkshire advisors who made the move to Manulife are still waiting for that firm to deliver on specific promises.

“They didn’t deliver on what they said when they bought Berkshire,” says a Manulife advisor in Atlantic Canada. “There was a deal for top producers – we were supposed to have options and incentives – but Manulife didn’t follow through.”

But it’s not only former Berkshire advisors who believe Manulife has issues with delivering on its commitments. Says a Manulife advisor in Ontario: “Promises change every year. They don’t make long-term promises, and no one believes what they say.”

Some advisors at another firm that underwent an acquisition also were dissatisfied with their dealer’s inability to delivery on promises. Richmond Hill, Ont.-based Global Maxfin Investments Inc., which acquired Calgary-based Professional Investment Services (Canada) Inc. in late 2009, had both the lowest rating in the category, at 6.9, and the largest satisfaction gap – 2.2 points – as advisors rated the category at 9.1 in importance.

Says a Global Maxfin advisor in Alberta: “They promised to have better technology and back office. They [did change it. But they promised the transition] would be seamless – and it wasn’t.”

A colleague in Quebec expressed similar concerns: “[They’ve] fallen short on some issues that keep coming up, [such as] back office and software. They keep trying, but they are not there yet.”

Although firms have made different promises, one thing that surveyed advisors share is that they would like their dealers to deliver on promises within the time frame they say they will.

“Everything takes a bit longer than expected upon delivery,” says an advisor in Ontario with Lévis, Que.-based Desjardins Financial Security Independent Network. “Some areas in which they were late are software and analyzing client portfolios, which took two and a half years to deliver.”

Nancy Schafer, Desjardins’ regional vice president, distribution, for Western Canada, acknowledges that keeping within promised timelines can be difficult when rolling out initiatives such as technology. In fact, delays usually occur when errors are found in the testing stage, she says: “Do we take it on the chin and are sad we have delays? Yes. But we’re not sad we are making a good decision not to impact the client negatively.”

Advisors with Toronto-based Assante Wealth Management (Canada) Ltd. said they have been waiting for years to have promised technology implemented. But some advisors said this situation is an exception, as the firm has followed through with its promises to have a strong product offering and extensive support in wealth management. As a result, the firm saw its rating in the category rise to 8.1 from 7.5 year-over-year.

“They’ve delivered unbelievable tools and resources,” says an Assante advisor in British Columbia. “The only promise they’ve failed to keep is updating our technology. But that’s not due to a lack of effort.”

Steve Donald, Assante’s president and CEO, says his firm is still working hard on this promise: “It’s been a strategy that’s been ongoing for a number of years that has proven to be difficult. But we’ve made great strides in the past six months. We’re actually looking to launch a unified client-relationship module on the desktop within the next quarter.”