Unbelievably, I’ve been in the financial services industry for about 30 years now.

I joined Charles Stanley about three years ago and run its central financial services division. That includes the asset management business and the execution-only business Charles Stanley Direct.

We’ve also launched our Foundation Planning service, which is all about bringing the digital, advice and guidance elements together. That’s my latest toy, and it’s really interesting to be a part of.

People will be aware of the deal with Raymond James, and right now we are going through a process of due diligence where we hope the deal will complete in due course, subject to regulatory approval.

This will be the sixth time I’ve been involved with an acquisition like this, so I know a little bit about what to expect. These things aren’t about what happens in the short term, but much more geared around the longer-term impact.

Reflecting on platforms

One of my previous roles was as head of distribution for Macquarie Bank, to build its presence in the wrap platform market in the UK.

Macquarie had tremendous aspirations to come in and be a positive disruptor here.

It had done exceptionally well within the independent space in Australia, and saw itself as being in the same competitive space as Transact and Nucleus, with the aim of bringing some real established smarts from the Australian market.

There were a number of things that worked well. But I think the things that didn't work well were that the business plan probably assumed the UK market would load assets on quicker, and that the pricing wouldn’t be as competitive as it was. There was also perhaps a sense that the Macquarie brand cachet would carry more traction at the outset.

Those three trade winds conspired to make things quite slow.

For vertically integrated firms that do asset management and run a platform, there is that challenge of how much do you continue to spend [on integration]?

To me it seems logical that you build APIs and become part of an ecosystem, rather than trying to own everything. That’s not the road some of the technology firms are taking. Personally, I see the future of advice as front, middle and back offices being perfectly integrated, but through APIs.

Taking it back to Macquarie and maybe where it went wrong, is that it tried to integrate the wrap and Coin, the CRM system, to try and be ahead of its time. Actually it was the architecture of that join that created the fragility in the wrap. The idea was great, but they couldn’t get it through on execution.

What we’re now seeing is that wider issue of integration being addressed through APIs, rather than through building things together.

Making the leap

I’ve worked across the whole gamut of the advice space – in asset management, advice and platforms. The thing that has always struck me is how complicated we make it, both in our language and how we take the customer on the journey.

I’ve got this theory about people who are ‘post-Google, pre-planning’ – those who are interested enough to do some research online, but not at the stage where they want to commit to the planning process.

They might be the under 55s, still with a mortgage to pay off, paying into a workplace pension but not actually engaged in the personal dynamics.

We need to reach out to those people to educate them in a clear and transparent way about some of the things they need to think about. I think that’s about making that leap into planning easier by providing a triage service.

I don’t think guidance is great when you just provide some information, I think you have to provide some answers.

The way I like to look at it is like stepping stones across a pond. What we’re trying to do through our Foundation business is to take clients, largely unadvised, through a process broken down into what we call modules.

One module might be accumulation, another might be decumulation, and another might be a five-step financial health check.

For a flat fee, we want to give people the key insights and answers, and then if they want to go into a full financial planning service we can introduce them to that part of the organisation.

But at the very least we will have debunked some myths that they may have read on the internet, we’ve told them how it is and there’s no sting in the tail.

We’ve been running surveys with clients since April, and the feedback’s been fantastic. People are able to ask the daft questions, to get that human interaction and have the really important conversation around ‘what do I do next?’

Charles Stanley’s history is one of being a stockbroker that’s become a wealth manager, and Charles Stanley Direct has nearly 50,000 clients. So that’s a lot of people you can ‘wake up’ for want of a better expression and turn into advisory relationships. That’s the gold under our feet.

But that’s where we’re starting from. I can see why commercially it makes sense for advice firms that have traditionally advised those with, say, £500,000 to £1.5m to keep advising those clients.

The social media learning curve

I’ve definitely learned more about social media since I’ve been running Charles Stanley Direct than I ever knew before. It’s a totally different window into the world.

We all go on Twitter, and then convince ourselves that because we’re on social media that we understand it. I’m now working with social media experts and agencies and it’s been an extraordinary learning curve, understanding that ability to influence people directly and to create your own brand.

We’ve hired people that aspire to be the Tom McPhails of the future if you like, to try and drive that influencing work. And interestingly, we hired from outwith the industry.

I remember taking part in a panel session at a conference, talking about social media and technology, and I was the only one in a suit and tie amid a sea of skinny jeans.

For us, by getting people outside of the industry to try and drive engagement through social media and content, the hope is that will bring Charles Stanley Direct closer to what I was talking about earlier, and helping people to have those important planning conversations.

One of the smartest phrases I ever heard on this actually was from an industry mentor of mine who is tragically no longer here.

They always used to describe it as a "quiet little conversation". That has always resonated with me. I think if you can create the content that makes people want to have that quiet conversation, then you're really onto something. But it has to be driven by authenticity.

Data and the future

Before I joined Charles Stanley, I did consider buying some businesses myself. I’ve been on the board of big consolidators, and I got a sense as to how I might go about it.

If I were to buy a business today, the first thing I would do is send in the data experts. I would get people in there to ensure all the client records were immediately uploaded onto my CRM.

Normally, that never happens. What tends to happen is people find themselves in a board meeting with a third of the data they need.

All of a sudden, advisers start leaving with their clients in tow, and you don’t actually have the perfect data – you’ve got a name and address, and that’s about it.

Questions are starting to be asked about who the private equity owners of consolidators are going to sell to. I think they're going to sell to the next generation of private equity which has the technology solutions, and can bring the broader market opportunities to bear.

That's why one of the most valuable commodities for firms is not necessarily their assets under management, it's their data.

As we move towards a more digitised future, it’ll be the quality of data that underpins advice firms that is going to drive successful, scalable businesses.

There are systems out there already that can do amazing things for clients, and offer really great experiences, and we can see some of that innovation coming through. They're brilliant, but they have to be used with a full set of data. It’s that whole rubbish in, rubbish out thing.

On the subject of the future and intergenerational planning, research suggests that the next generation of clients won’t deal with their parents’ financial adviser. Our own research sees similar trends.

But from our perspective, it makes sense commercially to try and find a way to change the feel of the brand to appeal to that next generation. That allows our knowledge of the family affairs to stay consistent, but the way we serve and approach that client is different.

We’ve got to try and grab that tiger by the tail. If we don’t, then like every advice firm out there, eventually your client bank dies out and you have to find a way of replenishing it.

It’s a challenge for everyone, but it’s one as a business we’re really enjoying. I would say it’s one of the most interesting propositional challenges and projects I’ve ever been involved with.