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Forward Thinking Magazine : December 2010
Written by Richard Gibbs, Global Head of Economics, Macquarie Group In an advisory practice it is crucial that the service delivery model supports the business’ value proposition. Consider all options before changing your firm’s service delivery model growth strategies Written by Alexandra Cain, journalist Today, there are a number of different service delivery options – including wrap platforms, managed discretionary accounts (MDAs), separately managed accounts (SMAs) and individually managed accounts (IMAs) – available to planners and their clients and it is essential to reflect on which option or options best support your business so that your practice is operating to its optimum potential and so that your clients receive cost-effective, relevant advice. It’s important to remember there is no one-size-fits- all solution. It’s about ensuring that the costs and benefits associated with the solution you choose are fully understood before you decide to go down a particular path. In addition, the different service delivery models are also not necessarily mutually exclusive. For some practices, it’s appropriate to operate a number of different platforms to support the service delivery model, but for other practices a single solution is suitable. In this article, we explore the different service delivery models and their pros and cons for different value propositions. “At the end of the day the service delivery model or models you choose need to support the relationship you have with your clients,” says Liz McCarthy, Head of Macquarie Practice Consulting. “Our experience shows that the quality of the relationship an adviser has with his or her clients leads the business’ value proposition. Our modelling demonstrates that the relationship is 70 per cent of the value proposition, with the quality of investments comprising 20 per cent of the value proposition and the remaining 10 per cent is around price.” 11