The DOL had their say. Now what?

Business strategy compass The release of the Department of Labor’s much-anticipated new “fiduciary” rule yesterday stole many headlines – most of which focused on the resulting challenges facing much of the advisory industry. While we agree that the rule has the potential to affect all aspects of advisors’ business operations, we actually see the rule as an opportunity for advisors to embrace many advisory best practices and ultimately, build sustainable advisory businesses. Over the past year, we have reported on what we consider are some important steps advisors can take in light of not only the DOL rule, but also some of the other major forces influencing the advisory landscape these days – such as aging clients, the rise of millennials and technology shifts. Specifically, we believe that advisors who focus on the following four pillars have the potential to successfully navigate the changing advisory landscape.

Four pillars of a sustainable advisory business

  1. Manageable number of client households
  2. Product inventory control
  3. Documentation and implementation of key processes
  4. Optimized client experiences, including client portfolios
In the following weeks, we will address each of these four pillars in turn, offering ideas for how to strengthen them in your own business.

The bottom line

There’s no doubt that advisors are facing a number of competitive pressures. Retiring boomers, millennials coming into their own, technological innovations and now the new DOL rule are all changing the landscape for advisors. But we believe that those advisors who are willing to rethink how to remain competitive and relevant and manage the four pillars of a sustainable advisory business within their own practice have the potential to benefit from the shifts.
Russell Investments is a trade name and registered trademark of Frank Russell Company, a Washington USA corporation, which operates through subsidiaries worldwide, including Russell Financial Services, Inc., member FINRA. Russell Investments’ ownership is composed of a majority stake held by funds managed by TA Associates with minority stakes held by funds managed by Reverence Capital Partners and Russell Investments’ management. Copyright © Russell Investments 2016. All rights reserved. This material is proprietary and may not be reproduced, transferred, or distributed in any form without prior written permission from Russell Investments. It is delivered on an “as is” basis without warranty. RFS 17096
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