According to Martin, at the forefront of meeting the increasing digital expectations of clients is creating a digital first business that meets clients’ needs. Such a business comprises of three key components:

1. It adds more value and exceeds client expectations — Digitisation has increased the focus and expectation on access to timely information, and the lowering of transaction costs for goods and services.
2. It prioritises digital outcomes — The banking sector has set an example, by capitalising on the use of data and AI to not only improve efficiencies but also provide an enhanced client engagement model to its clients.
3. It has a business wide culture — Being digital first is a mindset across the whole business, and is not about being an actual technology business.

Martin adds there are five core principles that underpin a digital first business, which advisers should work towards. They are:

1. Business vision — Create a clear, documented business vision, that articulates who your client is and the problems you’re solving for them.

2. Team development — Motivate your team by cultivating and encouraging knowledge growth, celebrate learning and success, and turn failures into learning.

3. Be curious about data — Understand your business’s data points and implications, and use it to deliver better outcomes. Research, review and refine using data, like client surveys.

4. Staff engagement — Build an open and non-hierarchal business model that facilitates and encourages new ideas and ways of delivering your client outcomes

5. Client first — The cornerstone of your business is your client. Start with the client and it will always benefit your business. However, start with your business and it may not benefit the client.

“The benefits of using technology to create a digital first business are many,” says Martin. “A digital first business will typically have enhanced staff engagement. Microsoft has found that companies with highly engaged employees outperform their competitors by 147 per cent.

There is also a benefit in increased efficiency and productivity. Research from Forbes has found that digital first companies are 64 per cent more likely to achieve their business goals than their peers.”

Another benefit is optimisation of resources. According to global management consultancy, McKinsey & Company, redefining individuals’ roles and responsibilities so they align with a transformation’s goals, leads to a 50 per cent increase in successful transformation.

McKinsey also noted that an additional benefit of creating a digital first business is enhanced client engagement, where it found 70 per cent of buying experiences are based on how the customer feels they are being treated.

According to Martin, the statistics behind making client loyalty an advice business’s number one goal are compelling with:

• 90 per cent of customers spending more with companies that personalise the customer service they offer them;
• 74 per cent of customers saying they will forgive a company for its mistake after receiving excellent service;
• 76 per cent of customers saying they would switch to a company’s competitor due to multiple bad customer service experiences; and
• 64 per cent of business leaders revealing that customer service has a positive impact on their company’s growth through referrals and improved brand reputation.

Drawing on analysis from the Business Health Future Ready IX (2022) report, advice practices that engaged in managed accounts for more than three years and had more than 75 per cent of their clients in managed accounts, had over 85 per cent more profit than those practices that didn’t.

“Managed accounts are an efficient way to run an investment portfolio. Businesses that use managed accounts typically embrace technology and also engage with platforms to provide better client engagement and reporting. They work towards better business and client outcomes,” says Martin. “Often, the businesses that have succeeded the most are those that are both digital and client first focused.”

Martin adds that when connecting your business goals (like digital) with your client’s expectations, the simple task of seeking client feedback and proactively acting on that feedback, can generate an increase of up to 90 per cent in an advice firm’s profitability. And getting the client value proposition correct and ensuring that it is fully documented and not just in the principal’s head, can see a 107 per cent lift in profit.

In addition, the Business Health research shows that when a business seeks staff feedback, and uses someone external to the business to gather that feedback, there is an increase in profit by 250 per cent.