Invesco and Cerulli Associates have announced the launch of their new Practice Innovation Index, described as a digital analytics tool that benchmarks key traits and characteristics of financial practices.
According to the firms, these traits and characteristics span four benchmarking areas: business development, wealth management, client service and practice management. The benchmarking methodology leverages more than 10 years of Cerulli survey data to analyze where a practice ranks among peers and provide a customized roadmap designed to help them expand their businesses.
The launch of the index comes at a time when the financial adviser industry is undergoing substantial change, in which record-setting merger and acquisition activity and a blurring of the line between financial services industry verticals play a leading part. Advisers say it is a great time to be in the business, but they also cite as challenges evolving regulations and increased competition.
John McDonough, head of U.S. wealth management intermediary distribution at Invesco, says the new service is meant to support advisers as they tackle greater business complexity and evolving client demands. He points to Cerulli survey data that shows advisers most commonly identify new client acquisition (52%), compliance (40%) and managing technology (30%) as their practices’ primary challenges.
The index is based on an assessment of the participating firm. Powered by Cerulli’s data, the Practice Innovation Index’s proprietary methodology scores and benchmarks responses. Each question is scored against the benchmark, and results are shown for each of the four categories and in aggregate, highlighting how the financial practice ranks among peers. Financial professionals are then shown a roadmap designed to leverage their strengths and address opportunities for improvement. For more complex financial practices, advisers can access Invesco’s dedicated coaching to help create actionable plans.
“Advisers today face the challenges of addressing demands from investors, financial markets and regulators, all while striving to scale their businesses,” says Asher Cheses, associate director of U.S. wealth management at Cerulli.
Cheses says the index will provide a quantifiable tool designed to benchmark the attributes of the industry’s leading financial practices, ultimately enabling advisers to help their clients achieve their financial goals.