On Day 2 of Cafemutual Ideas Fest 2021 (CIF21), Moh Hon Meng, Co-founder, iFast Group advised how to create a business plan to future proof your practice. Drawing lessons from other global markets he explained the GIST of what he thinks that the future holds. By GIST, Moh Hon Meng meant
G - Global Investments : I - Independence from products : S - Specialize : T - Team
- Global Investments – Most people are generally comfortable in investing in their home markets. Such investors tend to miss on the opportunities that global investing offer. For example, a comparison in terms of the index numbers shows that S&P 500 outperformed Sensex in the last 10 years. Further, the INR depreciated about 40% against the US dollar in the said period. The figures get dramatic as compounding comes into effect. For instance, the 10-year CAGR in INR terms as on 31 Jan 21 is 16.6% for S&P 500 as against 9.7% for Sensex. Investing globally can make long term investing work, as it is very hard to say if investing in only one market will prove to be worthwhile or not. Advisors must urge their clients to invest globally.
- Independence from products - Regulations strive at protecting investor interest and are a driver to creating independence from products. Advisors must pursue this independence and work completely in the interest of clients. They must shift the focus to the client, understand their needs and thereafter recommend the right product category. The product offering must align with clients’ requirements. Clients want to have a conversation with their advisors. They read online about the products and desire to add them to their portfolio. Other professionals who are clients to advisors may be an expert in their domain. For example, a client having a good understanding of the semiconductor industry will be more a subject matter expert than an advisor who is an expert in general. Advisors must be ready for meaningful conversations with such professionals. Sophisticated clients thus drive independence from products
- Specialize - Advisors must focus on their clients and be client-centric. Specialize in this area and not get too distracted with software or platform creation. Using available platforms that offer technology, and support administration, products and payments give operational ease such that advisors can direct their attention and efforts towards serving clients.
- Team - Having a team helps in catering to clients from different backgrounds. For example, some women clients prefer women advisors. Working in a team of advisors also helps in pooling together the diverse expertise of many that help to specialize in more than one domain. It may be ideal to have a team of 5/10/15 advisors that can greatly increase the scale of handling clients. Working in a team also increases the ability to hire staff for functions like administration, research and marketing which allows you to spend more time with the clients.
The perspectives shared by Moh Hon Meng helped many gain clarity and develop a positive vision. You can click here and watch this captivating session online.
