Relationship trouble

Our client had been with their full services provider for over 15 years and enjoyed, on the whole, a good relationship. However, more recently some strains had started to appear and frustrations were building. The Trustee began to feel that they were not hearing the best thinking on investments and funding. They were concerned that fees were no longer competitive and that they were not an important client.

The problem our client faced was in knowing how to address these issues and what was available in the market after 15 years of development and change. That is why we were appointed: to bring the Trustee up to speed with the latest offerings and find a provider that would bring fresh views and work well with the trustee.

Broadening horizons

We facilitated a discussion on the service requirements, which helped the Trustee identify specific issues and focus on how they liked to work with their adviser, and how the relationship should work. We were able to challenge the existing ways of working and help them start afresh.

We then managed the selection process. We approached a broad range of firms to ensure the client saw the full spectrum of offerings in the market and options for their future relationship.

For us, selecting a new adviser is about the relationships between client and provider. Our role is to ensure that there are opportunities to build relationships, see what the provider would be like to work with and ensure that the Trustee are satisfied that a provider can meet their requirements. To do this, we held a series of calls with candidates and issued an RfP, we facilitated a decision based on that initial contact with providers and progressed on to presentations.

Presentation is a bit of a misnomer. It is important that the client and any potential provider work well together and have a similar culture. Therefore, our approach was to run a mock trustee meeting. We set a scenario agenda that covered the full range of services, allowing candidates to approach as they would at a real meeting.

It was interesting for the Trustees to see the range of approaches that were taken and to hear some, essentially, free advice! It gave a good feel for what the relationship would be like and how well the two parties would gel in practice.

A Brighter Future

The Trustees were surprised by what they saw: electronic governance software, asset-liability modellers and transactional member websites! The Trustees were not receiving any of these and had some eye-opening discussions with the providers on funding, investment and integrated risk management approaches.

The Trustee found themselves in a bit of a bind: two strong candidates and a split vote for the preferred candidate! From our point of view, this was fantastic news. It was great to know that we had found two providers that were such a good match as to make the decision impossible.

However, a decision was reached and a new provider was appointed.

Key learnings

• It is important to regularly take stock of your relationship with advisers and ensure that you are seeing the best of what they can offer. This is particularly necessary where you are receiving full services, so do not have any readily available points of comparison.
• The market is competitive, but the tools and technology are similar with advantages and disadvantages to each provider’s offering. The focus of a market review should be on relationships and working together, and not give undue weight to the flashy tools that providers might choose to emphasise.
• Having a clear set of requirements and an idea of your preferred ways of working can help inform the shortlist and the criteria by which a decision can ultimately be made.