1. What Is Our Post-DOL Value Proposition?
Daniel Ciavarella – Vice President, Wealth Management Marketing
Richard Whitworth – Managing Director, Business Consulting

2. An Industry in Disruption…
We currently face three major headwinds:
Regulatory Pressures
Changing Investor Demographics & Expectations
Accelerating Technology Innovation with Increasing Complexity

3. DOL Grief… Shock & Disbelief Denial Anger Bargaining Guilt Depression
Acceptance & Hope

4. What Value do we Deliver
Financial services doesn’t have the same resonance with clients/public as other industries… what can we do to move up the value chain????? How are your advisors positioned to understand client’s value drivers and how our services/solutions can help?
How do we move towards “self-transcendence // hope // self-actualization?”

5. A Changing American Family
Challenges
Modern Family vs. Traditional Family
FinSvcs Hasn’t Caught Up to Family Changes
Blended Families Increasing
Same Sex Couples
Multigenerational Households
Older 1st Time Parents
Source: UBS: Beyond the Picket Fence – Financial Challenges of the Modern American Family, 2015.

6. Advisor and Client Demographics
Financial life management… expense management… personal CFO
Source: Cerulli Advisor Edge – Bank Advisor - 1Q16.

7. Does your Value Proposition Resonate?
Source: Cerulli Advisor Edge – Bank Advisor - 1Q16.

8. What Clients Will Pay For What Advisors Would Sell
Misaligned Expectations Abound
What Clients Will Pay For
What Advisors Would Sell
Confidence
Investment Management &
Asset Allocation
Reduced Complexity
A Financial Plan
Informed Choices
Budgets
Bespoke Solutions
Insurance
Peace of Mind
Estate Plan
Source: Cannon Financial Institute: Financial Advisors – Relevance Today & Tomorrow – Paper #1, 2016.

9. Welcome to the Re-Wired Investor
Implications:
Bespoke
Multi-channel
Multiple advice sources
Rich digital front end
Risk management as hedge
Democratization of investments
Source: Deloitte – 10 Disruptive Trends in Wealth Management, 2015.

10. Advisors Have to Change…
DOL/FIDUCIARY
Alpha generation
TECHNOLOGY
INVESTOR PREFERENCES
Manager selection
Asset allocation
Tax optimization
Behavior management
Implications:
Bespoke
Multi-channel
Multiple advice sources
Rich digital front end
Risk management as hedge
Democratization of investments
Financial planning
Source: Fidelity, 2015.

11. THE progression OF A FINANCIAL ADVISORY FIRM
…And so do their Practices
THE progression OF A FINANCIAL ADVISORY FIRM
PRACTICE
ADVISOR IS PRACTICE
BUSINESS
ADVISOR IS LEADER / RAINMAKER
ENTERPRISE
STRATEGICALLY LED & PROFESSIONALY MANAGED
121
CLIENTS
$46M
AUM
$139K
INCOME*
AUM
121
CLIENTS
$46M
AUM
$139K
INCOME*
121
CLIENTS
$46M
AUM
$139K
INCOME*
*Pretax income per owner
PEOPLE
Source: Cerulli Special Quantitative Update: Registered Investment Advisor Market, 2011.

12. WEALTH MANAGEMENT FOCUS WEALTH MANAGEMENT FOCUS
In a Commoditized World — What Defines Value?
WEALTH MANAGEMENT FOCUS
WEALTH MANAGEMENT FOCUS
Profit Margins & Avg Client Revenue/Svc Model  what gonna do now that everything commoditized? How shift value proposition? What comes next????
Source: 2009 Moss Adams/ InvestmentNews Compensation and Staffing Study

13. Critical Value to Consider
Collapsing Value Promise
Technician to Clinician
New Market Segments
Disruptive Technologies
Tenured Advisor Engagement
Client IS the Family
Source: Cannon Financial Institute – Financial Advisors: Relevance Today & Tomorrow Paper #1, 2016

14. Key to Advisor Productivity
Maximizes use of technology
Productivity
Outsources & systematizes investment management
Fee-based & recurring revenue-based economic model
Segments clients strategically
Works in teams
Planning-centric
Source: Fidelity, 2015.

15. What we are Hearing from our Advisors
Source: Cetera Financial Group Business Consulting, Sept 2016.

16. DOL Practice Management Essentials
Service Model and
Fee Schedule
CRM and Workflows
Client Segmentation
Advisor Teaming
Staffing Model

17. Post DOL - Ahead of What’s Next
Good news for banks/bank advisors  Bank Trust & Private Banks not perceived as major threat
Bad news for banks/bank advisors  gotta staff better // increase your acumen & expertise
Source: Cerulli Advisor Edge 2016.

18. And the Result? Plan for More Planning
Source: Cerulli Advisor Edge 2016.

19. Success is Balancing Scale and Customization
Source: Cannon Financial Institute – Financial Advisors: Relevance Today & Tomorrow Paper #1, 2016

20. Thank You & Questions