The Australian financial advice industry has been through radical changes over the last 30 years and Jim Stackpool, founder of specialist consultancy firm, Certainty Advice Group, has seen it all. But Stackpool argues that while some things change, others remain constant in enduring lessons for financial advisory businesses on both sides of the Tasman…
I’ve had the privilege of working with New Zealand advisory teams over the years, and what always strikes me is how familiar their challenges feel. Different regulatory landscape, different market structure, but the same human dynamics at the core of every firm.
So rather than pretend I know the intricacies of the NZ market, let me share what’s happening inside the good Australian advice firms right now, three things that are changing fast, and three things that stubbornly refuse to change at all. I suspect you’ll recognise more than a few.
Three things changing fast
- AI is arriving, but not how you’d expect
Every Australian advice firm I advise is implementing AI.
The promise is strong: better back-office processing, streamlining ridiculous compliance requirements, and better tech stacks. And some firms seem to be getting efficiency gains.
But here’s what I’m also seeing.
The firms rushing hardest into AI are often the ones least clear on what makes them valuable to clients in the first place. They’re pushing their systems for greater efficiency without first questioning their effectiveness.
AI can absolutely help a firm do more work better. But when AI efforts are focused on clients who are underpaying or team members who are underperforming, the bigger question is leadership before new AI approaches.
The firms getting AI right are the ones who’ve already defined their value, their roles and their ideal clients.
For too many, AI is the latest ‘bright shiny’ systemisation project that will land atop last year’s project, and the years before, all designed to prop up a business model that stopped being effective back in 2013.
- Finding good people has never been harder
It has never been harder to find new advice talent in Australia.
Educational and compliance regulations have removed more advisers over the last few years than any similar period in my 32 years of advising.
Talented people want more flexibility, more meaning, and more money — often for fewer hours. That’s not a criticism; it’s simply the reality that principals are having great difficulty navigating.
While offshoring back-office support is growing and provides some options, there is even a deeper issue.
As the investment needed to secure and retain local talent grows, the new roles are not being made into positions to maximise their productivity, i.e. working directly with clients, but rather into positions to accommodate their competency.
Australian team members are getting too expensive to perform traditional back-office tasks. They have to step up and perform more front-office functions. The firms cracking this are the ones that have stopped trying to clone the founder. Instead, they’re building team structures that let newer team members contribute value to clients without needing 20 years of technical expertise first.
That requires a different way of thinking about what clients actually value.
- Demand is surging, but supply is shrinking
Australia has lost thousands of financial advisers over the past decade. Educational requirements tightened. Regulatory compliance costs escalated. Many experienced advisers simply decided it wasn’t worth it and took the 2.5x revenue multiples while they could.
Meanwhile, more Australians than ever are seeking advice.
The demand-supply gap is widening. You’d think this would be universally good news for surviving firms. And it is — if they have the capacity and model to absorb it. For firms that depend on a founder to oversee, manage, attract, and run a business, more demand just means more hours on a harder, longer treadmill.
Three things that haven’t changed
- Advice teams will always be busy
I’ve never met an advice firm principal who wasn’t busy. Not once in 32 years. The nature of the busyness shifts, from client work to staff management to compliance to technology, but the busyness itself is permanent.
Which means waiting for things to slow down before addressing a firm’s deeper challenges is a strategy that never arrives. The firms that truly evolve are the ones that accept busyness as permanent and make structural changes anyway.
- The greatest challenges will always be internal growth problems
The greatest competition for every advice firm I advise is internal.
It’s tempting to blame external forces — regulators, markets, technology shifts, and difficult clients. But the problems that genuinely keep principals up at night are almost always internal. Capacity that can’t keep pace with demand. Revenue is growing while profitability isn’t. The founder is still the bottleneck for every significant decision.
These aren’t problems that better systems alone will solve. They are business-model, personality, and paradigm problems. And they require courage from principals to confront the fact that what has made them successful to date may be different from what will make them successful in the future.
- You will always be refining who you serve
Every advice firm I advise is perpetually adjusting its proposition and ideal client. That’s not a sign of confusion, it’s a sign of a firm that’s growing and relearning what it does best.
The mistake is treating this as a problem to solve rather than a process to manage. If your best client today is still your best client in five years’ time, you are going backwards. The best practices embrace this evolution rather than resist it.
The common thread
Whether you’re in Auckland or Adelaide, the fundamentals of building an enduring advice practice are the same. The firms that thrive aren’t necessarily the ones with the best technology, the lightest regulation, or the most favourable market conditions. They’re the ones who are clearest on what they’re worth and have built teams capable of delivering that value without everything depending on one person.
If any of this resonates, I’d welcome the conversation. You can find me on LinkedIn or at certaintyadvicegroup.com.
Jim Stackpool is the founder of Certainty Advice Group and has consulted to Australian financial advice firms for 32 years.