Two clients walk into your firm in the same week.
One of them is a referral from a mate of yours. Complicated case, self-employed, bit of a mess in the accounts. You take that one yourself. You spend an hour and a half on the fact find. You talk about protection properly. You call them twice unprompted during the application. They tell three people how good you are.
The other one comes in through the website. Goes to whoever had a gap on Thursday. Straightforward case; 40 minutes, protection mentioned at the end when they were already reaching for their coat. Completed fine. Never heard from since.
Same firm. Same fee. Same suitability letter template.
Two completely different businesses.
Every owner reading this knows exactly which clients got the first version. Almost none of them could tell you what happened to the second.
“Nobody talks about it because we’ve all decided it’s just how small firms work.”
And nobody talks about it because we’ve all decided it’s just how small firms work. The owner’s the best adviser, so the owner takes what matters, and the rest gets covered. That’s the arrangement. It’s been the arrangement for 20 years.
The regulator has stopped accepting it.
The FCA put advice quality third on its list of mortgage priorities this year, and tied it directly to Consumer Duty – the expectation being that firms test outcomes across the whole customer journey, not at one point in it.
In April it went further and told firms to get past MI dashboards and into analysis that actually draws conclusions across different groups of customers.
“No complaints isn’t evidence. It’s just nobody’s rung yet.”
Then there’s the line from its March review that should have caused more of a stir than it did. Sales data and the absence of complaints do not prove customers understood anything.
No complaints isn’t evidence. It’s just nobody’s rung yet.
Because if you ask most small firm owners how they know their advice is good, you get one of two answers. The files pass. Or nobody’s complained.
And the file checks aren’t much better. Most firms QA 2- or 3% of cases. Two percent. On a hundred cases a year that’s two files. You could run that firm for a decade and never once review a case from your weakest adviser on their worst week.
“This isn’t a compliance problem. It’s a money problem.”
You’re not checking a process. You’re checking two different businesses and reporting the average.
The trouble is, this isn’t a compliance problem. It’s a money problem.
The gap between your best case and your average case is the clearest number in your business.
Nobody measures it, but it’s the one that decides what you’ve actually built. Narrow gap – you’ve got a firm. Something with a process. Something a buyer would pay for. Wide gap – you’ve got one very good adviser and some people who work near him.
And the wider it is, the more your reputation runs on luck. Which version did that client get?
Depends on who picked up. Most of the time it’s fine. Occasionally it isn’t and you find out about it 18 months later from a solicitor.
So go and look.
“They’re worried about what they’ll find and they’d rather not know.”
Pull 20 completed cases. Not yours. Twenty at random from the last six months. Read the fact find, the suitability letter and the protection outcome on each one and ask one question. Would I have had this conversation the same way?
Most owners have never done this. They’ll tell you they haven’t got time. That’s not it. They’re worried about what they’ll find and they’d rather not know.
You’re not looking for mistakes. Mistakes are easy. You’re looking for variation.
Where does the process bend depending on who’s running it?
Which conversations happen every single time and which ones happen when somebody remembers?
At what point does your firm’s advice stop being your firm’s advice and turn into that particular adviser’s habits?
Every one of those points is somewhere you need a process instead of a person.
That’s the work. Not a compliance exercise. Not a policy document. Going through twenty files and finding out how many versions of your firm are currently operating under your name.
The FCA will get round to asking. That’s not the reason to do it.
The reason is that half your clients are getting the second-best version of your firm and paying full whack for it.
