Effective commission management is a consistent challenge faced in the financial advice space whether you’re an independent financial adviser or run an advisory firm. With growth and revenue scaling on your mind, one of your biggest goals, no doubt, is to increase and diversify your incoming commission streams.
However, this kind of growth brings challenges as well as benefits. Manually keeping track of multiple commission streams is inefficient and time-consuming, especially as your client base grows.
Deciding how to most effectively track, monitor and manage your commission fees is a vital decision for enabling unlimited growth. Commission management software can assist with this as well as other management functions. Read on to discover how this software can simplify and ease your commission planning.
Commission: A double-edged sword
In an industry where trust is a prerequisite for most individuals before they accept the advice and services of IFAs or advisory firms, you need to spend the necessary time reinforcing and maintaining relationships with clients.
As a financial adviser, you’re likely spending a good portion of your day building client relationships, engaging with clients, performing assessments, leveraging advice and recommendations, updating and amending portfolios and onboarding new clients.
This leaves little to no time to monitor the state of your incoming commissions, assess the performance of your sales teams or identify key areas for growth within the practice. As your practice grows so does your client base, which only makes it harder to acquire a high-level perspective of the state of your commissions.
The more your commission grows and diversifies, the more difficult it becomes to track the state of incoming commissions, calculate commission rates, follow up on each commission and monitor the overall growth and performance of your commissions over time.
For an IFA, this makes business growth more challenging and for managers overseeing sales teams, it becomes more time-consuming to manage and track individual and team sales performance.
How can commission management software simplify calculating commission?
This software helps advisers and firms track and monitor the state of their commission streams, both individually and in tandem by automating the commission management process.
This takes the heavy lifting off the table for advisers who can instantly access the data they require about their commission streams and use their limited time to focus on more important, core services.
Commission management software provides multiple benefits to both IFAs and financial advisery firms alike:
Manual tracking and monitoring of commission streams result in disconnected spreadsheets, siloed data and neverending version control efforts to ensure every team member has access to the latest updated information.
Commission management software eliminates inconvenient manual tracking efforts by automating all data points, classifying and representing them clearly and eliminating the need to manually track down commission data from disparate spreadsheets and systems.
Given that commissions directly impact a practice’s profitability as well as the success of sales teams, accuracy is vital to effective commission management.
Manual commission calculations and recording of figures can lead to errors and omissions, undermining commission rate accuracy and affecting payouts and performance rates of team members.
Commission management software ensures that your commission rate data is accurately calculated, aggregated, recorded and paid out.
Whether you’re operating as an independent financial adviser or overseeing a team of advisers, you’ll want to stay up-to-date on the state of your commissions across the board. This can be difficult, if not impossible, to do if you’re operating from a static spreadsheet or program that requires consistent manual data updates.
With commission management software, you and other permitted users gain access to live dashboards that provide detailed reporting on the status of your commission streams in real-time.
Beyond tracking and assessing your commissions, you’ll also want a comprehensive overview of the growth and development of your commission streams in relation to business growth over time to identify opportunities for improvement.
To do this, you need the right data, represented in graphs and other growth measurement tools.
This software provides this through detailed analytics reporting, allowing you to pull different reports to assess the various aspects of your commission structure and performance.
What should you look for in commission management software?
While commission management software is essential to mastering your various commission streams, not all software solutions are built with the same capabilities.
For instance, Commspace is a commission tracking and management software that allows advisers to run their commission management on autopilot through cloud-based accessibility, automatic data aggregation and classification, advanced revenue analytics and detailed, customised reporting capabilities.
Spend your time wisely
With commission management software, IFAs and firms can unlock unlimited commission growth, scale their business without taking on more tasks, expand their client base and elevate their net revenue.
The time that they would otherwise have spent reviewing, calculating, recording and assessing their various commission rates can be reinvested. Spend your time doing other, important processes, which will improve the quality and attention of their service and increase client satisfaction rates, helping to facilitate long-term growth.