There is a generation divide on advisers’ views on technology and social media, a report from Wealthtime has highlighted, although it found alignment on the importance of service and human connection.

The report, published in partnership with Octo Members, sought views on succession planning for the next generation of advisers.

It found a “clear generational divide” between older and younger advisers, particularly around technology and social media.

However, the importance of retaining human connection with clients was agreed upon across all ages.

The focus groups surveyed also highlighted the need for greater support to develop the next generation of advice business owners, and noted that firms can learn from younger advisers to better serve the next generation of clients.

“A large part of the value of advice is in the relationship between client and adviser,” commented Wealthtime business development director, Keith Furniss.

“But using technology alongside the human relationship can improve the client and adviser experience and the effectiveness of advice as well as keeping costs down.

“Tapping into the knowledge and skills of younger advisers can pay dividends for firms, especially when it comes to understanding the needs of future generations of clients.

“Consolidators are now reviewing the age profile of advisers when calculating firm valuations, so there’s a clear view that young advisers are crucial to the ongoing success of firms.”

The report also found split opinions on the use of vertical integration (VI) as an exit option for advice business owners.

Some saw major inadequacies in the existing models, with participants citing problems such as culture clashes and a lack of value for clients.

However, others felt that VI can be successful, especially amid increasing regulatory demands, as both parties enter discussions with full transparency and due consideration for the needs of clients.

“We’ve been open about exploring VI acquisitions that will benefit our customers as well as support our business growth ambitions,” Furniss stated.

“There are clearly concerns about the inadequacies of some existing VI models, but we believe there is a middle ground, which supports independent advice and provides benefits to clients as well as to the advice firm and the acquirer.”

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