Combined broker-planner BDM model slammed

by Mackenzie McCarty26 Oct 2012

An industry analyst has claimed a recent move from lender ING Direct to combine its mortgage broker and financial planner sales channels could yield challenges for the business.

This week ING Direct announced it was rolling out a national change to its BDM structure, that will see BDMs across both mortgage broking and planning charged with providing holistic support across both these channels.

However, MGF Consulting's Max Franchitto, who was once a mortgage broker and consults to financial services businesses, says that three decades in the industry have taught him this move away from specialisation in either broking or planning is unlikely to work. 

Franchitto said this was largely due to the complexity of the financial planning product world.

"Financial planning is a specialist field with many complex issues. BDMs have enough on their plate keeping up with what FoFA means to the planner and how they can add value to the relationship."

Franchitto said the required product and legislative knowledge alone would mean that the combined BDM would have to spend "more time reading that actually seeing advisors".

He added that a 'combined BDM' would need to have qualifications beyond just good sales skills, which should at the least be a financial planning qualification but ideally should be an MBA.

"Then the ultimate question remains: will they be working to develop the business opportunities of the product supplier or that of the practice?"

Franchitto said planning BDMs are supposed to offer business development support, not just push product features and benefits which he said was a "hallmark" of a mortgage broking BDM .

The credibility rating that the advisor gives to the knowledge and level of expertise of those combined BDMs would be critical in the success of such a combined model, he said.


  • by Country Broker 26/10/2012 10:21:55 AM

    Could not agree more , brokers are brokers we arrange loans , planners invest peoples money. I still see a conflict if you are both !! My PI policy does NOT cover me for any investment /financial planning advice , probably a good reason for that.

  • by 1martym1 26/10/2012 10:58:25 AM

    Reminds me of when fosters tried very unsuccesfully to intergrate their beer and wine sales BDM's. Blokey blokes trying to sell fine wine into top restruarants etc and sommileier type sale reps trying to seel beer to pubs. Was a disaster and ended up costing the CEO his job.

  • by Matt Broker 26/10/2012 11:35:38 AM

    We have just lost our ING BDM. He resigned because ING insisted he must have 85 logged appointments each month aswell as taking broker queries, dealing with file issues etc. I think instead of giving them more to do, maybe take a bit off their plate to allow them to focus on delivering quality service to the brokers that do use ING as opposed to banging down the doors of brokers who don't. Right now we don't even have a BDM and who in their right mind would step into a role like that. Good products,service etc but look after your BDM's a bit better otherwise the service will disappear.