The benefits, risks and consequences of templates and checklists
“Looks like we got this,
Another Country Song Checklist”
— Will Thompson, Case Assessor AFCA
The advice process efficiency dilemma has only become greater with ever-increasing regulatory requirements and complexity. We appreciate that, in today’s business environment, organisations must find ways to improve efficiency and productivity. The corollary to this is that when we focus too much on business efficiency, we can lose critical elements of personalisation that help us get to know our clients and meet the requirements of the Professional Standards.
One popular strategy for achieving this balance is the use of templates and checklists in business operations. Templates provide a standardised structure for various business documents, while checklists serve as a tool to ensure that essential tasks are completed accurately and consistently. By providing a clear framework, templates and checklists help streamline operations, reduce errors, and enhance overall performance. However, while the benefits of using templates and checklists are appealing, their reliance also poses certain risks and consequences that need to be carefully considered.
Enhancing efficiency and mitigating errors
Templates provide a standardised framework that saves time and effort by eliminating the need to start from scratch for routine tasks. Instead, advisers and their staff can simply fill in the necessary information, resulting in faster completion of repetitive tasks. Moreover, templates ensure consistency and accuracy by providing a structured format that guides practices in executing their tasks correctly. Similarly, checklists act as a reminder for the necessary steps to be taken, reducing the likelihood of human error. By following a checklist, practices can ensure that all crucial aspects of a process are completed, leading to improved efficiency and avoiding costly mistakes. In this way, the use of templates and checklists can help businesses optimise their operations by streamlining processes and increasing productivity.
Templates also reduce the chance of making mistakes, for example, using a file note template ensures that the adviser can tailor their template to ensure that all the talking points they want to address with a client are noted so that they act as conversation prompts, acting much like a meeting agenda for the adviser and the client. This not only saves time but also reduces the possibility of leaving out critical details. Similarly, checklists act as a reminder of the essential steps and procedures that need to be followed, ensuring that no crucial tasks are overlooked or forgotten. By adhering to established templates and checklists, businesses can significantly decrease the risk of errors, which, if left unnoticed, may lead to costly consequences such as losing clients, legal issues, or damage to the company’s reputation. Therefore, leveraging these tools is crucial for maintaining operational efficiency and mitigating risks in business operations.
Effective onboarding and skill development
Templates and checklists also assist with training new advisers and support staff to help give them a structure to follow, thereby enhancing their understanding of the end-to-end advice process. Maximising the value of training time is an essential goal for practices looking to streamline their onboarding processes and improve skill development. Templates provide a standardised framework for organising information and procedures, allowing new employees to quickly grasp the necessary steps and tasks. By utilising templates, businesses can ensure consistency and accuracy in training, reducing the likelihood of errors or misunderstandings.
Checklists, on the other hand, are a valuable tool for both trainers and trainees, guiding them through the required actions and ensuring that no crucial steps are missed. These aids can expedite the onboarding process by providing a clear roadmap and allowing employees to become productive faster. Additionally, templates and checklists enable practices to scale their training efforts by easily replicating tried-and-tested procedures for different teams or departments.
However, it is important to recognise that the effectiveness of templates and checklists heavily depends on their quality and appropriateness for specific tasks and individuals. Over-reliance on templates and checklists without fostering critical thinking and adaptability limits creativity and problem-solving capabilities. Therefore, practices must strike a balance between leveraging these tools to expedite training and skill development while also fostering a culture of continuous learning and growth.
Where can templates go wrong?
Over-reliance on templates and checklists in financial advice comes with a unique set of challenges and limitations that need to be taken into consideration.
One of the potential risks is the lack of flexibility and adaptability that templates and checklists may impose. Templates are often designed to fit a general scenario, and as such, they may not capture the unique elements or complexities of a client’s relevant circumstances. Furthermore, checklists can become outdated or irrelevant if not frequently updated or adapted to changing legislative circumstances, which can lead to mistakes or missed opportunities. Additionally, relying too heavily on templates and checklists can create a false sense of security and overlook critical thinking and analysis skills that are crucial in the advice process. Therefore, it is essential for practices to strike a balance between utilising templates and checklists for efficiency while also recognising their limitations and being open to alternative approaches when necessary.
Commonly we find template and checklist errors such as:
● Template errors referencing a different client through copy-paste errors;
● Inadvertently stating that a task was completed for a client when it hasn’t been done yet;
● Lack of tailoring to the clients specific needs, objectives and context of conversations.
These kinds of oversights highlight a “cookie cutter” approach that suggests the practice has not taken the extra time to ensure that each client’s details are accurate, their needs are clearly being addressed and records are kept complete.
Finding the balance
Balancing creativity and standardisation is crucial when it comes to utilising templates and checklists in financial advice businesses. While templates and checklists have undeniable benefits in terms of efficiency and consistency, their excessive use can stifle innovation and hinder adaptability. Over-reliance on standardised templates can restrict the freedom to think outside the box and can limit the generation of fresh ideas. Furthermore, rigid adherence to checklists can lead to a lack of agility in responding to dynamic legislative environments and may miss context that is crucial to specific clients needs.
Nevertheless, when used appropriately, templates and checklists can serve as valuable tools in streamlining processes, ensuring compliance, and reducing errors. The key lies in finding the right approach that strikes a balance between standardisation and creative thinking. By encouraging all staff in your practice to use templates and checklists as a starting point and then allowing for customisation and improvisation, advice practices can foster both efficiency and innovation, ultimately leading to sustainable growth and success.
Bringing it all together
“I’ve got to give it one good try
Gotta take my chance tonight
I’ve gotta get it right the first time””
— Billy Joel, Practice Principal
Excellent templates are those that have enough prompts to cover all the areas that advisers need to address with their clients, whilst promoting and encouraging enough free-text responses to capture clients personalised information, needs, objectives and context.
This is relevant across all templates, including file note, checklists, RoAs and SoAs, SMSF suitability and numerous others. Any template or checklist should ensure that no regulatory requirement is missed, whilst ensuring that each document maintains the flexibility to tie together the clients unique needs throughout the advice process, and make this easy to follow and understand as an end-to-end process.
The overall impact and consequences of utilising templates and checklists in advice practices can be both beneficial and detrimental. On one hand, the use of templates and checklists can streamline processes, save time and effort, increase efficiency, and ensure consistency in practice operations. On the other hand, over-reliance on templates and checklists can hinder creativity, reliance on intuition and personalisation of clients’ needs. Additionally, the misuse or inadequate customisation of templates and checklists can lead to oversimplification, improper decision-making, and potential legal or ethical issues.
Therefore, it is essential for advice practices to strike a balance between the benefits and risks associated with using templates and checklists by regularly reviewing and updating them to accommodate regulatory change, and to fit specific needs and circumstances. By doing so, advisers and their teams can harness the advantages of these tools while mitigating their potential negative consequences.
If you have questions about the templates and checklists that you are presently using, please reach out to your Compliance Team, or reach out to us at email@example.com