Driving Change in a Changing Industry

1. Driving Change in a Changing Industry Andrew Fisher – Chief Executive 13th October 2011

2. Background “In times of change, the greatest handicap is experience” John Paul Getty

3. Background • An awful industry doing terrible things • Low company morale • Series of poor corporate ‘transformations’ • High staff turnover • Mis-selling endemic • Poor economics – small and loss making • Wrong culture/attitude

4. The Market Sir Callum McCarthy, chairman of the Financial Services Authority, said the system "fails miserably" to create long-term relationships with customers and questioned whether it served the interests of banks, insurance companies or independent financial advisers. Financial Times, September 18th 2006 “I note that as at May 2006, the top 21 IFAs had turnover of £640 million, but operating losses of £22 million – twice that of a year earlier” Sir CallumMcCarthy

5. The IFA Industry was addicted!

6. In 2006 the IFA Industry was sick!

7. In the 80’s Food Retailing was sick!!

8. Retailing – what changed? Tesco – A case study From: 1980’s Pile it high and sell it cheap To: 2000’s Focus on the customer Drive efficiency Quality product The No. 1 retailer in the UK

9. Branded Manufacturer vs. Distribution Market Capitalisation 1980 Unilever £800m Tesco £180m Pile it high – sell it cheap

10. Manufacturer vs. Retailer Market Capitalisation 2011 Tesco £30,000m Unilever £26,000m Every little helps

11. The Towry Approach To be the leading Wealth Adviser in the UK Independent, holistic financial planning supported by discretionary investment management Manifesto - 19th June 2007: Fees not Commission Education not Ignorance Integrity not Stealth Holistic not Limited Independent not Tied

12. Building Blocks I • Market opportunity • Regulatory pressure RDR + TCF + PBR • Darwinian drive • Corporate transactions

13. Building Blocks II • Culture and values • Team approach • Consultation • Decision making • Core values • Honesty and integrity • Focus • Excellence • Teamwork • + 1

14. Communicating the Message I • To our clients • Statements • Calling direct • Client letters • Comfort seminars • COI seminars • Industry seminars • Press ‘thought pieces’

15. Communicating the Message II • To our people • Roadshows • Presentations • Intranet • Shareholders conference • Induction programme • Masters programme • TCC • Staff survey • ‘Ask Andrew’

16. Set backs and road blocks • Industry resistance • Redundancy programme • Economic climate • EJ publicity

17. Results so far – AUM growth Closing AUM (£bn)

18. EBITDA growth £m Breakeven

19. Financial Conclusions • What if there’s no crisis? • Invent one • Apply the 80:20 rule • Don’t forget to pay the bills • Remember why you’re in the swamp • Give people ownership

20. Practical Conclusions • A thousand small steps • Unless you’re crossing a gorge • Put the fire’s out first • Build consensus • Unless everyone else is wrong • Publicise success • Recognise failures • Deliver the plan

21. Overall Perspective • You cannot over communicate • Everything needs to be connected • Never let a good crisis go to waste • Celebrate success • Culture is everything

22. Thank you