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Technology by the Numbers

By Adam Moseley, Wade Spencer

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Even in the challenging market and economic environment, independent advisory firms are looking for opportunities to position themselves for long-term growth by investing strategically in their businesses. According to the Charles Schwab 2009 RIA Benchmarking Study, firms reported that they view technology investments as an integral part of maximizing efficiency while delivering high levels of client service. One in five advisors in the Schwab study describes their firm as an “aggressive” technology investor, with technology playing a critical role their business.

Why They Buy

Firms purchased new technology primarily to increase efficiency and enhance client service. Percent of respondents who said the motivation for their decisions were important or very important to:

Make our processes more efficient, saving us time 95%

Enhance the service we provide to clients 90%

Reduce our risk by increasing quality of processes

and reducing potential for error 84%

Set up our business to scale in the future

while adding fewer staff 82%

Help us differentiate firm from competitors 49%

Enable us to service new types of clients 30%

What Their Challenges Are

Firms’ top technology challenges included integration with existing systems and selecting a vendor. Percent of respondents who called the following issues a challenge or major challenge:

Integrating with existing systems 50%

Selecting the right vendor or solution 48%

Design changes to workflow 46%

Measuring and tracking success 42%

Prioritizing technology or operational

areas to upgrade next 31%

Getting staff to use technology 29%

Hiring staff for technology and operations 19%

Which CRM Features They Use

Advisors participating in the study reported high adoption rates for technologies aimed at enhancing productivity, with 82% using a CRM system. But while virtually all CRM users store client contact information, many advisors still aren’t maximizing the full potential of these systems. Three out of 10 users have not taken advantage of office-integration features,and fewer than half have integrated their CRM with their document management or portfolio management systems. Percent of respondents who use their CRM system to:

Store client contact information 98%

Prepare and send client mail 71%

Integrate with e-mail 69%

Assign and track workflow 62%

Access CRM remotely 61%

Create standard task lists 50%

Store client reports and paperwork (e.g. integrate with document management): 42%

Integrate with portfolio management system 32%

Source: Charles Schwab 2009 RIA Benchmarking Study of 610 RIA firms that custody with Charles Schwab.

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