Independent financial advisors and broker-dealers are radically shifting their thinking and practices related to technology, and it’s about time, experts say. This transformation is being discussed in depth at the TechLeaders 2013 conference, on tap in the greater Dallas area Thursday and Friday.
“As an industry, we approach these issues as islands, and this has worked well enough for the past 20 years,” said David Fetter, CEO of Quadron Data Solutions. “But this is no longer effective, and all [our technology islands] are under attack.
“For broker-dealers, pressure on margins, from advisors and investors (and their high expectations) and regulators are intense. We have problems in the industry, and, fortunately, now we have solutions,” Fetter said.
The latest data collected by TechLeaders, in cooperation with Beacon Strategies and Investment Advisor magazine, says there has been a 117% shift toward looking at third-party providers. “There’s now a pronounced look being taken at third-party providers and more confidence” in utilizing these resources, said Chip Kispert, editorial director of TechLeaders and managing partner of Beacon Strategies.
“Most folks have gone to the dark side from the traditional … view of investing [only] in ourselves when it comes to technology,” said Marshall Levin, a managing partner with Beacon.
In addition to data management issues, the industry is being hit by a number of challenges on the communications front as social media becomes more important, others say.
“There’s more and more pressure,” said Blane Warrene, senior vice president of customer communications for RegEd. “Demands in the shift world of communications are creating an intense amount of force on how to differentiate yourself online and compete with those down the street, who are all using a variety of platforms.”
For instance, says Warrene, advisors need Google+ accounts to “be fully tapped into the social media scene, and your compliance department may say no to this move.”