A white paper released by SEI Advisor Network and ActiFi Inc. in March challenged advisors to integrate technology and automation more efficiently in order to run a more successful practice.
“Far too often, knowledge about client relationships and key processes resides in the heads of one or two people. The business risks are high, especially for growing firms, as balls get dropped, client service suffers and onboarding new employees is virtually impossible,” says the paper, authored by SEI’s Raef Lee and John Anderson, and ActiFi’s Spenser Segal.
By creating workflows that integrate technology and automation, advisors can create repeatable processes, capture data to identify inefficiencies, and optimize sales, service and operations, according to the paper, “Workflows: The Key Ingredient to a Sustainable and Sellable Advisor Business.”
Recent research found 58% of advisors who say they have workflow processes in place actually rely on memory, Post-It notes and to-do lists to implement tasks. A similar percentage (57%) said they don’t have much confidence in how much the tools they use will help the next generation of advisors in their firm.
The authors wrote that the most successful advisors and their support staffers are “unconsciously competent. They innately recognize opportunity and know how to capitalize on it.” That makes it hard to transition the business to a successor, or even to operate the business while those key players are away.
“We believe that system integration and defined workflows are becoming a distinguishing characteristic — and critical success factor — for today’s most enterprising advisors,” the author’s wrote.
The paper broke down the process of establishing a workflow into four phases.
In phase one, firms need to get organized. Identify key processes — even simple ones — that need to be streamlined and break out the steps it takes to complete that process. Identify who is responsible for each step, and build a workflow framework to complete the process.
In the second phase, firms should test their new workflow. The paper suggests that if a process can be repeated 80% of the time without having to find workarounds, it’s ready to be automated.
That leads us to phase three, an “optional but highly encouraged” phase, according to the authors: automation. When a workflow is automated through the firm’s CRM, tasks will be scheduled and assigned to the appropriate person as soon as prerequisite tasks are completed.
The paper noted that just because a process can be automated doesn’t mean it has to be; “some can be executed manually if the ROI to automate is not justified.”
Phase four (or three, if the firms decides not to automate a particular workflow) is to optimize the system established in phase two, a step that the authors say will be constantly influenced by outside factors like new technology, changes in the support structure or clients’ needs, and feedback from staff. The paper suggested reviewing processes at least annually to make sure they still meet the firm’s needs.
The paper suggests that having a well-defined workflow, and especially one that is automated, will become particularly important in the future as the industry evolves to meet the needs of an aging advisor population, retiring boomer clients, more informed clientele and better technology.