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Practice Management > Building Your Business

How Do Wealth Firms Stay Efficient?

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Wealth management firms and trust companies year after year face three main challenges: attaining growth, consistently meeting regulatory requirements and gaining operational efficiencies.

SunGard, a software and IT services provider, asked 129 executives how their firms positioned themselves to deal with these challenges. Respondents represented North American community banks, regional trust banks, global banks, family offices and registered investment advisors.

In a study released Wednesday, SunGard reported that 41% of executives said achieving smarter operations through efficiency was the one thing they would change to make their typical day easier.

Thirty-six percent said that enhanced client service and front-office innovation were their key priorities for growth.

Half the executives in the survey said that a comprehensive wealth management offering would give them a competitive advantage in a crowded marketplace.

Forty-five percent felt that more advisory and investment services would help them stand out amid the competition, and a similar proportion thought that providing a client-centric front-office approach would be most helpful.

SunGard said that in order to attract a new generation of wealth, financial institutions know they have to be able communicate with these clients via email or mobile devices, but hesitate to incorporate these solutions.

In fact, according to the study, 36% of respondents said their clients wanted financial planning scenarios in their online portal or through the mobile channel.

Twenty-eight percent said clients were asking for a 360-degree view of the client relationship, and 25% said clients wanted more third-party content.

The survey asked respondents for their insights on what new requirements had emerged in servicing their clients as convergence across traditional disciplines continued.

Thirty-six percent said robust data aggregation services were the most important requirement, and 32% said it was smartphone and tablet applications.

According to SunGard, market pressures are forcing financial firms to offer innovative products and services while keeping up with rapidly changing regulations. As a consequence, firms have to operate more efficiently to control costs while achieving economies of scale and business agility.

Thirty-eight percent of executives said they planned to boost IT spending for integration, workflow, audit trails and automation.

Another 19% said they would build a technology plan to help prioritize IT projects, and 15% would outsource or co-source their nonstrategic activities.

“Wealth and trust firms must offer comprehensive services that drive a client-centric approach and bolster their competitive positions, as well as improve internal collaboration among front-line talent,” Eileen Van Scoy, SunGard’s executive vice president for the wealth and retirement administration business, said in a statement.

“A firm’s ability to operate smarter could also play a larger role in advancing customer-engaged business models through integration and improved enterprise data management.”

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