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Technology > Marketing Technology

It’s Time for a Summer Technology Refresh

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As the calendar flips to August, things tend to slow down in the advisory business, making it a great time to take stock of where you are as a firm with your technology.

We have enjoyed an exciting sports season across the pond this summer, with Chris Froome sipping champagne on the Champs Elysee after his fourth Tour de France win, Jordan Spieth hoisting the Claret Jug as one of the youngest British Open golf champions at age 24, and the ageless one, Roger Federer, winning his eighth Wimbledon title, it’s time to get back to work before fall arrives with its inevitable busy-ness.

(Related: Two Ways LPL Plans to Innovate: New Mobile App, Virtual Assistants)

Where to start on your summertime technology refresh journey? According to a number of operational and technology experts, an overall assessment of your existing technology stack, combined with a process review, can be an ideal way to identify opportunities for improvement.

According to Matt Sonnen, founder and CEO of PFI Advisors, a leading operational and technology consulting firm to the RIA industry, advisors often struggle in three main areas:

1.) Firms have “too little technology,” where staff is forced to manually process work that can be automated, which prevents the business from being scalable.

2.) Firms are stuck with the “wrong use of technology,” meaning that the business has purchased the right systems but integration is weak, leading to inefficiencies or the current technology infrastructure can no longer support the size of the firm.

3.) Firms have “too much technology,” resulting in an over-complicated infrastructure caused by too many duplicative systems.

Based on Sonnen’s previous experience as COO of Luminous Capital, a multi-billion dollar RIA he helped launch as one of the industry’s largest breakaways, he has developed a detailed checklist for firms to use in evaluating where they are on the above scale with their various systems.

For example, when reviewing your portfolio accounting and reporting system, key areas for improvement can be found in making sure that the platform you are using can reconcile data automatically, instead of having someone in your office manually do this often error-prone and time-intensive task.

When it comes to CRM, Sonnen recommends having a documented and detailed process for capturing and entering records in the database so that information is consistent, up to date and can drive and automate various workflow processes. If your CRM doesn’t have these key features, it is time to start exploring new options, and if your firm doesn’t have a mandated, documented process in place to make CRM the key repository of client data, take the next couple of weeks and map those out.

On the financial planning front, key focus areas are on the data and input processes. Does your firm spend inordinate amounts of time gathering this client information, or can the system integrate into other systems, such as CRM and account aggregation platforms to quickly and more seamlessly process financial plans? If not, take the opportunity of the summer slowdown to get those up and running.

Trading and rebalancing are additional areas of technology and process improvement. Rebalancing in particular is one area where advanced, integrated technology can increase capacity and better personalize portfolios. Particularly when robo-advisors these days can rebalance automatically, advisors will be under pressure to have more capabilities here, such as tax loss harvesting and the ability to rebalance more frequently. Explore the exciting new developments in rebalancing technology by asking your vendors for a demo of their latest offering.

Vendor Management

Industry technology expert, Dan Skiles, president of Shareholders Service Group (SSG) and the Technology Coach columnist for Investment Advisor, agrees with this summer focus. Skiles has written extensively about the many opportunities that slower times in the calendar provide for advisors to take stock of where they are and make improvements that will pay off the rest of the year.

Skiles suggests reviewing vendor contracts and make a note in your calendar when renewals will happen. Often in many software contracts, there are terms for automatic renewals that can kick in, locking firms into another year of service, when firms may want to change out that system or renegotiate terms.

Additionally, take the summer slowdown to confirm with all of your vendors that you have the latest version of the platform. Advisor tech firms have been aggressive in updating systems and software, sometimes to the point where there can be a new release monthly or even weekly. Thus it is critical for firms to constantly stay on top of all of the latest features and functionality so that you are maximizing your technology investments.

Once your firm has gone through this summertime refresh, you just might want to take a vacation yourself. Don’t worry, Skiles has your pre-vacation technology preparation covered – check out his article here.

— Read Where Are Advisors Spending Their Tech Dollars? on ThinkAdvisor.

Disclosure: Tim Welsh has consulted with PFI Advisors and SSG on various business issues.


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