Innovation is the key to success in a rapidly evolving financial services market. But with the rise of new products and delivery platforms, advisors face competition from low-cost robo-advisors and automated turnkey solutions. Advisors also are confronting a generational shift and, as baby boomers enter the drawdown phase, advisors must reach out to a new generation of clients with different needs and preferences.
Trust Company of America recently surveyed nearly 230 RIAs in an effort to identify the challenges that restrict advisors from achieving success in the future and the roles they say technology can play in helping them overcome these obstacles.
According to the survey, the biggest challenge advisors cite is attracting new clients (33%). When technology makes advisors more efficient, it can free them up to focus on revenue-generating activities, like providing a more high-touch approach to connecting with prospects. Because technology helps advisors better serve a larger client base with a smaller staff, firms that leverage technology can also boost their long-term profitability.
More and more, financial advisors are realizing that technology is an important tool to help increase client satisfaction and profitability. However, many advisors have found that new investments in technology don’t always go smoothly. After the initial honeymoon period, the technology may fail to deliver on the promised benefits. Maybe it doesn’t hold up to real-life workloads. Or maybe employees find it less intuitive and find they have to develop workarounds. Perhaps the new technology works well on its own, but it may not properly communicate with other office systems to ensure a seamless flow of data.