There are many technology options available today for independent RIA firms to pick from, but not every one of those options is right for each organization, according to fintech and RIA experts who spoke Wednesday during a panel session called “Cutting Edge or Bleeding Edge” at TD Ameritrade’s National LINC 2020 conference in Orlando, Florida.
Meanwhile, panel moderator Joel Bruckenstein, president of Technology Tools for Today, raised concerns about the ongoing wave of industry consolidation and what it could mean for innovation.
“Technology for technology’s sake is no good to anyone,” Shannon Spotswood, president of RFG Advisory, a hybrid RIA that started in 2003, told attendees. “It is not going to provide any efficiency [and] it is not going to give your clients a differentiated experience,” she said.
Reflecting back, she pointed out there was a decision a few years back to rebuild her firm “from the ground floor up.” While doing that, she said her company had to decide “who are we as a company” and “what are our values,” and it was decided the firm was a “service company first, we’re a technology company second and we’re an RIA third.” She noted: “The order of those was so incredibly important.”
And that’s pretty much what each RIA firm needs to figure out before selecting the right technology to help run their practice, she told attendees. They need to figure out what their company’s values are and “how are you going to be an ambassador” for the technology they decide to use, she said.
It’s important to have a “mindset that you’re going to drive the success and the profitability of your firm by leveraging technology to create a really differentiated client experience,” she said.
Whether an RIA is large or small, when searching for the right tech, “you really have to start with a purpose” and decide “what are you working towards, and then work backwards,” Teri Shepherd, president of Carson Group, said.
“Technology has to enhance your experience [and] it has to enhance and improve your efficiency, and so you have to start with knowing where you’re going,” she said, adding: “You really have to start thinking with the end in mind and make sure that you’re not just thinking about technology” because it’s “just a piece that helps you get there.”
Although technology has significantly improved over the past decade and “we’ve really made some great strides … it still seems to be something that a lot of folks in the audience struggle with,” according to Bruckenstein.