The Case for Integrating Wealth Management Technologies: Enhanced Productivity and Customized Advice

The growing complexity of investing has created challenges for investors and financial advisors alike.  Investors face an ever-growing menu of portfolio options, investment strategies and product solutions. At the same time, financial advisors must meet investor demand for more personalized, comprehensive and cohesive advice.  For advisors, the way to earn more clients and increase assets under management is to couple goals-driven, client-centric planning, with the ability to support a wide variety of investment strategies and portfolio constructs.

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Comments (1)

The United Managed Houshold (UMH)perpetuates old technology and outdated processes, approaches to portfolio constructyion and work flows.

1. Financial planning software today is a series of disjointed calculators with no unifing expert authenticated prudent investment process (asset/liability study, investment policy, portfolio construction, monitoring and management) which supports fiduciary standing based on objective, non-negotiable fiduciary criteria of statute, case law and regulatory opinion letters. This is neededed inorder to make advice safe, scalable, easy to execute and manage as a high margin enterprise at the advisor level.

2. The brokerage format unecessarily complicates the free flow of data by virtue of a highly inefficient means to facilitate the transfer of data which has been resolved in Singapor and Hong Kong through the advancement of XBRL. The free flow of data renders the UMA and the UMH obsolete and facilitates the development of a broad range of apps which modernize portfolio construction and management that empower advisors with technical competencies like tax efficiency which are beyond the typical advisor skill set but essential for fiduciary duty.

3. It is what the advisor does with an investment or process that adds value, not products. Fiduciary standing can not be achieved by an advisor as long as advice is thought of in terms as a product the broker sells rather than a process the advisor manages. Edwards Demming, who reinvented automobile manufacturing to the chagrin of Detroit, observes "until one can define what they are doing as a process, they don't know what they are doing." You miss the most substantive point--expert, authenticated, process.

Posted by Stephen W | Wednesday, August 22 2012 at 10:24AM ET
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