RIAs Barely Scratching Surface With Tech Integration

Charles Paikert’s article “How Integration Pays off for RIAs” effectively captures the bottom line results technology can drive for RIA firms with improved efficiency.

The movement to integrate previously disconnected applications used on the advisor desktop grabs the “low hanging fruit” opportunity for efficiency – eliminating repeated manual entry of data. However, we are scratching the surface of opportunity available to advisors to leverage technology to drive efficiency. For example, many of the time consuming processes advisors leverage every day to run their practice can be automated with technology, or can be far more time efficient with the use of different technology.

Rebalancing is one example of where tremendous efficiency can be achieved servicing client’s accounts – many advisors still manually calculate rebalancing trades using spreadsheets.

Financial planning is another area technology is improving advisor efficiency. Historically, advisors could answer client questions on goals using free calculators or widgets to produce a single number answer to a client question. The alternative was to spend hours creating a financial plan using comprehensive planning software. With the advent of quick planning, and constructs like the household balance sheet, advisors can address planning and goal affordability questions with sophisticated reports in 10 minutes.

Finally, the “final frontier” for technology driven efficiency will be technology that is tailored to how an advisor runs his or her business. For example, to prepare for a client meeting, an advisor may have to retrieve reports from multiple systems – a performance reporting system, a planning application and perhaps an investment proposal tool. The integrated workflow of the future will present the advisor with a single button to click – “Prepare for Client Meeting” - that would then automatically call all the disparate systems to produce the package of reports necessary for that advisors client meeting. Certainly, many of the CRM-centric workflows under development in the market are heading in this direction.

Neal Ringquist is President and Chief Operating Officer of Advisor Software, Inc., a leading provider of wealth management solutions for the advisor market.