(Almost) Painless Scale

[holtby]

Current outsourcing firms which I am very pleased with have been using for more than 5 years:
B-Ready Outsourcing Solutions - use for portfolio performance reporting and reconcillation

GS Compliance - use for all my compliance functions



Outsourcing firm I need:

Firm which works with Naviplan



Let me know. Christopher Holtby, Midland Wealth Mgmt, holtby@midlandwealth.net

[Michael E. Kitces]

Bob,
There is a great listing of a broad range of virtual outsource providers on the website for Virtual Solutions Consortium (www.virtualsolutionsconsortium.com).

Respectfully,
- Michael

Publisher, The Kitces Report, www.kitces.com
Blogger, Nerd's Eye View, www.kitces.com/blog
Twitterer, @MichaelKitces, www.twitter.com/MichaelKitces

[syntax]

Hi Bob,

Your article is not only timely but also very insightful. As a former RIA with 23 years of experience I recognize that our industry has not been served well in developing our practices as a business.

Outsourcing especially in skilled areas like portfolio, construction and risk management are deficient yet suitable alternatives that aren't prohibitively expensive for the Advisor are missing. Importantly there is a significant opportunity for Advisors to elevate their presence by institutionalizing their portfolio management process, branding their models/strategies as their own and build value for their firm by differentiating themselves from the masses.

Recent turmoil in the financial markets and humbling of the wire house platform offers a unique opportunity where the playing field has been levelled somewhat for the independent RIA or progressive B/D to fill in the void created by tarnished Wall Street and bulge bracket firms.

Since selling my RIA firm in 2007 I am endeavouring to bring such services to the RIA/B/D firms via institutional risk management platforms. Judging by the reception I concur with you the opportunity for mutual benefit is tremendous. We provide our proprietary strategies for other Advisors or we can customize strategies for them based on their preferences and attributes that best serve their clients.

Sandeep Sharma, CFA
Principal
Syntax Research, Inc.
[url=mailto:sandeep@syntaxresearch.com]sandeep@syntaxresearch.com[/url]

[kyleh]

Bob,
Thanks for the great article. We tell advisors when they are looking at what they should outsource to look at where there heart is and there expertise is not.

At Orion we see a lot of firms that run an in house portfolio management system and want to look to us to outsource this for them. The first thing firms should do is look at the costs of in sourcing versus outsourcing. Typically firms just look at license costs for the software when comparing the two. The other things to consider are server costs, back up costs for that server, training, firewall costs, IT consultants to help set up the server & security, employee costs (including benefits), management time in running that software, and computer and rent to name several. The other very important thing to look at is your opportunity cost.

In other words what could have that employee do today if they were not running your software system (i.e. revenue generating or service activities).



If you would like a copy of our free ROI analysis please contact us by going to our website, http://www.orionadvisor.com.

Kyle Hiatt

[BobVeres]

Hi all.

I just sent Christopher a message recommending Naomi Scrivener at Back Office Solutions (www.backofficesolutions.net) as an outsource provider for doing inputs into NaviPlan and a variety of other planning software packages.

And I just finished writing up a followup column about this thread. What I've asked is for advisors to give referrals to outsource providers who are providing great service to them, just as they would want clients to provide referrals based on the great service they're receiving.

Bigger picture, I think the growing outsource ecology that is growing up around the financial planning profession is a sign of something bigger that is happening in the broader business landscape. People are focusing on their expertise, rather than trying to be generalists. Somebody who happens to be very good at compliance (Cindi Hill is an example, at hilladvisors.com) eventually starts focusing on this thing he/she does well, and becomes a godsend to people who are not, say, skilled at or interested in filling out compliance forms. (I can't really think of anybody like that. Can you?) Somebody else is really, REALLY good with PortfolioCenter, learns the program inside and out, actually thinks creating colorful, beautifully-designed performance statements is fun, and that person gravitates to being an outsource provider.

So, too, do advisors who really like to manage money, and other advisors who really want to spend all their time in front of clients. These various firms all link together in a very different environment than we've ever seen in the past, where we all tap into the specialized expertise of each other, and where we all make it possible to focus 90% of our time and energy on the things we are really good at and that we think is important.

How much more powerful is that than the traditional firm where the staff people are generalists who barely scratch the surface of the powerful capabilities of business software when they're not answering the phones or filling out paperwork? Greg Friedman, who owns the Junxure CRM software, has estimated that the average advisory firm only uses about 10% of Junxure's capabilities. I suspect that you could find similar numbers with other types of software--and that represents a huge lost opportunity for efficiency and (ultimately) both profitability and getting your life back.

We seem to be getting a lot of lurkers to these discussions, who jump in to check out what's been said and jump back out again. If you've checked us out here, give a quick referral to your best vendor or outsource provider. This is a thread where you could provide real value with just a sentence or two.

Bob Veres
Inside Information

[Right-Hand-Man]

A great place to find a Virtual Assistant for your business is at www.vanetworking.com. There you can post an RFP and get your pick of the best VAs out there. You can also go to www.right-hand-man-va.com and see if we can partner with you for your success.

[Katie Wilson]

Well said, Bob! I’m probably a little partial (I work for a virtual receptionist service), but I agree that specialization is a great way to get the most out of your time. The company I work for, Ruby Receptionists, focuses on answering phones, so that other businesses – including a large number of financial planners and wealth management advisors – can focus on what they do best.

@Michael, great suggestion on Virtual Solutions Consortium! Ruby’s actually one of the only two virtual receptionist services listed on the site (under “Call Ruby,” as we’re sometimes known, after our URL: www.callruby.com).

Also, although he’s an attorney, not a financial advisor, I thought this blog post might still be relevant to your audience. A client of ours, Jeff Parker wrote this pretty substantial (and unsolicited) post a while back entitled “Reception Specialization” that talks about some of the same points in relation to Ruby.

Best,
Katie Wilson
Ruby Receptionists
[url=mailto:kwilson@callruby.com]kwilson@callruby.com[/url]

[BobVeres]

Thanks to Katie and RightHandMan for your posts. Now I'm curious.

About what? Many advisors are realizing that the person who answers their phone is the "Director of First Impressions" at their firm, the person who sets the tone for the relationship with the first conversation. Some of these people are now being trained to do a variety of things: be welcoming and helpful, help define whether the client would be a good fit for the firm (the reverse first impression, if that makes sense), schedule an appointment or get the information-gathering process started--and generally to do a lot of things that require marketing and client management skills. They're discovering that more prospects become clients when the receptionist or person answering the phone has these skills.

Which brings me to the obvious question: are those skills available from an outsource vendor? Is this something you could outsource, rather than have to go through the training process?

Bob Veres

[Katie Wilson]

Good point, Bob. Having a receptionist (or virtual receptionist) who engages with callers by welcoming them and gathering information saves the business owner time and converts more clients. Prospects feel heard and are now a little more invested in the business.

In answer to your question, yes, these skills are certainly available from outsource vendors -- although it definitely depends on the service and not all answering services offer the same personal approach. Ruby Receptionists specializes in having friendly, professional virtual receptionists who sound like they are sitting in your office, at a fraction of the cost of an in-house receptionist. We are able to take a short intake form to engage with potential clients and we're even able to track your status (or "whereabouts" as we call them). The receptionist is able to see it at a glance, so for example, she can say right away, "John is in a meeting until 12:00, but I would be happy to take a message."

Not all answering services are the same though. Justin Rockwell, a new client of ours, just wrote a blog post yesterday entitled Ruby- The New Girl in Town about his struggle to find "someone that could answer our phones when we couldn’t and professionally handle customers with the same love and passion as we do." We try our best to be "your" receptionist -- who just happens to work in Portland, Oregon, so when he said, "It’s clear that Ruby goes the extra step to be extraordinary and truly project the company as a partner with interest in our business rather than just a service," we took that as the highest compliment.

Best,

Katie Wilson
Ruby Receptionists