This spring, Schwab Advisor Services announced the launch of "Project C"-an ambitious technology initiative designed to deliver high-quality, integrated solutions to advisors-and competitors fastened their seat belts. Although Schwab plans to roll out only a beta version of its new bundled, integrated solution, now called Intelligent Integration, at its annual IMPACT Conference in October, and plans to make an initial release available at year-end, the simple fact that the single largest independent custodian is upgrading its platform is enough to shake up the industry.

Full implementation of the Intelligent Integration initiative is expected to take several years. If successful, it has the potential to improve software integration for advisors, making their workflow simpler, faster and more accurate. It could also change the way software is purchased by and delivered to advisors, thereby shaking up the ecosystem of technology vendors that serve the independent RIA marketplace.

The potential impact of Schwab's Intelligent Integration extends well beyond Schwab and advisors who custody with the firm. In this little corner of the technology world, Intelligent Integration's impact is reminiscent of Google's entry into the email (Gmail) or browser (Chrome) business. In each case, Google's entry shattered the status quo, rattled competitors and spurred new innovations. Whether Intelligent Integration is ultimately successful or not, it is almost certain that Schwab's move will spur competitors to redouble their technology and integration development efforts. In the meantime, competitors large and small are lining up to take their shots.

INTELLIGENT INTEGRATION?

Schwab is keeping the details of the Intelligent Integration platform under wraps for now. Here

Schwab representatives describe their goal as having a "CRM-centric" approach. What this means, in effect, is that they plan to design a technology infrastructure with the advisor's CRM software as its centerpiece. Under the Schwab plan, the CRM software will play a central role not only in the advisor's technology infrastructure, but the whole business.

And there's the rub, because Schwab doesn't offer its own CRM application. So if CRM is to be the linchpin of any Schwab Intelligent Integration, it's tough to evaluate the validity of the platform without knowing more about this key ingredient.

THE SETUP

Schwab plans to offer Intelligent Integration two ways: as a complete, turnkey solution called Schwab One-View Office, and as a mix-and-match of advisors' favorites called Schwab OpenView Gateway. With the turnkey configuration, an advisor would sign up for a set of Schwab-selected applications, initially consisting of a CRM, the Schwab custodial platform, and a portfolio management and reporting system.

Although no specific software products have been mentioned yet, it is a good bet that Schwab's PortfolioCenter will be the initial portfolio management application. Neesha Hathi, the Schwab Advisor Services vice president who's heading up the Intelligent Integration project, indicated that Schwab may eventually offer two or more turnkey configurations. Schwab also intends to expand the suite of applications over time. Likely additions include rebalancing, financial planning and document management software.

The modular configuration will eventually integrate industry-leading products in all the major software categories. Schwab's planning to poll advisors and include their opinions in the evaluation process. Under this model, Schwab will work closely with vendors to ensure "tested, high-quality integrations," and the advisor will deal directly with the vendors for sales and service, not Schwab. As is the case with the turnkey configuration, the initial implementation is likely to be limited to the custodial platform, CRM and portfolio management software, with other types of software to be added at a later date.

In both configurations, Schwab expects that in formation relating to a client will be entered in the CRM system first. The CRM system will then be integrated with Schwab's back office as well as third-party applications so that all information flows to applications from the CRM system-and information from other systems flows back into the CRM system as well.

For example, if you entered information on a prospect in the CRM application, and that prospect was ready to become a client, a couple of mouse clicks would send the existing CRM data to Schwab's back office so that you could open the new account(s). Later, if you wanted to initiate a financial plan for the client, much of the client's data would flow from the CRM system into the financial planning system to populate the required fields. Account balances, financial planning, portfolio alerts and other vital information would flow from the appropriate programs back to the CRM software.