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Advisors: Guarding Against Glitches

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Many RIAs have continuity plans in place in the event of a major technology disruption. But how many are also prepared to cope with more commonplace snafus?

Tech glitches that cause short-term downtime are more likely to interrupt the flow of daily operations than catastrophic events. A recent report by KPMG found that 35% of the IT failures reported in the financial services industry are related to availability — that is, a service or system was down when needed. Another 28% involved technology that failed to behave as it should.

It’s impossible to predict every potential glitch, but there are a few repeat offenders with a history of disrupting more than one advisor’s day. Here are a few ways to address some of the most common RIA technology snarls: 


As occurred at the New York Stock Exchange last summer, a software patch can halt business for hours. NYSE officials reported that their disruption was caused by a software update performed the previous evening. Providers send out updates to plug security holes or upgrade applications, but these are not necessarily compatible with other software. Thus, a patch or plug-in meant to fix a specific application creates a bigger problem by disrupting other programs.

Ignoring provider updates is not the answer, but advisors must be mindful of their potential impact on the rest of their IT infrastructure.


Moving to cloud-based or Web-based applications can create a perpetual state of password overload. The CRM system has one login; the custodian system and portfolio management tool have their own. It is enough to make an advisor accept the “Remember password?” prompt.

Tempting, to be sure, but don’t do it. When it is time to change the password or to access a program from a new device, you will have forgotten the password, and that can lead to some serious downtime. Industry safeguards intentionally make resetting passwords and authenticating users a laborious process.

To simplify matters, RIAs can deploy single sign-on authentication so that the same login and password will work for all their applications. Or RIAs can use a password vault management system that securely stores, changes and randomly generates passwords for all its programs. The key is to deploy these technologies via a centralized platform to ensure that advisors and their staff are logging in only from devices that the firm can track and control.


Advisors have flocked to Web-based solutions to achieve scale and increase their productivity. But working off a cloud-based platform is not the IT equivalent of nirvana.

Expensive issues arise when newer Web-based applications aren’t supported by older hardware. To prevent its operations from grinding to a standstill, an RIA should evaluate the requirements in advance.

Larger firms should also have contracts with alternate Internet providers in case their primary provider goes down. Mobile devices can also be used with local hot spots for Internet access in a pinch.

RIAs need protocols for responding to common technology events. By planning in advance, advisors can continue to operate smoothly when a glitch does take place. 

Wes Stillman is CEO of RightSize Solutions, a provider of cloud technology and business management solutions for advisors.

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