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What Top Advisors Get Right on Tech

Success, it turns out, is not about having the latest technology -- it's about knowing how to use it well.

That's the key takeaway from Fidelity Institutional Wealth Services' 2013 RIA Benchmarking Study.

The "high performing" firms identified in Fidelity's study -- those in the top quartile for growth, profitability and productivity -- focused on "smart technology and adoption versus chasing the latest and greatest tech products," says David Canter, executive vice president and head of practice management and consulting for Fidelity.

Indeed, three-quarters of the high-performing firms surveyed by Fidelity described their technology environment as "strong" rather than "cutting-edge," he says.

High performing firms are "effectively harnessing the technology they have instead of chasing the very latest innovations," Canter explains. "Most advisors have three main technology systems: portfolio management; client relationship management and a client reporting engine. The high-performing firms are making them work together and making them work better with the staff."


A significant effort to optimize current systems through training and customization was the top tech initiative for high-performing firms, the study found. Other big tech projects included creating process workflows and automation; shifting to cloud-based or outsourced solutions; increasing technology integration; implementing mobile technologies and implementing a social media strategy.

Using technology to enhance the client experience and satisfaction -- an critical aim, Canter says -- was the goal of 77% of high-performing firms surveyed, as opposed to only 61% of the other firms.

Canter suggests that firms use technology to smoothly onboard new clients, reduce errors and simplify document collection. Advisors should also use CRM systems to "make clients feel like you know them," he adds, by leveraging information such as birthdays and anniversaries.

"You want to use technology to truly make an advisory firm a bespoke service that is all about customization and delivering superior assistance," Canter declares.

The study also recommended that advisors consider:

  • Streamlining their technology environment. Examine cloud-based solutions, mobile technologies and process workflows and automation.
  • Overcoming staff opposition to technology optimization. The study found the top three tech barriers were staff related. Addressing these challenges may help firms get more out of their existing technology.
  • Better utilizing the functionality of existing systems. The study found that those firms most satisfied with their systems are the ones that are making use of the tools' full capability.
  • Leveraging vendor-hosted systems. By switching to the cloud, firms can relieve the burden of supporting locally installed systems, increase capacity and have 24/7 access to data.
  • Outsourcing. Firms can improve key processes, such as data reconciliation and client reporting.

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