Much has been written about how integrated technology can help advisers streamline their practices, position themselves for growth and strengthen client relationships and service. But what does technology integration actually entail?
There are different levels of integration, and not all of them make a significant difference in a registered investment adviser firm's operations. For example, the most common and basic is “single sign-on,” which merely saves clicks by sharing login details among multiple software programs.
Deeper and more beneficial integration involves essential applications regularly sharing data and working together to automate business processes and improve adviser-client communication. A broad spectrum of simple to complex client and portfolio management business processes can become fully or partially automated if RIA firms' major applications — such as client relationship management, portfolio management, and trading/rebalancing systems — communicate with each other in this fashion. Below are examples of how RIA practices with integrated technology platforms can improve workflows across their organizations.
TRADING NOTIFICATIONS MADE SIMPLE
Executing account trades is not usually a difficult task, but the process of notifying clients about those trades can create bottlenecks within RIA practices. Since only financial advisers are allowed to make trades, organizations without integrated technology systems often leave advisers with the time-consuming task of creating and sending client emails about trading activities.
(Related: Tech's role in deepening adviser-client relationships)
However, when a firm's CRM and trading/rebalancing systems are meaningfully integrated, the CRM application can automatically create client notifications about trades using data it receives from the trading/rebalancing program. The notifications can then be emailed to clients by executive assistants and other lower-level employees with access to the CRM system.
This automated process saves advisers time, which can instead be devoted to account management and client service. Furthermore, this workflow efficiency is compliance-friendly because while the trading alerts are created automatically, the advisers execute the actual trades.
TOUCHPOINT AUTOMATION
If CRM, portfolio management and trading/rebalancing systems are sufficiently integrated, these applications can set frequency levels for all touchpoints within organizations, such as phone calls with clients, trade notifications, secure client portal log-ins and reporting, and do so for both individuals and groups of clients. After frequencies have been established, the CRM can record when these touchpoints take place and send notifications to advisers if too much time has passed between interactions.
For example, if reports haven't been generated or calls haven't been made within an account's selected timeframe, an RIA practice's portfolio management system can communicate this to its CRM counterpart, which can then email alerts to the respective adviser. Using information from the portfolio management application, the CRM can also notify advisers if clients have not logged into their secure portals with any frequency.
SMOOTH, SEAMLESS CLIENT ONBOARDING
When applications can freely exchange data and complement functionalities, they not only create workflow efficiencies but also establish a well-defined process for onboarding clients.
In the first stage — prospecting — an RIA firm's CRM system gathers and stores information about a potential client. When the prospect becomes a client, the CRM can share this data with the portfolio management application to facilitate the opening of the new client's account, and set up the client's secure online portal. After the account has been opened and the portal has been activated, the CRM and portfolio management systems can exchange data with the trading/rebalancing application to help the client's adviser build and monitor a portfolio. Finally, all the major applications begin acting in concert to notify the client about trades and other account activity, ensure frequent interaction with the client, and provide up-to-date account data.
This streamlined onboarding process can be replicated, creating a smooth transition and a consistent service experience for every new client.
THE WAY FORWARD
When RIA practices' CRM, portfolio management and trading/rebalancing systems regularly work together and share data, advisory firms can demonstrate value for clients to such an extent that quarterly reports are no longer necessary. However, only those advisers and organizations with meaningful integration can achieve these workflow efficiencies.
Stuart DePina is group president of Envestnet | Tamarac, a division of Envestnet Inc.(More insight: Stuart DePina on how robo-advisers can drive growth at RIAs)
