Most change initiatives – whether intended to boost quality, improve culture, or re-engineer technology – generate only lukewarm results. Many just simply fail. The reality is that no adviser business survives over the long term if it can't reinvent itself.
Over the last 25 years I've been blessed to work with financial advisers around the globe as they strive to build a better business, aspire to create greater internal efficiencies, and assemble a form of scale to their client experience that will improve their brand and increase their profit. Too often, I've seen these adviser dreams be built on legacy technologies with outdated interfaces that do not scale. Typically, the principal of the firm is desperately seeking a change, but is unskilled at implementing it. This is a global phenomenon that I've witnessed from Salt Lake City, Utah, to Sydney, Australia.
Our
Maryland-based RIA learned a few key lessons when we addressed our legacy systems to create a complete technology revolution in less than 18 months. It's a systems transformation that I jokingly say has taken our firm from looking like Danny DeVito to Arnold Schwarzenegger.
Most advisers I've met run good small businesses, but too often they struggle with three fundamental issues at the center of their practice: managing the business better, growing the business confidently, and exiting the business in a way that reflects the true value of their life's work.
The intent is there, but the blind-spot in needing to do all three well is apparent. Layer in the idea of championing a sizeable change initiative such as a new technology stack to keep up with competition, compliance, cyber-security, and clients, and I've seen many good advisers become paralyzed -- defending the status quo and fighting against change.
Technology disruption
We made the daring decision to attack the very heart of our business by addressing our technology, removing old tools, updating internal systems, building in what we believe are best practice processes to support the current client experience and moving our team of 25 employees to full mobile and cloud- based access. Can't be too hard, right?
Here are four lessons we experienced when we installed systems from
Orion Advisor Services (migrating over 3,000 accounts and 25 years of history), implemented
Salesforce as our CRM (uploading over 1000 client files), and integrated both with new workflows that deeply connect with Office 365, the eMoney Adviser vault, and our custodian. To add a little context, we scoped, installed and completed all integrations at the same time under the roof of one project.
We ignored everyone who said we should stagger these initiatives, and we intentionally ran the entire migration in one fell swoop! But the real story is how these efforts improved our culture, lifted our client experience, and boosted our overall efficiency to scale our growth.
Lesson 1: All change (big or small) is a project and must be evaluated, implemented and managed as a project. Our project had a working name, a project sponsor, a project manager and team of subject matter experts who knew the anatomy of our systems. We initiated an employee survey allowing associates to help shape the vision for the change. This aggressively brought the entire firm onto one page to ensure cooperation across the project. The team reported every month up to the founding partners and we tracked each element of project to time and budget.
Lesson 2: Communication is key … the more the better! We learned that people worry about change, even if it's good, so we held monthly firm-wide update meetings to provide information of the progress of the project. We connected the project back to the vision of the firm and helped bring a sense of urgency and excitement. This birthed a culture of innovation and change-improvement throughout the firm. Then we celebrated as we closed out each part of the project!
Lesson 3: Standard project techniques work! We did not hire a project manager – we owned the re-invention internally and we were all in. We used some standard ideas:
• Start with vision and know why there is a sense of urgency. Repeat the vision at every chance!
• Don't start without all owners/founding partner buy-in to the size of change and time required.
• Approval and sign-off sheets for all stakeholders and owners in the firm as you reach key stages of the project.
• Gantt Charts used at every step and reviewed by the project team weekly. Spreadsheet everything.
• Create a special place dedicated for the project and for the team to meet regularly. We called ours The War Room, installed a whiteboard and table that could seat 12 people.
• Allow for failure as people try new processes and new ideas. Build a place to safely test new tools or processes.
• Be ruthless on culture! The vision is key and the project is linked to it. Confront any conflict that clings to old ways.
Lesson 4: Focus on open architecture services and tools. We learned that by sticking to technologies and platforms that integrate using an open API code we could meet our business objectives and we future proofed the business. This is the secret to scale!
Building a best practice technology stack in an RIA today is well within grasp, but it takes a vision for a better client experience and some project change techniques to bring enduring success. When it comes to change, failure is not an option.
Jim DeCarlo is chief executive of Strategic Wealth Management Group.
