3 Critical Areas Broker-Dealers and RIAs Must Focus On

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The financial services (and wealth management) industry is in the middle of a digital revolution. When you look at where the industry stood even just five years ago, with respect to technology, there’s a stark difference.

This eminent shift and acceleration towards a full-blown digital era come with heaps of opportunity and challenges alike; meaning firms and institutions must re-evaluate the strategic areas of focus that will have critical implications on business outcomes.

Through conversation with several dozen firms—including Broker-Dealers and advisory firms/RIAs—on where they’re investing their time and money, and it’s evident there are three fundamental areas firms have their eyes set on and where technology is driving real impact.

The first area is enhancing the advisor-client experience.

Here’s what we know to be true…

Investor/client demands continue to evolve, and clients value relationships with their financial advisor (and the firm) where they feel they are understood and taken care of. Ensuring clients remain on the receiving end of value is essential to building relationships that span across family members and generations; taking the meaning of long-term relationships to an entirely new level.

To top it off, personalization has emerged as a major topical focus area for financial advisors in making sure that the service, advice, and value clients receive are not only catered to them but that it’s relevant to them and their needs.

Several studies, including from firms such as Accenture, claim that anywhere from 60-80% of consumers view the relationships they have with their financial service institutions as largely transactional.

The takeaway? There is plenty of room for institutions—both big and small—and advisors everywhere to do better.

Enhancing the advisor-client experience is ultimately driven by the impetus to make it easier for your clients to do business with your firm and your advisors.

A great client experience leads to trust—and trust, as we all know, is the ultimate currency.

While technology alone can not solve for improving the advisor-client experience, it can certainly provide the much-needed capacity and ability to take it to the next level.

Here’s how technology can help improve the advisor-client experience…

Innovation and advancements in the WealthTech ‘arena’ have come a very long way over the last few years and solutions, across all categories, enabling firms and the advisors that represent them, to gain capacity and efficiencies that allow them to better serve clients and meet their list of growing demands.

From capturing and documenting relevant data (via CRMs), communicating to clients(via content), delivering personalized solutions/products (via PMS and Planning Software), and improving the accessibility to information and documents (via a secure digital vault), technology can facilitate a winning client experience.

The second area is improving back office and compliance efficiencies.

With data breaches becoming more prevalent, both consumer and corporate concerns for data privacy and integrity have skyrocketed, resulting in ever-changing, more restrictive, compliance requirements and policies that form soon after.

As regulation continues to escalate, organizations are often required to spend a large part of their budgets on meeting strict compliance standards.

Building systems and processes that keep up with regulations and industry standards require resources on every level. Overcoming regulatory compliance challenges requires financial firms to foster a culture of compliance within the organization. Companies need to constantly evaluate and improve their operations to keep up with fast-changing consumer expectations, technology, and industry regulations.

While compliance teams bare the weight of ensuring compliance is adhered to across the organization, it’s important to stress that compliance is everyone’s responsibility.

Here’s how technology can help improve back office and compliance efficiencies…

Technology standardizes processes, ensures procedures are followed correctly, and enables firms to keep up with policy changes. Technology confidently enables back-office and compliance teams to streamline regulatory reporting and audit prep cycles along with ensuring corporate and client information are kept safe, secure, and accessible at all times as key pieces of required evidence and to meet document retention policy requirements.

Last but not least, the third area of focus is around creating a connected workflow.

Traditionally speaking, much of the emphasis has been around enabling advisor workflow to accommodate the needs of financial advisors and wealth managers — but this often ignores critical dependencies and even creates inefficiencies in certain areas, and across the different levels or teams within an organization.

When firms look for ways to streamline workflow and experience across front, middle, and back office functions, not only can these significantly reduce overhead costs, but it creates a massive competitive advantage in the sense that all fronts of the business are moving forward, together, and at the same pace.

This really boils down to creating a deeply embedded and integrated experience that moves away from data silos, and risks of human error via repetitive tasks, ensuring all constituents benefit from having access to information when and where they need it.

Here’s how technology can create a connected workflow across the organization…

By leveraging a best-of-breed ecosystem of solutions with deep or bi-directional integrations, in addition to APIs, technology affords firms the ability to connect the disconnected elements of their workflow (and their business) that materially improves internal processes, saving significant time and money across the board.

For Broker-Dealers and even large RIAs that offer their advisory groups/teams a technology platform or allow them to BTOT (bring-their-own-technology), it’s important to understand the implications in front of you, especially as you set your eyes on digital transformation initiatives to build a better business and scale.

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