4 Signs That It’s Time to Adopt Investment Management Technology

Today’s advisor technology offerings have the power to boost a firm’s efficiency, both in the front office and the back office.

Financial services technologies are “hot”: Adoption of digital tools that simplify, support, and/or streamline money management has doubled just since 2015. But your advisory firm is probably doing okay without the latest technology... right?

If your firm is hesitant (or just slow) to launch tools designed to increase efficiency, consider that the most successful advisors use more technology — and spend more on technology — to drive growth and scale. They understand its value in creating greater efficiencies and in creating a better overall client experience.

Here are four signs your firm is ready to take advantage of technologies that can help improve how you do business:

You spend less than half your time nurturing clients and prospects

In this case, you may be among the majority of today’s financial advisors who wish they could spend more time with clients. Many advisors spend the majority of their time managing portfolios, doing administrative work, and other low-value activities. If that’s you, it may be time to find a solution that frees you up to spend your time building your business. Technology can take on everything from performance reporting and recordkeeping to portfolio management, transactions and trades, aggregation, account reconciliation, and more.

You’re not acquiring assets fast enough

It’s been shown that advisors who are enabled to spend more time with clients generally fare better than those who can’t: they have an annual growth rate higher than that of advisors whose time is focused on investment management. They also have more clients, greater annual asset growth rates, and greater annual revenue growth. In other words, technology makes it possible to remove repetitive, low-value work from advisors’ desks and give them more time to spend where it makes the biggest impact — with clients. If your business isn’t growing the way you’d like it to, it could be time to bring technology into the mix.

You’re as bogged down with paper as you were five years ago

Technologies that organize and store documents are making old-school systems — and the potentially costly errors that come with them — things of the past. Today’s technology makes it possible to optimize most processes within a firm, automating everything from workflows and reporting to compliance, client correspondence and statements, online transactions, account management, due diligence, trade confirmations, and more. Even the account opening process can be completely paperless. The impact of technology in optimizing a firm is significant: automation can help firms save up to 60% on time-to-resolution of repetitive tasks, with the added benefit of accuracy and reduced costs.

Your HNW clients are asking for better digital capabilities

Many high net worth clients, especially those under 40, are asking for (or, rather, demanding) digital capabilities to support their portfolio and relationship management needs. Finding a technology that offers an intuitive, convenient platform for them to engage with advisors should be evaluated as a priority for any firm eager to serve clients and ensure their long-term loyalty. Investors of all ages may want more technology applied to investing and, if used effectively, might actually increase clients’ trust in an advisor or firm.  

Today’s advisor technology offerings have the power to boost a firm’s efficiency, both in the front office and the back office, and can relieve advisors and staff of activities that don’t directly contribute to growth. Taking a critical look at the amount of time being spent on low-value tasks and on your current growth trajectory could reveal a number of opportunities for improvement that can be solved by implementing the right digital solutions.