As we turn the page on another year, many financial services firms are grappling with how to help advisors who are still struggling with one key aspect of their practice management: gaining control of their time.
An alarming 60-70% of an advisor’s time is spent on non-revenue-generating activities, raising the question of how they can possibly dedicate necessary time to client relationships and prospecting if they want to grow their businesses.
Firms that wish to help advisors modernize their practice management – such as custodians, TAMPs, broker-dealers and large RIAs – are turning to innovative technology. But there’s a huge upfront investment of time, resources, energy and money with implementing new technology, making implementation challenging.
No doubt, asset managers, custodians and TAMPs have the opportunity to bring modernized solutions to the table to help advisors untangle this web and unleash the full potential of their practices. But the process leaves some firms scratching their heads, trying to figure out how to modernize technology without sinking vast amounts of resources into a technology upgrade.
Firms should be aware of the questions every advisor asks before making key investments: Which areas of my business should evolve to maximize the impact of technology?
How can I best unlock my practice’s full potential at scale and with ease?
Understanding Advisors’ Shift Toward Managed Accounts
Advisors are trending toward managed accounts. In fact, more than one in two financial advisors use managed accounts, which has tripled from a decade ago.
And why not? It’s a great solution to help advisors increase scale and personalization in account administration while getting out of the investment management weeds. Managed accounts help advisors streamline day-to-day investment management operations, gain efficiency, save time, tailor portfolios based on investment objectives and simplify performance tracking.
As the use of managed accounts grows, financial services firms partnering with advisors can benefit from understanding this shift, especially as the trend toward personalization and scalability continues. Technology that runs alongside the current trends will power advisory growth more rapidly.
Firms should take a look at their technology offering and identify gaps that advisors are looking for.
Evolving Your Technology To Keep Pace With Advisors’ Changing Needs
The fintech landscape evolves fast, and many financial services firms are operating on outdated infrastructure. In turn, advisors using legacy technology are forced into manual, error-prone processes, disrupting the seamless workflows needed in their dynamic environments.
Moving away from outdated systems doesn’t have to be costly or overwhelming. And it’s a better option than risking data quality and potentially harming reputations.
Moving away from outdated systems doesn’t have to be costly or overwhelming.
The more you delay the transition out of legacy systems, the more wealth managers become pigeonholed into slower, less efficient processes. This impacts their ability to focus on revenue-generating activities because they spend time and energy on systems that no longer support productivity.
If you can solve this problem for them, they’ll be all the more loyal.
Implementing Modern Managed Account Solutions
If you want to help advisors navigate the path to growth without sinking all of your resources into a costly technology implementation, managed account technology with cloud-based, API-first technology could be the solution.
Managed account technology with cloud-based, API-first technology could be the solution.
Modern managed account technology flexes to serve custodians, financial technology partners, RIAs and broker-dealers, TAMPS and asset managers. It empowers advisors to meet demands for high-touch personalization while streamlining operations in the areas that matter most – putting time back in their day to build client relationships and foster growth.
Plus, finding a customizable solution provides advisors time to home in on the workflows and components that will yield the most ROI – an advantage that most off-the-rack solutions cannot afford. This empowers firms to fast-track innovation and ensure a smooth and rapid evolution of your services.
As the industry shifts toward embracing innovation and scalability, firms that adopt these innovations will be better positioned to expand their business and serve advisors.
Jonathan Pincus is the CEO of SMArtX Advisory Solutions.
