Over the years technology has become an integral part of an advisory business.  

    But with all the great intentions and improvements made, we’re at a stage where adding additional software creates greater and greater complexity. Back-office systems, client-facing platforms, cashflow planning tools, digital fact-finds, report writing, etc. And that’s not to mention keeping on top of regulation and compliance, employee management, company accounting and servicing your clients.  

    Running an advice practice, is in some ways, harder than ever.

    To deliver advice, firms typically have between three and five different core technology systems, plus three or four other technology tools. And these different technologies often aren’t integrated to share information between them.  

    Poor integration can lead to advisers and support staff having to spend a considerable amount of time re-keying data. Even if you do have APIs, it depends on whether it’s a bespoke one allowing full functionality of the service, or a standard off-the-shelf one (which most are) that leads to issues of not all information being uploaded/downloaded, with manual workarounds having to be implemented.  

    In addition, most are one-way, rather than two-way integration. Even with more attention to integration, the user experience of having to use separate software and logging in and out of tools is generally poor and quite frustrating.

    And all this can lead to the risk of conflicting outputs. This makes it far harder for you to do your job with constant checking to ensure the correct data is being used.

    The way forward

    Every modern business today utilises technology. And the tech that advice firms use can make a significant difference to business profitability, staff morale and client satisfaction. It can also help to reduce risk, increase the quality of business MI (which can lead to greater robustness of information for the regulator) and reduce professional indemnity insurance.

    So, what’s the solution?

    Before looking at finding ‘solutions’ it’s worth considering what a ‘tech stack’ is and where you begin to ensure that yours aligns with your specific business needs.

    A tech stack refers to the technology a firm uses to build and run their business. For advice firms, a tech stack would typically include software to help businesses automate:

    •     Factfinds
    •     Risk profiling and portfolio mapping
    •     Cashflow modelling tools
    •     Investment research
    •     Client facing portals
    •     Back-office system

    This is in addition to your typical business use of email and diary systems along with your website.

    Why your tech stack matters

    According to research carried out by NextWealth late last year, most advisers believe platforms offer the best value for money while back-office systems offer little ROI.

    The same survey also found, perhaps unsurprisingly, that client portals, better integrations, and common data standards all help to reduce re-keying.

    Although some firms are returning to a single source tech approach because of poor integrations, many firms are using quasi-integration to control costs, boost profits, and control the customer experience.

    One system that does it all… or a best-of-breed, linked and automated solution? To my knowledge, there is no ‘one system’ that does it all. The advantage would be that you deal with one provider and everything is linked and automated. Euphoria, I hear you say.  

    But is it? Well, we’re not there ye,t but do you trust having all your eggs in one basket? Does each individual tool match others on the market? Does it all come together as you’d like? There are many points to consider.

    Or do you use best-of-breed, utilising modern modular technology that can link and automate the client journey and adviser use so it feels like only one (or two) systems are being used?

    The other problem is cost…

    Typically, a small financial planning firm’s technology spend is approximately £10,000 a year per adviser.

    Although this doesn’t include the costs of a managed portfolio service (MPS) and associated technology to monitor this.

    And costs aren’t the only issue….

    If your technology is limiting what you can do and making it difficult to deliver a clear, compelling story to your clients, or a wider range of clients, it may be worth having a good look at what solutions are out there.   

    But before you do it’s worth taking some time to consider what it is you are looking to achieve with your business and how you want things to work.  

    Rushing off to see another shiny tool and replace an existing one isn’t going to be of great benefit. Looking at your business taking a more strategic view and understanding what you want to achieve and how you want to achieve it is key.  

    Looking at processes or journeys as a whole, rather than individual tasks will lead to greater improvements all around.

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