Focus on Integration

Friday, December 11, 2009 16:43
Focus on Integration

This is a common mantra I use, and it has appeared throughout much of my commentary here on operations and technology. It came up again this week in discussions with some advisors who were considering technology investments - but looking at them each in independent silos rather than considering the entire view of their business process.

In many studies on financial practices, an area of weakness is practices that do not do a good job of identifying and measuring the performance of their business investments. It is ironic that many practices build their living around measuring their client's portfolio(s) performance.

There are two distinct steps to convert this weakness to a strength:

  1. Step back and assess your practice operations and technology as a whole - looking for areas where the processes intersect (be they automated or manual) - and grade your current environment on its ability to integrate together and automate as many manual steps as possible.
  2. Secondly, identify the metrics by which you can measure items like converting a manual task to an automated task - and what that is worth in dollars and cents.

Integration is all about eliminating redundant data entry, reducing the possibility of entry errors and creating consistency ion the records you store and interact with. This alone can often pay for technology investments. Integration is also about your practice team spending more time on the client's needs:

  • Building financial plan
  • Managing reporting data
  • Creating client review "decks" (the bundles of reports and other activities for client meetings)
  • and other service issues

In this sense, you can cultivate a smaller staff with sophisticated capabilities both in the technology world and the industry - rather than having a larger, lower-skilled team of processors. By the way - in most cases - you can take this latter team and evolve them into the efficient and advanced professionals. This adds value through longevity with your practice and in the deeper relationships they can forge over time with clients.


It all comes back to integration. Eliminating the need to shuffle data, papers, files and other information across desks by selecting technology tools that not only meet your requirements but have an open architecture to share data with the rest of your platform. 

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Comments (3)

Eric Clarke
I couldn't agree more. We've seen advisors get big efficiencies when they select applications that are the best fit for their firm's business model and unique way of doing business. CRM, Financial Planning, and Portfolio Accounting are 3 applications that can bring big operational efficiencies to an advisory firm when integrated properly.
Eric Clarke , December 14, 2009
I would also add a rebalancing and trading system to the integration list of key applications. Our RIA clients have seen a 60 to 90% increase in productivity related to portfolio monitoring, rebalancing and trading.

We also concur in that the number one technology pain-point we've heard from our clients is interoperability between systems. We have solved for this by providing an integrated suite of investment management and business automation technologies in our web-based Advisor 9 offering.

Advisor 9 integrates:
- Advisor Rebalancing
- Advisor CRM (a customized version of Microsoft Dynamics CRM that operates through Outlook)
- Advisor Performance Reporting
- Tamarac AdvisorServices (an outsourced portfolio management offering using a hosted version of Schwab PortfolioCenter)

The response from our clients that have added the full integrated system into their firm has been phenomenal.
Mathieu , December 14, 2009
Thanks Eric and Mathieu for your comments. Integration is the mantra for 2010 - and the pressure is on users to understand and explore how to fit it into their processes. Additionally - the pressure will remain very high on service providers to continue to broaden their open architecture to integrate with other providers in the financial services vertical.
bwarrene , December 15, 2009

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