Stasis is the enemy of financial advice in Australia today. Some firms avoid changing the way they do business because they are accustomed to doing things a certain way.
They might view new technology with scepticism since it could replace existing workflows and processes that have been in place for years. As the saying goes, if it ain’t broke, why fix it?
The adoption and deployment of financial technology solutions at different stages of an advice practice’s journey can fundamentally change the way that firm operates, but sometimes external factors, like a pandemic, can have a transformative impact by forcing change as well. Having robust technology systems leaves firms in a better position to effectively manage client relationships and scale the business—no matter what changes occur.
While the average number of platforms used by financial advisers has reached a 10-year high, overall adviser satisfaction with platforms dropped from 72% to 67% this year as more and more advisers seek a better integration between client relationship management systems (CRMs) and standalone modelling tools.
Recognising the growing compliance burden that advisers face remains critical, in addition to dispelling some of the fundamental myths surrounding barriers to adoption of the latest fintech solutions.
Myth #1: Switching to new technology will be more trouble than it’s worth
In today’s fast-paced world, keeping flawed or outdated systems in use due to familiarity will hurt a firm in the long run. Research from Investment Trends has found that in this highly-competitive space, it is imperative platforms listen to the needs of advisers.
The benefits of reliability and efficiency gains that can be realised by switching to new technology are profound. While the initial switch might result in short-term pain, by abandoning legacy or outdated systems, an advice practice will be better placed to future-proof itself by keeping pace with an evolving regulatory environment.
This means being able to navigate mounting pressures, overheads and compliance costs in addition to having the latest data and tools available to remain better connected to their customers.
Through adopting newer technology and systems, advice firms can become more informed about their customers and help drive improved levels of engagement at each touchpoint in the customer journey. That’s why it’s so important that decision-makers carefully vet technology to find solutions that are user-friendly and easy to manage.
Intuitive dashboards, seamless integration and streamlined automation are all features that can improve user experience and encourage employee adoption.
Myth #2 My team isn’t ready to switch
Staff may resist change that disrupts normal workflows, even when new software will make their lives easier. If a leader is worried their team isn’t going to use the system — either because of a lack of knowledge around it or an unwillingness to embrace the new, ensuring buy-in is key.
Emphasise the long-term benefits, even if it is inconvenient in the short term. Standard adoption reports can be used to help track and identify capability gaps in your team as well as where additional training may be needed. Additionally, many technology providers deliver onboarding and training remotely, so even if a team is spread out across different locations, they will still be properly trained.
Myth #3 A CRM is only for my sales team
Forming a deep understanding and knowledge of clients is essential to everything a business does. It is no longer just a Rolodex. Having one place where all of that information is available and up-to-date will streamline vital processes for everyone with any kind of client interaction. This is not just limited to a marketing or sales function.
CRM platforms can be used to manage alerts, audits, important dates and marketing and compliance issues. With a customised dashboard, you can have actionable insights around the performance of the overall business, the quantity and quality of client engagements and leading indicators surrounding your new business pipeline and workflow.
Another useful feature of CRMs is their ability to save time by automating manual tasks such as sending emails and reminders to clients, in addition to intelligent record-keeping across the different channels of interaction across the customer journey.
CRMs can also perform advanced data analytics processes to monitor your conversion rates and level of engagement with existing clients, helping firms move more efficiently than ever.
Myth #4 My firm is too small and using a CRM platform is time-consuming
Small firms often fall into the trap of thinking that their client list is small enough to maintain without dedicated software. Financial advice firms of all sizes can benefit from the client management, visibility, and workflow automation tools offered by today’s leading applications. Additionally, adding the latest technology can set a business up to expand and add new clients, a must for any emerging firm.
A robust CRM platform can reduce time spent manually inputting data in multiple places. A good performance optimisation platform can also help that data do more for financial advisers by providing rich analysis and insights to help inform strategic decisions.
Although some data entry is required to keep records up to date and accurate, it’s well within the routine data management work carried out at financial planning firms on a regular basis.
Myth #5 New technology will make financial advisers obsolete
Rather than making financial planners obsolete, new technology is helping them be more dynamic than ever before. New tools to store and analyse data can stretch a firm’s capabilities.
Advancements in communication tools and client portals will help strengthen client relationships and keep them engaged. Regardless of the number of low-cost or free financial advice resources available today, clients are still looking for a real person who cares about their financial well-being to bounce ideas off. When it comes time to make major financial decisions, clients want to base those choices with expert advice and guidance.
Old habits die hard, but sometimes all it takes is a little research and an open mind to find a new solution to help scale and streamline a business while supporting staff, no matter where they may be working.
Staying up to date on fintech enables firms to be more efficient and tackle any changes.
As with everything advisers do, it’s important to take a thorough and pragmatic approach. Embrace every opportunity, but be realistic. If a leader does that, new clients, new profits, and a more efficient workplace will all be part of your future.
Umesh Banga is senior director, go-to-market for Practifi in Asia Pacific.
