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Five Steps Top Advisors Take When Evaluating New Technology

One size does not fit all.

By Mark Mersman

In our world of increasing automation, having the right tools can streamline your practice, increase productivity and enhance the services you provide to your clients. However, investing in new technology can be a big decision. With so many options, choosing what’s best for your firm can be challenging. Following these five steps when evaluating new technology will ensure your firm has all the information it needs to make the right choice.

Focus on the Future

Many firms make the mistake of only considering their current needs, rather than anticipating how their practice may change over the next 5 to 10 years. Think about where you would like your firm to be 10 years from now and what technology you will need to get there.

When conducting a cost-benefit analysis, evaluate economic and lifestyle impact over at least a three-year period. Many benefits will not be apparent until the solution has been in place for months or even years. In addition to cost savings, financial advisors should also factor in improvements in efficiency. Could this technology free up your time to do more productive things in your practice? Would it eliminate the need for a future hire?

Consider Value

The best solution is one that fits your unique needs. While most applications can be customized, those customizations cost time and money. Each added feature should be evaluated based on its return of investment and value to your firm. Solutions designed specifically for the financial services industry are often quicker and less costly to deploy because their features are created to be a better fit for any financial firm’s requirements.

Look for a scalable solution that meets your needs today as well as grow as your business grows. A 2017 report from the McKinsey Global Institute found that automating transaction workflows has the potential to increase the scalability of these processes by 80 percent. By automating routine tasks, technology solutions enable financial advisors to be more productive and can help firms better manage their personnel costs.

Ensure Integrations

When evaluating new technology, consider its application programming interfaces with ability to connect with your existing platforms and any future ones you may need. The average financial advisor wears many hats in addition to their role as client advisor, acting as a business manager, marketer and administrator, among others. Integrating various applications for an advisor will make it easier to juggle these various roles. While the majority of financial advisors purchase technology solutions as a bundle, additional integrations are often beneficial.

Integration is especially critical for compliance software. As requirements become increasingly complex, smaller firms and independent registered investment advisors often struggle to keep up. Experts recommend that advisors use similar technology to monitor their own practices and trading activity.

Financial advisors can also streamline their business processing activities by establishing an integrated forms solution. A good e-processing platform provides a consistent portal for completing paperwork and simplifies the process for onboarding new clients by automating the completion of many forms. Integrating client data across platforms and digitizing signatures can reduce the hassle and frustration of non-indexed paperwork. Look for firms that are developing solutions that deliver a true A-to-Z offering across multiple business lines.

Consider which integrations are most important to your business. Technology should make your life easier and minimize time normally spent on data entry and other tedious tasks so you can spend that time serving your clients and building your business.

Contemplate Implementation

While purchasing a solution that can be integrated well into your business model should save you from hassle, it’s also important to understand the details of how the product will be deployed and have a proposed timeline for implementation. Ask about the solution’s ease of launch and which features will be readily available when the solution goes live. For more complicated applications, it may make sense to go live with a basic solution and implement customization in phases.

The solution you choose should be intuitive and user-friendly. If a platform is difficult to apply, your firm may struggle with adoption rates. The provider should conduct user acceptance testing with your team before deploying the solution.

Confirm Ongoing Support

Financial advisors should discuss what support the vendor or provider will offer after implementation. It’s important to understand how bug fixes, updates and other issues will be addressed and whether there will be any costs associated with these support services. Top providers will want to ensure their tool continues to meet your needs.

When it comes to technology solutions, one size does not fit all. Taking an analytical approach to the evaluation process will help your firm avoid costly mistakes while adopting technology that makes your advisors more efficient and effective.

Mark Mersman is the Chief Marketing Officer at USA Financial, as well as one of the co-hosts of the nationally syndicated USA Financial Radio Show.

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