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The Integration Puzzle

As advisory firms continue to confront the challenges of technology integration there are steps they can take to help mitigate them.

I love a good puzzle. 

There's something satisfying about sorting the pieces and steadily assembling the image bit by bit. 

Puzzles require patience, organization, and strategy.

The same could be said for technology integration. When done thoughtfully, integrations connect systems and data to form a unified whole. But without care, it becomes a frustrating mess.

Defining Integration

Having had the opportunity to lead a technology company whose key value proposition hinged on creating automation across processes based on deep integrations, I’ve seen both the good and the challenging with integrations in our business. 

To start, let's clarify what integration means. 

For many firms, integration means pulling data, all data, from System A into System B. But some tech companies use "integration" as a buzzword when all they offer is single sign-on (the ability to seamlessly login to System B via System A). 

This discrepancy sets unrealistic expectations.

True integration goes beyond single sign-on by syncing data and actions across platforms. When executed well, integrations provide immense value. But they require diligence and coordination, like assembling a puzzle.

Common Integration Pitfalls

In my experience helping firms benefit from integration and automation we encountered several roadblocks time and again:

Resistance to Change

Firms often want new technology to bend to current processes, rather than optimizing processes to leverage the tech's capabilities. This is a normal bias as humans are not wired to change. Humans tend to believe that the way we do things works. And despite the prospect of a better way, we don’t know that way, thus we are weary of it. So, we default to wanting to keep our ways the exact same as we have done it forever. 

Data Inconsistency

Despite the advancements of AI and large language models, the ability to read people's minds has not been developed. When advisors use CRMs and inputs inconsistently, integrations fail to mesh. At Benjamin, a significant challenge our clients and prospects faced was maintaining up-to-date, active connections between external accounts and their planning software. This issue, prevalent in financial services, stems from a lack of standardized processes for account integration. Banks each have unique APIs and authentication methods, forcing aggregation platforms like Plaid and Yodlee to tailor their solutions for each bank individually, rather than connecting through a unified system. This results in considerable management overhead. For advisors this leads to gaps in financial planning data due to integration issues. Europe has addressed this problem by standardizing bank APIs, fostering innovation and smoother data integration from financial institutions. The U.S., with its larger and more diverse banking system, including numerous credit unions and local banks, has yet to adopt such a standardization, hindering similar progress.

“Curse of Knowledge”

After going through the process for years, we take basic steps for granted. I always liken this to breaking down, specifically, the steps of making a PB&J sandwich. When I ask a group to write down the steps, each person has different answers. Each response is missing the basic steps like untying the bread and opening the drawer (for the knife to spread the jelly and peanut butter). Although these steps seem menial, they are necessary to know and document. Why? Because knowing each step helps to understand where efficiencies can be gained when executing the process. Despite them being “known” steps, these steps are necessary to complete the action of building a PB&J. And thus documenting them helps to identify what to automate.

No Designated Resource Focused on Technology Ecosystem - Too often, the role of managing, monitoring and implementing technologies falls to someone as a secondary or tertiary task. It is not their most important focus. And the task was certainly not a “revenue” generating task. With no single owner, integration falls through the cracks among siloed teams. 

Strategies to Overcome the Challenges

Based on these common pitfalls, here are some ideas to enable integration success:

Change Leadership

Teams resist changing processes and want technology to conform to them. This is natural as people gravitate toward the familiar. 

Executives should spearhead an organizational culture shift that values adaptation, transparency, and learning. Rather than enforcing dated processes, leadership should role model exploring emerging solutions. They must involve teams in decision-making and allow failure en route to efficiency. Rewards and promotions should center flexibility – welcoming new tools that enhance best practices rather than forcing technology into past comfort zones. Leaders with vision inspire change, while lack thereof brews resistance.

Information Governance & Controls

Inconsistent data undermines integration capabilities. Rapid growth leaves little time to optimize systems and siloed teams use tools differently.

Teams should look to appoint an expert to overhaul information flows, establishing standardized data inputs, tags, formats, and system workflows. A committee spanning departments can govern guidelines as new tools enter the ecosystem. Required fields and drop-downs limit ad-hoc inputs, supporting consistency as business scales.

Map it Out

It is natural that we overlook simple sub-steps that technology could handle. Experts in certain roles suffer the "curse of knowledge,” taking the basics for granted. Leadership should guide teams in meticulously mapping workflows – detailing what data gets gathered, input, and shared at each phase. Noting which systems touch each process stage clarifies where to establish integration points to relax duplicative manual work.

When working with teams, we would work to break down their process into a flow chart to see each individual step, the information needed within the steps and the technologies we would interact with. You can see a simplified example here

Assign Ownership 

If integration is no one's primary responsibility, it will fall through the cracks. This role is not a core revenue-generating role, thus leaders tend to deprioritize it.

Overcome this challenge by hiring or developing a dedicated Director of Technology. Let them thoroughly map current infrastructure, build expertise across all tools, liaise between stakeholders, guide benefit realization, and serve as an evangelist through training. Treat integration as a critical building block. The return is exponential. 

With deliberate strategy, the puzzle pieces click together. Integration streamlines systems and information flow. But it requires diligence. Like a challenging puzzle, teams can enjoy the satisfaction of steadily connecting those pieces.

Matt Reiner is managing partner of Capital Investment Advisors.

TAGS: WealthStack
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