Back-office processing and compliance approval keep the heart of a business pumping.
Operational efficiencies in these areas enable your business to do what it does best better, while also growing in a scalable manner. So a key question your firm needs to answer is: Will the technology solution for processing and compliance be a platform system or a point system?
“Point” solutions are niche solutions developed to solve small yet critical pieces of an advisor’s complex technology puzzle, and are increasingly popular in today’s technology-driven cloud environments. They are designed for a single activity or process, such as disclosures or recording, and are not integrated with other applications as part of a broader “platform” solution, in which multiple technology programs share data and work together to create operational efficiencies.
A CRM solution, for example, is a point solution designed specifically for the financial services industry and tailored to meet an individual firm’s needs, and can be a useful tool for a smaller RIA that relies on a legacy system and can’t afford a total technology overhaul.
Point solutions can turbocharge a practice over the short term, but because they are standalone applications, they may not meet a practice’s long-term needs. Point solutions often don’t share data or keep track of workflow processes, which can lead to data and reporting errors. Many point solutions are also not readily scalable, which can make it difficult for a firm’s other systems to keep pace with practice growth. As a result, point solutions tend to create more, not less, administrative work for advisors, broker/dealers and RIAs over the long term.
A platform solution consists of multiple technology applications that are fully integrated, facilitating the seamless flow of data back and forth across a unified system. Many of today’s platform solutions are also cloud-based, giving advisors a single, secure place to store their client data. The time that integrated, cloud-based platform solutions save advisors often leads to scalable growth.
In addition, while point solutions are standalone, their platform counterparts are built to accommodate and integrate more applications to further streamline a practice as it grows.
Advisors shouldn’t just think of platform solution providers as technology vendors—they are partners who help to optimize practices using their systems. The mark of a good platform solution provider is that they regularly roll out technology updates to enhance their offerings, and work with the practices they serve to ensure that advisors are familiar with the enhancements. Check to see that a prospective provider offers API software development kits to help practices implement and customize technology updates.
Also, be sure to ask a prospective partner about the number of successful integration projects they’ve completed, especially for financial services firms like yours. Make sure your platform provider is highly experienced in building integrations for and with clearinghouses, mutual fund companies, as well as CRM, advertising review, money management and portfolio management applications.
Your platform solution should be able to integrate and share data from multiple sources, including faxes and emails, using a workflow engine to code and route the data in real time and then move it to where it is needed.
Tom Embrogno is a principal of Docupace Technologies. Previously, he brought to market the first cloud-based SEC/FINRA-compliant supervisory and storage system that satisfies SEC rules 17a3 and 17a4, and has a background in information technology, cybersecurity and investment banking.