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There’s growing interest in using automated technology to manage data and workflows.JPG

There’s growing interest in using automated technology to manage data and workflows

While about 40% of respondents have made the move to automated technology to manage data, another 44% are considering the shift, especially among larger firms.

On average, four in 10 respondents (41%) use automated technology to manage alternatives document and data workflows. Advisors who currently use technology in alternatives management are most likely to use performance reporting (68%) and portfolio management technologies (64%). Fewer use technology for document collection and management (39%), internal systems (32%) and data management (32%). 

Nearly half (46%) of respondents use a proprietary system for performance reporting. Perhaps due to greater access to resources and scale, larger advisors are more likely to have a proprietary system, including 49% of those with $1 billion to $5 billion in AUM and 58% of those with $5 billion or more in AUM

In addition, 44% of advisors are considering making a move to automated systems. While larger firms tend to have more resources to devote to managing processes manually, advisors with $1 billion or more in AUM are more likely to use automated technology. And the more assets they hold under management, the more likely this use becomes. While 47% of advisors with $1 billion to $5 billion in AUM are likely to use automated technology, that number rises 55% for advisors with $5 billion dollars or more in AUM.

Of the 15% of respondents who said they had no plans to switch to automated technologies, about one in five were firms with less than $10 billion in AUM, despite a potential relative lack of in-house resources.  Only one in 10 advisors with $10 billion to $25 billion in AUM have no plans to switch, and that number falls to just 6% of advisors with $25 billion or more.

“We didn’t want to be in the business of handling data constantly,” says Kolker. The firm, a Canoe customer, needed an automated solution that extracts data from PDF documents, unifies the data treatment and reduces the number of times analysts have to touch the data. “Canoe is a huge time saver,” says Kolker. “It takes multiple steps off our hands, making the whole process more efficient.”

When considering ideal solutions for automated technologies, other advisors are looking for a comprehensive and turnkey solution that’s easy-to-use, and automatically gathers documents and data from various sources and uploads it into existing portfolio and reporting platforms.

“Overall on a relative basis, advisors are dealing with a lot of operational pressures,” says Loughrey. “To increase efficiency, differentiate themselves, and combat fee compression,      advisors must adopt scalable technologies that integrate with each other. Without a streamlined dataflow, advisors may not only experience diminishing returns, but also be unable to compete with larger wealth management firms.”