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Modernizing back-office technology can improve daily working life for advisors by streamlining workflows such as onboarding and financial planning.frender/iStockPhoto / Getty Images

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Raymond James Ltd. is beginning a review of its back-office technology system as it strives to serve an evolving advisor community and client base. The review is the latest technology upgrade among wealth managers eager to differentiate themselves from their competitors.

“We continue to re-invest in our business with a focus on continuous technology modernization,” says Jamie Coulter, chief executive officer at Raymond James. That includes reviewing advisors’ needs and investing in the brokerage platform to improve trade execution and post-trade systems.

The Deloitte Canada LLP-led review will place Broadridge Financial Solutions Inc.’s Dataphile-based system that Raymond James is currently using under the spotlight. Two decades after its deployment, the firm is reassessing the platform as it looks to keep up with evolving advisor and client needs.

“Digital and technology experiences are a big driver of advisor and client experience,” Mr. Coulter says.

The goal is to phase in a new foundational technology sometime next year to help sustain the company’s growth. In doing so, Raymond James could learn from Richardson Wealth Ltd., which spent 18 months upgrading its core technology, switching on the new system on Jan. 1, 2023.

Richardson Wealth had used Dataphile internally to power its book of record systems, which it had configured heavily for its purposes. The book of record is a single source of data that provides an up-to-date view of all investment positions. Richardson Wealth outsourced its clearing and settlement to Fidelity Clearing Canada ULC, which also uses Dataphile; that allowed Richardson to focus entirely on wealth management.

“The team advantage of partnering with Fidelity was to fast-track our digital enablement for the back-office tool set specifically,” says Scott Stennett, senior vice-president, head of digital strategies and advisor services at Richardson Wealth.

Generally speaking, advisors all have access to the same product shelf of equities, funds, exchange-traded funds and bonds, he says. “So, more and more, it’s the digital platform that will differentiate the experience.”

Modernizing back-office technology can improve the daily working life of advisors by offering more up-to-date information that supports faster decision-making. It can also help to make the exchange of data between applications more seamless, streamlining workflows such as onboarding and financial planning.

Mr. Coulter also points to enhanced risk-management tools. “These can help organizations such as ours automate some of the risk monitoring, supervision and management functions,” he says.

Getting advisors on board

Mr. Stennett says Richardson Wealth’s transition was one of the largest financial projects in Canada, based on assets under management (AUM), but it was not without its problems.

“Our core accounting ledger converted flawlessly, but what we underestimated was how much change management support would be required and for how long to get our teams working at a reasonable level of efficiency,” he says. “We hired change management specialists, but in the end, it wasn’t enough.”

Change management and deployment challenges make advisor acceptance testing and training even more important, he says. Catering to advisors’ different learning styles is important. Some like to read the manual, others like to watch videos, while still others prefer to learn as they use the tool.

Other technical challenges made it more difficult to gain acceptance. Back-office technology upgrades complicate matters because they’re difficult to phase in. “The conversion must be a big bang and done all at once,” Mr. Stennett adds, because of how regulatory oversight is conducted.

Another challenge was data integration. The book of record integrates with a range of other systems that rely on its data. Richardson Wealth had to convert around 250 transaction codes from its old book of record to match Fidelity’s, but they also had to be compatible with downstream tools such as Envestnet Inc.’s financial planning system that Richardson Wealth’s advisors use.

Richardson Wealth is now addressing data integration more broadly with a company-wide data transformation project. The initiative, which began as it switched on its new book of record system in January 2023, is migrating its data to a cloud-based repository that will serve as a single source of information for several digital tools.

“It takes a lot of money and complex engineering time with data scientists to build out your data infrastructure properly,” Mr. Stennett says. Had the data infrastructure been “more mature at the time of the Fidelity conversion, then I believe we would have had a much greater success story on our downstream systems, which are mostly fed by the book of record.”

The new data architecture will make it easier for advisors to draw upon information provided by multiple tools when filtering their clients. It will also automate the passing of information between tools, minimizing the manual re-keying of information.

Fluid, open information flows are also key to Raymond James, Mr. Coulter says. Based on advisor and client feedback, the firm is investing in wealth management platforms with open, application programming interface-based architecture that integrates easily with other systems, he says. “This feature reduces the cost of implementation and increases the pace of technology enhancements.”

While Richardson Wealth’s technology upgrade process has faced challenges, Mr. Stennett is happy with the results. He believes more sophisticated digital systems make the company a more compelling proposition for advisor teams. Richardson Wealth just brought an advisor team in Halifax with $500-million in AUM on board that cited its more efficient platform as a factor, he says.

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