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Advisors should think about each technology product as part of a larger whole so that information can flow freely between all the tools.

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Advisors who embrace financial technology tend to be more successful in attracting clients and their assets, but an abundance of choice is making it difficult for others to incorporate these new tools into their practices, according to a recent report from Cerulli Associates Inc.

The Boston-based research and consulting firm analyzed how advisors leverage technology and determined them to be light, medium, or heavy adopters based on their use of these tools across various categories and how often they upgrade their products.

Although only 36 per cent of advisors were considered to be heavy adopters, they control 46 per cent of total advisor-managed assets, while the 64 per cent of advisors who were light or medium adopters of technology manage 54 per cent of client assets. On average, heavy adopters of technology manage US$239-million in client assets whereas light adopters managed just US$106-million. So, why aren’t more advisors tooling up?

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“It’s not for a lack of choice,” says Marina Shtyrkov, senior analyst at Cerulli Associates. “It’s more about understanding the education and the guidance around how to use the technology that’s available.”

Taking advantage of dealer technology suites

Advisors have a wide range of technology options to choose from when managing their practices. With so much complexity, it’s no wonder that some shy away from putting together the perfect system.

Some dealers help advisors by offering preselected technology options, says Joel Bruckenstein, producer of the annual T3 Advisor conference and an expert on technology for advisors in Hollywood, Fla.

“If you work with a bigger firm, they have technology offices that evaluate technology,” he adds. “They do a pretty good job of making decisions and putting platforms together.”

For example, Winnipeg-based IG Wealth Management picked online software from different vendors to create a standard software portfolio for its network of 3,500 advisors. Those services include Microsoft Corp.’s OneDrive for online storage and Salesforce.com Inc.’s customer relationship management (CRM) tool.

IG Wealth Management’s advisors access these and other services through a single online web page called the Advisor Portal, says Brent Allen, senior vice-president, financial services distribution, at the firm.

“Advisor Portal is your hub. We only want you to visit one spot in the morning to look for things,” he says.

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Guidelines for choosing technology

But while advisors who work with such a large firm have the technology situation figured out, others need to make their own technology choices. It takes research and planning to build a cohesive technology strategy, Ms. Shtyrkov says.

“Advisors must weigh the benefits of the technology with the associated cost to make the decision that’s best for them and their practices,” she says.

She divides advisor technology into two broad categories: productivity software that’s useful for any type of professional and industry-specific tools that focus on specific tasks such as financial planning and investment management.

Whether advisors are building a technology portfolio from scratch or fleshing out their firm’s offering, they should look closely at what they already have to see if there “are there features or functionalities of the technology you have that you may be unaware of or maybe not using efficiently,” Ms. Shtyrkov says.

If those features or functionalities aren’t there, advisors should consider add-ons that might be available for those existing tools.

Furthermore, advisors should think about each technology product as part of a larger whole, says Jason Pereira, partner and senior financial consultant at Toronto-based Woodgate Financial Inc., a financial planning firm that’s part of IPC Securities Corp. He adds that integrating products is vital so that information can flow freely between them.

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“I should never have to fill out a client’s name, social insurance number, or address, ever, anywhere, once it has been captured,” he says.

Many productivity tools already offer built-in integrations with a wide variety of systems. For example, Gmail and Salesforce CRM can exchange data with one another. Mr. Pereira uses an online scheduling system called Calendly that integrates with both of those services. He says even non-technically-savvy advisors can set up these data exchanges in just a few clicks.

Other software applications and cloud services don’t offer such easy integrations. In those cases, connecting them together might take some more technical knowledge. Few advisors will have those skills, but Mr. Pereira says that it’s worth hiring a technical consultant to set up those integrations.

“Even if you can’t integrate everything, there are enough integration opportunities that you can save a tremendous amount of time,” he says.

Mr. Pereira implemented his online booking system and integrated it with his other tools after an associate at his practice revealed that she spent 60 per cent of her time booking and rebooking meetings. Now, those tasks take up just 10 per cent of her time.

“The learning curve is not as steep as you think it is, and there are immense productivity gains,” he says.

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