Celent, a Boston-based financial research and consulting firm, publishes Ranking the Vendors of Financial Planning Technology 2008 to evaluate the role of the financial planning industry in the wealth management arena.
Celent expects future extended collaboration between financial planning vendors and broader wealth management platforms. The report includes detailed profile of vendors in the financial planning market segment. The comparisons and rankings touch NorthStar, PIEtech, PlanPlus, SunGard, and Thomson Reuters, AdviceAmerica, Advisor Software, CGI, EISI, Impact Technologies, Money Tree.
In the “Advanced Technology” category higher marks received SunGard, AdviceAmerica, and EISI Naviplan, followed by EISI Profiles and NorthStar. In terms of number of clients, PIEtech is the winner, with the largest client base among the analyzed vendors (93 clients), followed by EISI Naviplan, Money Tree, and SunGard. In the last category, “Depth of Client Services,” the top quartile is dominated by SunGard, PIEtech, and EISI, followed closely by NorthStar and AdviceAmerica.
According to Celent echo of global financial crisis will bring following effects on how wealth management firms buy technology in a number of ways: 1) a modular approach will be followed, adding functionalities as necessary but with open architecture, 2) return on investment will be imperative in backing up the technology expense, and 3) firms will be after those implementations that provide both tactical and strategic IT benefits.
Also report indicates some key changes in the financial planning technology space: 1) cooling off in vendor consolidation, 2) continued expansion of product offerings, 3) different planning levels under one roof, 4) strategic partnerships with data integrators, 5) support for goal-based and cash-flow based planning, 6) emphasis on retirement income distribution planning, 7) development of client facing applications, and 8) emerging demand for more easy-to-use and transparent software.
Within the “Breadth of Functionality” category, SunGard and PIEtech receive the highest score, followed closely by EISI Naviplan and AdviceAmerica. Other applications ranked well in this category, including Thomson Reuters and PlanPlus. CGI and Money Tree ranked lower in terms of overall functionalities, however, CGI’s strength lies in providing advanced asset allocation and strong analytics, while Money Tree covers a wide spectrum of financial planning capabilities. None of the applications was the best in all aspects of financial planning software.
Considerable emphasis has been placed on communicating with clients more frequently to review their financial situations, confirm the wisdom of their asset allocation and current holdings, and convince them to get back into the market, says Isabella Fonseca, senior analyst and author of the report, Celent. This is when financial planning systems come into the picture as part of the solution.”
L.D.