Aite Group, LLC investigates advisors opinions concerning technology and its importance in the selection of the firm. The report includes the survey of 201 financial advisors – an equal mix of independent Registered Investment Advisors (RIAs), registered representatives at independent broker/dealers, and captive employee brokers – and conversations with technology providers, custodians and clearing firms.
Under the present reign of hybrid approach to financial advisement the underlying technology has struggled to keep up. In fact, 72% of advisors consider technology either very important or essential in their decision to work for a given firm.
There has been little integration between brokerage and wealth-management functions to date, however; slightly more than one-third of advisors have access to a bundled technology package. Recognizing the benefits of integration, however, 64% of advisors would actually prefer a bundled application.
Advisors have definite opinions concerning which technology plays an important role in their ability to conduct business, says Adam Honore, senior analyst and co-author of this report, with Aite Group. Nearly half of advisors rank financial planning tools their most important application, while another 17% of advisors ranked customer relationship management their top application. In order for an effective platform to be created, wealth management and brokerage functions can no longer be distinct applications.
With an effective integration between brokerage and wealth management platforms, areas such as customer service, account setup, general administration, compliance and portfolio maintenance can all be reduced in the amount of time an advisor spends on each task, says Alois Pirker, senior analyst and co-author of this report, Aite Group. With a majority of advisors looking at technology as a critical driver in their selection of a firm, technology laggards risk losing high-producing employees or face a lower chance of competing for the 25% of brokers considering leaving their existing firm.
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