Close up of a digital platform for investing
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I recently had the privilege of participating in a webinar hosted by Katie Keir of Investment Executive (IE), speaking alongside Matthew Latimer of the Federation of Independent Dealers.

IE has been doing a version of its Report Card series research since May 1993 — over 30 years! While the players have changed, the objectives have stayed the same: to analyze advisor sentiment and industry health.

I was especially fascinated by the Advisors’ Report Card data insights. The data showed that many elements of the average advisor’s business have changed over the past 30 years. The typical business model is different, the number of client households served has dropped, and the average assets under management has grown.

However, technology issues have persisted for those 30 years. The following two categories were consistently identified as among the top five in which advisors’ expectations weren’t satisfied by firms’ investments and efforts: technology tools & advisor desktop, and back office & administrative support. (These categories were included for many years in IE’s research among the various areas where advisors rate the quality of their firms’ support offerings and tools. In 2023, these categories were refined and updated.) Akin to the old adage about real estate, for the financial advice industry, what’s important is technology, technology, technology.

Digging a little deeper into the data, we saw that the main complaints tended to be that firm systems were not well integrated, and that key tools and portals that help advisors connect with clients had not been updated.

The finding is not all that surprising. Although technology is increasingly key to meeting both our regulatory obligations and client and advisor expectations, it’s a moving target. Technologies are regularly upended, with a seemingly shiny (and expensive) new technology bauble around every corner. And any technology choices we make need to somehow fit into our complex legacy technologies and systems.

In this context, it’s often difficult to know how to make meaningful headway. Here are a few suggestions for advisors, firms and technology providers to consider.

For advisors

  • Understand that technology requires a significant investment, both up front and ongoing. When your firm asks you what cost you are prepared to bear (directly or indirectly), carefully consider your priorities.
  • Don’t be afraid of technology taking over your job. Leverage the tools to the greatest extent possible, and free yourself up to spend more time talking to (and especially listening to) your clients.
  • Keep talking to your firm about technology initiatives. Provide specific examples of technology improvements you recommend to improve either or both the advisor and client experience.
  • Encourage your team to invest the time in taking additional training on new technology. We too often fail to harness the power of the technology or unlock its real time-saving potential.

For firms

  • Whenever making changes to the technology, be sure to review the end-to-end user experience (advisor and client), not just the new pieces. Does the new technology fit seamlessly, or does it introduce duplication of information or process? Does the language flow consistently?

If the adoption of the new technology, whether to meet a regulatory requirement, to mitigate risk or to improve user experience, introduces complexity or inconsistency, the job is not done.

  • Advisors understand that firms have limited resources. They also appreciate being asked for their input. In return, they expect clear communication and transparency around which technology projects were chosen and which were not — and why. Advisors would also appreciate a roadmap that shows when their preferred project or the pain point they identified will be considered.
  • Reconsider your approach to training and how to measure adoption (see my related tip for technology providers, below).
  • This is a big one: Every technology improvement does not need to be a big bang. Always be on the lookout for low-hanging fruit. Sometimes, very modest clarifications or changes to the technology flow can lead to significant improvements, including time savings, error reduction and improved client conversations.

Innovation is not one-and-done. Continue to iterate and improve.

For technology providers

  • You have really stepped up when it comes to listening to your clients, but there are often a lot of different ideas on the table. Be sure to understand the pain points that clients face, and then apply a user lens to solving the issue. And don’t stop asking and listening.
  • Reconsider your approach to training. Too often, client firms take advantage of only the beginner “how-to” training on offer. This allows users to adopt the strictly necessary parts of the new technology but typically leaves unknown many of its features and therefore true power.

Instead, proactively consider what training is necessary to drive both awareness and adoption of the full features and power of your technology platform. Provide staggered training so that, once users have mastered the basics, they will automatically be enrolled in the next level that introduces the many wonderful features that will otherwise go hidden and unused.

This approach should not be a nice-to-have; it will really showcase your technology solution and provide growth opportunities.

  • Take full advantage of principles-based regulation. Many of the regulations adopted by Canadian regulators use this approach, which focuses on the desired outcome while providing significant flexibility on how to achieve it. This allows you to consider and incorporate things that matter to your client firms, such as improving the client and advisor experience.

Susan Silma is a lawyer and former regulator with a deep understanding of the client perspective. She is passionate about simplifying and humanizing the client experience in financial services, while navigating the complex regulatory environment and promoting compliance.