How advisor efficiency accelerates growth in wealth management

The long-standing reputation of the wealth management industry is that it provides their clients with high touch, tailored financial advice and services based on old-fashioned values. This client-focused approach has led firms to intuitive and personalized marketing platforms, deep risk profiling, digitally enabled advice, and next-best-action solutions, which have dramatically reduced costs and made financial advisors more efficient and productive.

The ability to improve the client experience – at scale – has been the centerpiece of technology investments over the past few years. And firms continue to make investments in personalization technology, as fintechs and non-banking firms compete for market share. Wealth firms are devoting greater resources toward enhancing advisor efficiency and the client journey. Firms are also viewing the front office as a competitive differentiator, driving many to digitize their front office while outsourcing back- and middle-office functions to achieve lower costs.

Financial advisors are spending too much time on back-office tasks

There is no question that digitizing to elevate the customer and financial advisor experience has paid dividends for wealth management firms. Unfortunately, though, the typical financial advisor still spends 60% to 70% of their time on non-advisory activities. This means that only 30% to 40% of their time is devoted to direct client activity, and less than half of that is in the actual process of meeting with clients.

In fact, a typical financial advisor will spend more time on back-office tasks than all their client and prospecting meeting time combined. As described in an article in Kitces, the reality is that financial advisors don’t only meet with clients to offer them financial advice. They also work to analyze a client’s financial situation beforehand to give the best advice, meet with prospective or new clients to earn the right to give them that advice, and help all their clients implement the advice successfully. Not to mention running the “advice business” -- the research, planning, and meetings --- built around the advisor as well.

So, why hasn’t technology helped lighten the workload? What’s happening behind the scenes to cause this problem?

For one, there are a plethora of disconnected technologies and processes that cause execution problems which, in many cases, results in an intervention by the advisor. Firms spend millions of dollars every year supporting and attempting to modernize these legacy platforms and home-grown applications. There are also too many manual processes in place. Some firms still have too much paper in their environment, using spreadsheets and requiring wet signatures rather than digitizing the experience. This causes delays in opening an account that the financial advisor spent weeks to get. It results in creating financial plans that take weeks to create, rather than hours. Not only is this a poor customer experience, but many of these operational issues become a distraction and a time-drain on the advisor.

By modernizing and digitizing processes, firms can increase advisor efficiency

Because of declining fees due to increased competition, low fee products, and performance-based fee models, wealth firms are recognizing the need to enhance their financial advisors’ abilities to drive net-new assets under management to improve revenue and profitability. And because expense management remains a top priority, this can only be achieved by automating many of the middle and back-office functions, which too often involve the financial advisor. Wealth firms are now devoting greater resources toward enhancing advisor efficiency.

Many firms have identified this issue and are adopting widely available robust tools and technologies to help automate, or at a minimum streamline, administrative tasks associated with managing client accounts. Adoption of these tools will improve execution and relieve some of the pressure on the financial advisor.

When considering a back-office’s ability to create efficiencies within an organization, it’s important to look toward traditional bottlenecks in workflows. Common bottlenecks in wealth management are building and delivering proposals, onboarding new clients, and submitting work requests.

Wealth management firms need dynamic platforms to manage tasks more effectively

In his article, “Standing Out From The Crowd – How Technology Impacts A Firm’s Ability to Achieve Success,” author Frank LaRosa, President of Elite Consulting Partners, calls out that technology is one of the key differentiators among financial services firms. He also explains how dynamic platforms that have the ability to cross-manage across multiple advisory tasks, including record keeping, marketing, compliance, and operations, afford advisors the ability to more efficiently allocate their time, lead their business, and oversee their client assets. The technology must also include tools to assist advisors in successfully branding, marketing, and growing their practice within the supportive construct of the overall firm culture. LaRosa states:

"One of the best industry examples of this type of thought-leadership when it comes to engaging and supporting advisors through technology can be seen in the technology solutions offered by Raymond James. As an active and vocal proponent of technology as an essential growth factor for operational success, Raymond James invests heavily in technology in order to provide cutting-edge solutions, which streamline an advisor’s operational tasks while in tandem bolstering overall firm success through efficient client asset management. For instance, in 2017 alone Raymond James invested $250 million in their in-house technology solutions. Further, they have employed a team of more than 1,000 IT Solutions professionals whose responsibility is to ensure the consistency and functionality of the Raymond James technology platforms while keeping an eye toward further innovation. The results of these efforts have paid off, as Raymond James Chairman and CEO Paul Reilly recently stated conveying the company’s technology has created a scalability through which it is poised to support its growing number of advisors and client assets."

How unified platforms like Pega improve the client and advisor experience

Technology should help your advisors focus on their clients and allocate a larger portion of their time to strategic growth planning. Pega, for example, differentiates our platform by providing comprehensive services encompassing operations, IT and compliance administrative support. We provide the solutions to help wealth firms drive and improve business outcomes, automating core operational functionalities with a focus on workflow improvements. Specifically, Pega:

• Optimizes customer service processes across all channels without requiring replacement of existing front and back-end systems using an open, scalable architecture that focuses on customer journeys and outcomes – not channels and systems. Our intelligent routing gives quick access to advisors who want or need to speak with clients and provides guided processing to ensure advisors can complete client requests expeditiously. The platform also supports self-service for routine client requests, which not only speed up the process but will allow financial advisors to spend more time focused on higher value tasks.


• Uses robotic process automation (RPA) to access or update information across multiple systems and applications, reducing routine efforts by agents. 


• Uses AI and RPA to onboard clients faster by reducing manual processes with transparency and orchestration across channels. Our low code platform may also serve as a viable alternative and complementary option, utilizing case management to ensure workflows are completed with maximum efficiency.

The wealth management industry has made significant advancements in delivering investment advice and empowering the investor. As advisors seek to accelerate their growth in acquiring net new assets under management, firms must focus on modernizing the experience for clients and the financial advisors who serve them. It is critical that firms enable greater financial advisor efficiency so clients and advisors get the flawless execution they deserve.