‘It’s no longer a matter of man versus machine, but rather man with machine versus man without machine.’
Netwealth CEO Matt Heine, speaking at the the Adviser Innovation’s Melbourne Summit, has just returned from a fact-finding mission to Silicon Valley, San Francisco. His findings? Although the possibilities afforded to advisers by the fintech boom continue to expand exponentially and demand continues to grow in turn, many advisers are still a little intimidated by the prospect of committing to new technology or overhauling their existing systems and processes.
According to the AdviceTech research report prepared by Netwealth, while only 11 percent of advisers surveyed believed that technology is pervasive in the industry, there appears to be an overwhelming desire among advisers to be more engaged with their clients using, among others, new CRM, SMA and marketing automation technology. The main reason advisers aren’t showing more initiative in ramping up their tech, Matt argues, is time.
The rigours of day to day business are obviously very time consuming, but Matt proffers a different approach to management. In his view, there are three horizons. The first horizon is your day to day: compliance, invoicing, meeting the needs of your existing client base. This horizon should constitute 70% of your business strategy.
Then there is the second horizon of entrepreneurial decision-making. This is where you are thinking about technology that is already on your radar: live chat functionality for your website, SMA’s, SMSF and so on. To this horizon, Matt suggests devoting 20% of your time.
Finally, there is the third, aspirant horizon. This covers the moon-shot developments that, although rare in today’s climate, will be ubiquitous in 10-15 years’ time; things like blockchain and AI. 10% of your time allotted to business strategy, Matt suggests, should be directed at fostering a relationship with these burgeoning innovations.
This may sound like a lot of precious time to be spending on blue sky thinking but, no matter how much energy you plan on dedicating to it, there are plenty of tools at your disposal which can make developing your tech a lot easier.
For one, you can save yourself a lot of time and money by consulting your peers first. Adrian Patty of AP Financial Solutions extols the virtues of XY Adviser, an online community for advisers in the know and those eager to learn more about how technology can better serve their practice and their clients. It’s free to join, so if you’re sceptical of a new piece of software it’s well worth running it by the brain’s trust first.
And it’s not just your peers that are worth relying on; there is a wealth of material on the internet dedicated to cost-benefit analysis and product comparisons. Every business is different, and Adrian implores advisers to do their research and work out the best applications for their circumstances and client base. Similarly, there is no ‘catch-all’ app: using technology well is about creating an ecosystem that best suits your needs.
If you’re still struggling, or you don’t where to begin, people like Peita Diamantidis of Caboodle FS offer services for advisers who are keen to modernise their business. But while it might sound nice to sit back and relax now the cavalry has arrived, Peita warns that advisers should remain vigilant for the full lifespan of all new projects; you may have outsourced a lot of the technological aspects of your business, but your contractors still need a foreman. And, at the end of the day, you know your business best.
While you may not be racing to integrate virtual reality headsets into your business, the Adviser Innovation Summit demonstrated that there is a suite of apps and software to suit every level of tech savviness. As Peita urged at the conclusion of her presentation, being nimble and adaptive to change in the industry is the single biggest advantage small businesses have over big businesses. So, if there is something you don’t need to be doing, why wait? See if you can get technology to do it for you.