TowerGroup documents the industry's march toward mobile technology.

The concept of "upward mobility" is taking on a new meaning, suggests a report by TowerGroup, "Mobilizing the Financial Services Enterprise: Business Mobility Gets Unwired." Factors compelling a growing number of financial services firms to "go mobile" are documented in the September 2004 report by TowerGroup Senior Analyst Ed Kountz, who notes four trends emerging in the financial services industry:

    With the improvement in, and falling costs of, mobile devices, networks and applications, the industry is renewing its attention to enterprise mobility projects;
    Always-on e-mail remains the cornerstone of enterprise mobility, but new applications are being tailored to a variety of industry "vertical markets";
    The industry is starting to pay attention to and invest in the mobility possibilities for applications such as "executive alerts," mortgage information and institutional mutual fund sales;
    When considering how to deploy mobile applications, the industry must choose the right set of partners, technologies and users if it wants a rapid and strong return on investment.

The TowerGroup report refers to enterprise mobility, but has implications for all sizes of financial services firms. "When we speak of enterprises," says Kountz, "we are referring less to the differences between, say, a Merrill Lynch and a Linsco Private Ledger (LPL), then we are a very large enterprise versus a very small shop-one with five or fewer employees."

All firms participate in the mobility movement, according to Kountz. While enterprise firms with large technology budgets are spurring initial mobility advances, these efforts are met in the "lower end of the middle" by smaller firms looking for tech advances to keep a competitive edge.

At all levels, the financial services industry is adopting mobility applications to improve client service and advisor efficiency, although motivations may be different. The goal of many larger enterprises, suggests the report, is to deploy into the hands of highly mobile employees data that is traditionally centralized in enterprise databases, allowing them to customize solutions for clients who might otherwise receive homogenized enterprise solutions.

Smaller firms taking a bottom-up approach to mobile technology may have a different goal in mind. "If the value of an independent RIA relationship is in its high-touch model, the independent RIA is clearly not going to want to replace that service model with something electronic," says Kountz. "The need for remote contact with the client will be less if you're a small business proprietor." All in all, the smaller firms tend not to be early adopters of mobile technology, since they have less of a need and less of a budget for it.

Yet, Kountz agrees that a trend among some small firms may put a new face on that need. Two trends not addressed in the report make that true: the need of smaller firms to retain key employees who leave its geographic base, and the changing lifestyle desires of small-firm owners. "We've seen the RIA space, in part, filled by people with backgrounds in other parts of the industry who are looking for more flexibility, more time for other interests. Mobility can enable that," says Kountz.

"I would stress that five years ago [these advisors] might have had a cell phone and a desktop PC; now there are a huge number of variances in that spectrum. They might be using cell phones for text messaging, PDAs with applications synced into their e-mail accounts, or wireless laptops," says Kountz. "The range of what you can do is increasing significantly. My perspective is that in a hypercompetitive industry [such as financial services], anything you do of this nature is a good thing, especially as prices come down."

Therefore key employees moving away from the RIA firm when spouses are relocated, or small-firm owners wanting to work part of the year in more remote and relaxing locations, are each aided by mobile technology.

The success of the RIM Blackberry is the foundation for the deployment of many newer enterprise applications, the report argues. A wireless PDA device developed in the mid-1990s by Research in Motion, a Canadian company, the Blackberry is the prototype for most handheld, wireless, always-on e-mail tools used today.

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