More players and customized solutions mean better alternatives for advisors.

CRM is an acronym for:
a. Copy-ready media
b. Central repository medium
c. Customer rating module
d. Customer relationship management
e. None of the above

A good CRM system helps you:
a. Track changes in your clients' addresses
b. Manage client communications
c. Document workflow of projects in your firm
d. All of the above
e. None of the above

A popular CRM system is called:
b. SalesMetrix
c. Junction
e. All of the above

As an independent advisor, the only CRM you should consider using is:
a. Made by Microsoft
b. Excel-based
c. A desktop application
d. None of the above
e. All of the above

    "D" is the answer to all four questions. And if you got any of the answers wrong, then you want to read this story.

I've learned from running my own business that a customer relationship management system is essential. If you are not using a CRM system to record notes about every client contact, to track workflow and to store key data about your clients, you probably won't ever be a great advisory firm.

If your firm is not habitually recording notes about every conversation with clients and vendors, you're missing opportunities. Even most of your conversations with clients contain little or no substantive information about wealth management and last only a few minutes, making a habit of taking notes about seemingly mundane conversations is essential. In fact, it's likely to transform your practice.

Keeping anecdotes like, "Charlie and I spoke and he told me his daughter is leaving to study abroad," or "Victoria told me she was buying new living room furniture"- will help you stay in touch with clients' lives. Six months hence, when Charlie calls your office, you can pull up your notes and ask, "Charlie, is your daughter still abroad?" When you get an e-mail from Victoria about a fund position, you can preface your reply by asking, "So how did the living room come out?" That's big.

Is it a little contrived? Yes, but you may not talk to a client more than once a quarter or every six months. You can't remember details of every conversation. Clients, prospects-everyone appreciates it when you remember what's going on in their lives. It shows you care. So recording everything-even the briefest and seemingly most trivial of conversations- in a CRM system is wise.

And taking notes about all substantive conversations with clients can also keep you out of trouble. If you are a habitual note taker, you can tell clients when they're wrong. When a client has been dragging his heels for months in getting information to complete his financial plan, for instance, being able to send him a note saying that you contacted him on June 10, June 31, July 7, July 30, August 7, August 21, September 8 and September 30 is likely to put your effort on his behalf in perspective. It's inarguable that you have earned your fee and that he is falling down on his end of the deal. It's a lot more effective than just calling a client over and over again to cajole information out of him. Plus, such notes can serve to lessen liability exposure. A detailed history showing your actions on behalf of a client is a pretty strong defense.

Moreover, such notes create an institutional memory that survives the loss of any employee. When you lose a staffer, even someone who occupies a central position in your organization, a successor has a much easier time stepping in when you make available to him or her detailed notes about your company's interactions with every client. Your firm is worth more in a sale when you provide a buyer with a history of every client relationship and can hand off your procedures for running your business.

Good CRM software allows you to do a lot more than take notes about your clients. It allows you to track progress on projects. It organizes the activities of multiple employees working as a team. For instance, you probably run through the same series of steps every time a prospect contacts your firm. The steps in your "prospect process" might look something like this:

Step 1: Mail the prospect your brochure and financial planning questionnaire.

Step 2: Place the prospect on our client newsletter and e-mail newsletter distribution list.

Step 3: Call to schedule a meeting and ask the prospect to prepare his financial data in preparation for your meeting.

Step 4: Call the prospect a day before the meeting to confirm the appointment.

Step 5: Meet with the prospect.

Step 6: Promote the prospect into a new client and begin the new-client process or make a follow-up phone call two days from now to close the prospect.

Step 7: Make a follow-up phone call if no decision has been made.

Step 8: Make a second follow-up phone call if no decision has been made.

Step 9: Make a third follow-up phone call if no decision has been made.

Step 10: Send the prospect a letter thanking him for contacting you and asking him to contact you again when he is ready to move forward.

Step 11: Contact the prospect again six months after sending the thank-you letter.

If you've never dissected your firm's processes, then it could come as a surprise to you that this process, while on its face seeming to be a simple one-two-three step activity, is actually a complicated piece of choreography. Also, consider how something as simple and routine as closing a prospect can be transformed into a strategically executed campaign. And if you do not currently have a structured process for handling prospects, imagine how creating an 11-step process for courting new prospects is likely to improve your chances of converting prospects into clients. You might double the number of leads that you're closing. Now imagine the transformation your firm would experience if you created strategic systems for handling all of your operational processes and committed them to a CRM system. Your firm's efficiency could improve dramatically.

Which brings us to the question: Which CRM system is best for financial advisors? Two of the leading programs for several years among fee-based and fee-only wealth managers have been desktop systems, Junxure and ProTracker Advantage Both were created by successful financial advisors whose in-house technology teams were spun off to become their own companies serving hundreds of advisory firms.

ProTracker was developed in 1995 by Warren Mackensen, a planner in New Hampshire who has long been active in the National Association of Personal Financial Advisors (NAPFA). Junxure was developed a couple of years later by Greg Friedman, a planner in Novato, Calif., who teamed up with Ken Golding, a programmer. By the late 1990s, Mackensen attracted a large following of NAPFA members and was for a short time the runaway leader in creating a CRM system dedicated to financial planners. But in recent years, Friedman and Golding have lured away numerous ProTracker clients, and Junxure has innovated with a client document storage system and other features. These two programs are priced similarly and have been favored by many of the nation's best-known wealth management firms. However, a new CRM system is now available, and some very large and successful firms are adopting it.

While Junxure and ProTracker remain great CRM solutions for many firms, and while the planners running those firms are friends of mine, I am obligated as a reporter to tell you about and the work being done to customize this powerful CRM platform for advisors by Kim Moulton of Moulton Strategic Partners

Moulton has been a database architect, programmer and application development project manager for over 20 years. She owns a small consulting firm in Flower Mound, Texas that helps financial advisors implement a range of CRM systems. She also helps advisors install document management systems to create paperless offices.

Among the 50 wealth management firms Moulton has worked with over the past couple of years are Richie Lee of Lee Financial in Dallas; Dave Foster of Foster & Motley in Cincinnati; Michael Leonetti of Leonetti & Associates in Buffalo Grove, Ill.; Karen and Lew Altfest of Altfest & Company in New York; Gary Greenbaum of Greenbaum and Orecchio in Old Tappan, N.J.; Dick Bellmer of Deerfield Financial Advisors in Indianapolis; and Cheryl Holland of Abacus Planning Group in Columbia, S.C.

These are successful and respected firms, whose principals all have some gray hair, and they granted Moulton permission to use their names in this story. That's significant because implementing technology systems at these firms is a messy business. Moulton had to get into nitty-gritty details about their processes. Getting through engagements with demanding advisors such as these and then getting their endorsement is a notable achievement.

Moulton works on a fee basis and says she does not care what CRM product her clients buy. She helps them implement, a Web-based program, SalesLogix, a locally run application, Seybold, and others. She charges $200 an hour for her own time in consulting on implementation of these systems and $60 to $165 per hour for consulting by her staff and team of contractors.

She has developed one product of her own, called XLR8, a customized version of that contains most of the features needed by a typical advisory firm. And 20 of the 25 implementations she has done over the past two years have been of XLR8. "I don't care which application they choose as long as I can deliver what is required on time and on budget," she says.

Moulton says she prefers working with applications that are not geared specifically to advisors-such as and SalesLogix-because these applications are superior at the core functions of CRM, including calendaring, contact management, task management, workflow, document management and integration with Microsoft Outlook. "Making a piece of software that handles these core functions is no small feat and you have some very large companies doing it," says Moulton. "Their offering in these core functions is bound to be strong because they have millions of users."

While you might say that Moulton has an incentive to sell XLR8 instead of the other packages because she charges for the license to it, I have no trouble believing her claim that this will not sway her. The reason that XLR8 has been more popular is simply that it is a compelling solution because it is using as its engine. "I can take the engine from and relatively quickly deploy a system customized to an RIA, and its engine will be fast, reliable and less expensive to maintain," says Moulton.

She says that implementing her template at a two-person advisory firm typically costs $3,000. For a firm with two partners and five support staff, expect Moulton's time to cost about $15,000 for data conversion; for the integration with your portfolio reporting software and document system; for the training of staff to use the system; and for helping you articulate the processes that you use in your firm, those that will be inserted into the system. Implementation for a firm with 10 to 20 employees that wants to build an elaborate "rocket ship" system can cost as much as $30,000. These fees are just for Moulton's time and do not include the licensing fees for An enterprise license costs $125 a month and then you pay $50 a month more for each user. Moulton says two administrative assistants can often share a login. She says a typical seven-person firm might need five licenses, thus it would pay $375 a month. In addition, she charges a one-time fee of $1,500 for XLR8 for the first user and $350 for each additional user. There are no annual license fees for the product.

While this may sound more expensive than other good solutions, Moulton points out that you no longer need to run Microsoft Exchange in your office when using gives you that same functionality-and that you are also saving by outsourcing disaster recovery, network security and other costs associated with maintaining your own network server. However, Moulton says the greatest savings come from the efficiency you'll realize by having a CRM system customized to your business's processes and technology applications.

With more than 32,000 companies on its platform, is the largest Web-based CRM provider in the world. It is designed so that you can make your own customizations with little or no training. You can add your own fields to different pages, change the user interface to match your labels, and tailor the program to your company's workflow processes without knowing any programming. gives you point-and-click configuration tools to customize every aspect of its system, and your customizations are retained through each version upgrade of the application.

In addition, the company has made it easy to integrate with other applications through its AppExchange directory. The directory is a list of applications that have integrated with's database using Web services. The directory of applications is divided into broad categories such as marketing and human resources. Under human resources, you might find an application that will make it easier for you to track employee vacation or sick days, for instance. Under the finance section of the directory is a category for wealth managers.

The AppExchange is presented in Web 2.0 fashion by giving users an opportunity to view a demo of each application and then allowing them to post their comments on each one. Wealth managers have only a few choices of applications right now. Moulton's XLR8 is one of only a few applications targeted to you, along with an interesting cash-position tracking application written by Ted Tsung, CEO of E-Assist Advisor and the former chief technology advisor at Thomson Financial's wealth management group.

Despite the paucity of users and participants right now, I'd bet that you'll see a growing number of applications geared to advisors that will participate in the AppExchange over the next couple of years, and independent advisors are likely to be drawn in. It will be built and they will come. It's only a matter of time. In fact, my guess is that you'll see a number of large and small tech companies that make portfolio accounting and financial planning applications for advisors integrate with because it gives them a chance at greater distribution by hooking into it. It's a way of giving technology firms serving independent advisors a large platform around which they can integrate and produce a "silver bullet" application integrating financial planning and performance measurement and accounting for wealth managers. And it will be produced and distributed independently of any custodian or giant financial services firm.

Keep in mind, however, that is just a technology company. It makes it easier to implement a customized CRM system, but the most difficult part of the job remains in your hands: developing policies, procedures and instructions. That's where Moulton can offer value. "I spend an enormous amount of time bringing together people from cross-functional teams and hammering out the workflows and where a baton passes between them," says Moulton. "I usually get them started and give them a framework for defining their processes and teach them how to do it themselves."

Having worked with some of the best wealth management firms in the nation, she has come to understand their processes. Bouncing ideas off of her about some of your processes and how to implement the CRM system is important. "It's all for naught if you are not committed to building the processes and committing the people needed to implement the system," she says.

Implementing a CRM system, as well as a document management system, requires a huge cultural shift for most small advisory firms. Everything must be documented and you often need to make it impossible for people to do their jobs without inserting data into the system. In my own company, we require that every customer contact be noted in our CRM system, and in fact, any time spent on a client matter must be recorded by our employees. This has increased efficiency and made staff more accountable and makes it all visible to your managers. I can tell you from my own personal experience that using a CRM is transformative. My company could not exist without it.

Good tools are available to you. Kim Moulton's idea of creating a CRM template for financial advisors using is the best new technology system for advisors that I've seen in a long time.

Andrew Gluck, a longtime writer and journalist, is CEO of Advisor Products Inc., a Westbury, N.Y. marketing company serving 1,800 advisory firms.