As consumer financial technology takes off and fees decline, advisors are seeing their margins squeezed. At the same time, clients have higher expectations about the technology their advisors can provide. That means fintech must be able to evolve to meet those demands.

To meet those challenges, the leading independent broker-dealer firms are rolling out new platforms and tools to help advisors compete effectively.

Commonwealth Financial Network
One issue that advisors continue to struggle with is secure communication with their clients. Advisors have a responsibility to protect confidential client information, especially in an age when imposters are learning how to impersonate clients. This is even more challenging for the advisors when clients often seem to favor convenience over security.

Many firms find it challenging to pass documents with confidential information back and forth—when accounts are opened, for instance, or when money movements are authorized. Confidential information must be kept confidential, but the communications channel cannot pose a bother to the client.

E-mail is fast and convenient, but unsecure. That conundrum also applies to texting with standard SMS messages. A fax is secure, but it’s old technology and many clients don’t have fax machines.

To address this issue, Commonwealth Financial launched its own secure messaging infrastructure earlier this year. Advisors and clients can access it through the company’s web portal or a mobile app (Commonwealth currently supports both the Apple and Android operating systems). Secure messaging helps advisors deal with both their operational and regulatory needs. The messages are archived, which helps the advisor stay in compliance with regulations, and the messaging system is integrated with Commonwealth’s proprietary CRM software, so the messages are linked to appropriate households and tracked.

To further help advisors with their operational efficiency, Commonwealth is rolling out its new CRM work flow engine. A work flow is a series of actions or tasks that can be launched together. These usually center around an event such as a client review meeting; a work flow might require, for example, that you complete three tasks before the meeting (perhaps remind the client, prepare reports and contact the client’s accountant) and then follow a number of steps after the meeting, too. Each step can be programmed to launch at a set interval before or after the event. These are known as “static work flows.”

Commonwealth has created a handful of work flow templates, such as one for opening new accounts and one that launches when a client dies. Advisors can modify these or create new ones as they like.

Commonwealth plans to add dynamic work flows as well. Unlike static work flows with set completion dates for each task, dynamic work flows can be adjusted on the fly. For example, if step one is scheduled for four days from now, followed by step two, also scheduled four days from now, a dynamic work flow would be able to adjust if step one required five days, so that step two would be pushed back. The second step could be programmed to maintain the original schedule (only three days for step two), or it could be programmed to allow the original allotment of four days.

Commonwealth is working on integrating texting into the CRM so that advisors can communicate with clients through text as opposed to e-mail. According to Darren Tedesco, the managing principal of innovation and strategy at Commonwealth, the firm is striving for a solution that meets the following criteria:

• It must ensure that clients can use their existing text apps.

• It would not require advisors to get a new phone number or a second phone.

• All communication could be seen in the CRM record.

According to Tedesco, Commonwealth recently upgraded its account aggregation capabilities. “We switched providers from Yodlee to Quovo,” he says. “While Quovo is not perfect, it is better than Yodlee.”

Commonwealth is rolling out a new, innovative account opening and authorization system called Propel that is designed to minimize the need for client signatures. When a client initiates a relationship with a Commonwealth advisor, he or she will sign a master service agreement. With this, the client can open additional accounts, change the options on existing accounts and transact many other types of business without needing to sign more documents.

Tedesco anticipates a full overhaul of the firm’s Client 360 suite of tools in 2018, including a complete refresh of the user interface.

Perhaps the biggest news at LPL is its long-awaited switch to a new advisor workstation, known as ClientWorks. LPL is now encouraging advisors who are still exclusively using the old system, BranchNet, to start transitioning to ClientWorks. The company has created a special service team to help advisors make the transition and is also offering education and training to ease the switch. LPL’s goal is to fully transition all advisors to ClientWorks by the end of November and at that time finally retire BranchNet.

The new platform is superior in every respect. It is faster, boasts more functions and has a more intuitive interface. It is also better equipped to work with and integrate the programs of outside firms. All of the newer LPL technologies available today, as well as those to be released in the future, will reside on ClientWorks.

For example, LPL requires that an advisor be on ClientWorks to sign up for Guided Wealth Portfolios, the LPL digital solution powered by BlackRock technology. LPL’s investment research team creates model portfolios on the platform that are implemented using BlackRock’s ETFs, giving advisors the ability to compete with direct-to-consumer robo-advisors. All of the GWP assets are custodied at LPL.

Both the advisor-facing GWP technology and the client-facing technology are deeply integrated with the LPL ecosystem, meaning that LPL advisors can view all of their accounts through one platform. Clients can view their GWP accounts through AccountView, the LPL client portal for both traditional and GWP accounts, or they can choose to view their GWP accounts through the GWP mobile app. Each day, GWP technology looks at each account for dynamic rebalancing opportunities. The technology does not rebalance accounts every day, but if there is a significant tax loss harvesting opportunity, asset class drift, cash flows in or out, or other opportunities, the system will initiate trades. The technology is smart enough to rebalance at the household level, and to incorporate asset location factors into the rebalancing algorithm.

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