Schwab advisor services announced several new initiatives and provided updates on a number of previously announced projects during its annual Impact conference, held in Chicago in mid-November. Perhaps the most interesting and the most controversial of the new initiatives is the planned launch of Schwab OpenView MarketSquare, an extension of the Schwab Intelligent Integration Initiative.

The impetus for the MarketSquare launch was Schwab’s 2012 RIA Benchmarking Study, which found that selecting the right technology to meet a specific need was one of the most pressing challenges that advisors working with Schwab face. “This industry has grown by leaps and bounds over the past five or 10 years, which means that there are more providers and more resources than ever dedicated to serving independent investment advisors,” says Neesha Hathi, senior vice president of technology solutions for Schwab Advisor Services. “But with this proliferation of providers comes the challenge of navigating the marketplace to find the right solutions for each particular firm’s needs. We are creating MarketSquare as a way to provide our clients with feedback on the vendors they are considering, based on the opinions of their peers.”

Still, even though advisors clearly need more help selecting proper technology, the MarketSquare initiative is a risky move for Schwab. And there are a number of potential problems with the proposed service.

First, unlike rankings on, say, Amazon, the comments and ratings on Schwab’s service will be edited. The term Schwab uses is “curated.” The way we understand it, the company will edit out comments it deems malicious, inaccurate or not useful. The company likens the approach to the one Zagat uses when it rates restaurants.

But the analogy does not work exactly. First of all, editing feedback is a slippery slope, especially when you are not an independent. Schwab partners with some of the providers being rated, and it has its own vendor that produces portfolio management software. How will the company deal with those conflicts of interest? Furthermore, to evaluate the validity of the reviews, Schwab would need employees well versed in all of the products being examined. Is the company devoting the resources to adequately address these concerns? It has not yet addressed them to our satisfaction.

Furthermore, we believe there is a difference between rating food and books and rating technology. Many advisors are not as familiar with their software as they should be, hence their ratings may be of less value. (The exceptions would be in the areas of service and support, which experience tells us advisors do an excellent job evaluating.) One could also argue that the sample size Amazon and Zagat are working with is sufficiently large and diverse. Would the same be true for MarketSquare?

Perhaps most disturbing is the fact that only vendors who opt in can be ranked. So if Schwab receives uniformly poor feedback about a vendor, but the vendor has not opted in to the MarketSquare program, readers will never see those poor reviews. Might the advisors then assume that non-participation is a red flag? Perhaps, even though there could be legitimate reasons why a firm would choose not to participate.

To be fair, I believe that when the folks at Schwab decided to roll out MarketSquare, they had nothing but good intentions; I’m just not sure that they thought through all of the implications before unveiling it. Furthermore, some people at Schwab see MarketSquare going beyond technology, perhaps covering areas such as consultants, compliance attorneys and other service providers. It is possible that the program will be more successful in some areas than others, and that it will be modified over time as Schwab receives feedback. It will be very interesting to see how this initiative plays out.

Schwab has also announced a multiyear project to upgrade its service model in order to help advisors serve their clients more effectively.

“Advisors are facing a number of competing forces when it comes to meeting clients’ needs and expectations,” says Naureen Hassan, a senior vice president at Schwab Advisor Services. “The world is getting more complex in terms of regulations and concerns about security and fraud, but at the same time clients want anytime, anywhere attention and access. We have seized this opportunity to take a fresh look at how we serve advisors and their clients and to look for ways to make processes simpler and more efficient.”

As part of this, Schwab announced a deal with DocuSign Inc., a leading provider of e-signature technologies for financial service firms. DocuSign already has similar agreements in place with other custodians, including Fidelity and TD Ameritrade. Schwab’s goal is to allow e-signatures on as many of its forms as are practical. When the project is complete, advisors will be able to log on to Schwab Advisor Center and create electronic packages of forms that clients or prospects can review, complete and sign while online.

A number of technology executives at Schwab emphasized that this initiative goes way beyond e-signature capabilities. “E-signature is one example of the ways in which we are looking to make the client experience simpler and more efficient,” Hathi says. “Technology itself only gets you so far and needs to be married to the work flows that advisors use in their offices. We are building e-signature into the fabric of Schwab Advisor Center in order to help advisors manage the initiation, completion and status monitoring from a familiar and well-understood platform as well as vastly streamline the paperwork processes.”

During a “Tech Talk” held at the Impact conference, Hassan said that firms are dealing with internal work flows that involve too many steps and too many people. As part of its initiative, Schwab wants to help advisors by reviewing all their work flows, minimizing the number of steps.

Schwab also used the conference to emphasize its mobile solutions for advisors. Earlier this year, the company launched its advisor app for the iPhone, and approximately 4,000 advisors have already downloaded it. More recently, the company unveiled an iPad app for advisors, which it demonstrated at the Impact conference. The app takes advantage of the larger screen to display large charts and other information in a clear format. But it does not currently offer trading capabilities. According to Schwab, other things are currently higher on its development priority list.

For example, last year Schwab rolled out a mobile app for retail investors. According to Hassan, 60% of deposits into Schwab retail accounts now come through mobile devices. Given the success it has had with mobile deposits on the retail side, Schwab would like to extend those capabilities to the advisors’ app. (Advisor clients can already make use of Schwab’s mobile deposit capabilities through their iPhone, iPad and Android devices.)

“Our mobile offering is one of the backbones for enhancing how advisors and their clients interact with us and with each other,” Hathi says. “This will be a key and ongoing area of investment for us in 2013.”

That being the case, I’m surprised that Schwab has not yet released an Android app for advisors. (It expects to release one by April 2013.) I’m also disappointed that Schwab has no immediate plans to create apps for the Windows 8 phones or for the Microsoft Surface tablet (which uses Windows 8 or Windows RT). I was told that the development of these apps is based on customer demand, and that there is none yet. The problem, of course, is that by the time the demand is there, Schwab will have to plan and budget for the apps’ development, which means it will take too long for them to appear.

On a more positive note, Schwab plans to take to a whole new level. For those unfamiliar with the site, it is a special version of designed specifically for the clients of advisors. In the past, clients have used it mainly to access their account information, but going forward Schwab thinks the site can play a much larger role. “We think it has the potential to become a dynamic hub for ongoing interactions, providing a communication portal for advisors’ clients that are managed by the advisor,” Hathi says.

The key for Schwab if it wants to expand the role of is that it must further customize the site. Previously, advisors couldn’t co-brand on the site, but now they can. Beyond that, Schwab has offered three other distinct customization options for advisors to offer clients. The most extensive one offers clients all of the options the site provides. A second version offers most options, but requires clients to consult with their advisors before they trade or move funds. The third option is the most limited, offering the clients basic account information without giving them the ability to trade or move funds.

So what’s our overall verdict on Schwab’s technology advances since the last Impact conference? I’d say it is decidedly mixed. Schwab clearly has a dedicated group of technology professionals who understand the needs of their advisors and who appear committed to delivering the technology and support the advisors need. They have plans to improve work flows, further automate tasks and make greater use of mobile platforms in the years ahead.

On the other hand, the progress on some fronts is taking longer than expected. Although Schwab recently announced integrations with Advent and NetDocuments, these initiatives are trailing those of competitors. Schwab was the last of the major custodians to bring iPhone and iPad apps to the market, and it is the last to bring an Android app. Although Schwab recently announced a deal with DocuSign, the company is still a year away from bringing e-signature capabilities to advisors, while other broker/dealers and custodians are already using these technologies. These delays should concern the folks at Schwab, who are used to being market leaders.

The MarketSquare initiative, while well-intentioned, may not be the best use of the company’s resources given its other more pressing needs.

Overall, however, advisor technology is moving forward at Schwab, and there appears to be a well-defined road map for the year ahead. If Schwab can execute all of its plans for the coming year, it should be in a much stronger competitive position technologically by the following year. We’ll just have to wait and see.