Let’s face it, getting advisory firms to change how they operate is challenging, but there comes a time to face the fact that old methods of conducting business have become outdated, and adopting smarter operations becomes a necessity. How advisors conduct their trading is an area that demands an improved advisor experience - the good news is that tools to address current inefficiencies in the industry are already available.

Application programming interfaces (APIs) for order management systems (OMS) provide firms with the ability to rapidly build and customize a trading platform for advisors of discretionary accounts. Within a few months, firms that leverage these tools regain control over the advisor trading experience, the advisor interface, and the release cycle of new advisor trading features.

For advisory firms, understanding specifically which processes to optimize and which tools to use is the hardest part. Here are three tips to allow this evaluation process to deliver a world-class advisor trading experience:

  1. Create an advisor journey map – Identify every step advisors take to conduct a trade, including the actions taken before and after the trade is completed. This identifies activities that may be automated to save advisors time, such as manual loading of orders or allocations.
  2. Audit the advisor experience – Examine advisor trading from different angles to ensure the system is optimized to accommodate diverse product and process requirements. The trading landscape is becoming more complex; firms need to ensure they can handle processes like algorithmic trading, thinly traded securities, trade away, block trading, and elimination of manual processing for mutual fund orders.
  3. Dedicate focus from senior management – The trading advisor experience is not going to change without significant prioritization from senior management to demonstrate real support for the initiative.

Getting a little more granular on these points, when advisory firms work with OMS-as-a-Service vendors, they gain more influence over the advisor trading experience in a few key ways:

  1. Control – Firms using OMS APIs retain control over the look and feel of their advisor's trading. Rather than merely white labeling a third-party application, the firm tailors the workflows to optimize and automate the experience, such as appearance, layout, and data.
  2. Customization – A firm may selectively integrate key functions based on the audit results using the OMS APIs to customize or extend its existing platform. Directly managing functionality is far superior to being beholden to other vendors to develop and release changes.
  3. Flexibility – APIs offer the flexibility to incorporate trading functions across the platform, such as creating and sending orders from rebalancing software or adding trade executions and account allocations into accounting platforms. 

For the three tips above, support from senior management is key to delivering a modern advisor trading experience. Some major considerations for leadership include:

  1. Time-to-market – A new advisor trading experience with APIs can be deployed quickly, in a matter of months, by skipping long planning meetings and implementations necessary for firms to build their own OMS. Leveraging APIs is an agile approach compared to a monolithic one-size-fits-all solution.
  2. Domain expertise – Firms gain domain expertise to build an OMS, including the connectivity required to trade away and support other advanced trading features. The business logic is directly built into the API eliminating the need to incur additional expenses or hire staff to create internal know-how.
  3. Proven – The API approach provides access to a proven product that has been vetted and validated in the marketplace. It reduces the risk of project failure, especially when combined with APIs that enable the use of the software in a highly customized form.

Today's advisors need to offer tailored, customized portfolios to investors backed efficient trade operations. The modern trading landscape is highly complex, and firms should follow these steps to ensure their advisors have the tools needed to access a wide range of functionality and asset classes. The most innovative advisory firms use the API approach as a core component to improve and optimize the advisor trading experience without requiring all of their available resources. 

Brian Ross is CEO of Flyer. He has more than 20 years of experience at leading Wall Street software firms.

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