Three priorities for advicetech – integration, integration, integration

It’s a pain having to get the card out, peer at the tiny numbers and key in your address, the long number, expiry date and those three digits on the back of the card that always seem to fade. So it’s a relief when it’s all done for you, especially if you’re on an app or website you’ve never visited before.

In fact, we’re increasingly insisting on our favourite online technologies integrating so they don’t have to ask us our life story every time we want to do something.

My budgeting app knows my bank details, my project management app knows what’s in my calendar and my social media apps know what’s stored on my smartphone camera.

Why, then, is this type of integration not the norm in financial advice?

The problem of re-keying

When advisers are onboarding new clients, there is a system to get them registered, another piece of technology to do a fact find, sometimes another to conduct risk-profiling and another to do cash flow projections.

Then you go back to the original system to complete the cycle and start using a platform to invest the client’s funds. The annual review often means going through the whole process again.

A recent report by The Lang Cat consultancy for Origo, entitled A Disconnected World, estimated that in a typical new client journey, the client’s details are keyed at least three times.

The consultants also found that 85% of firms agree that lack of integration was causing serious inefficiency in their business and estimated that a typical firm could be twice as efficient if systems were properly integrated.

This roughly echoes my own experience – I’ve estimated that integration could reduce the whole process from around 25 hours to around only 15 hours or less.

Advisers want integrations but are the Big tech firms ready to deliver?

When we talk to potential new clients about Turo, our automated advice engine, we commonly run up against the following challenges. Our target customer is often a financial institution with 200+ advisers, they’re already using multiple technology systems (I haven’t even mentioned accounting systems, messaging tools, marketing technology or software that sources mortgage, annuity and protection products!) - So they’re averse to taking on any new systems that don’t talk to each other, or the existing tech stack.

They want to move seamlessly between their CRM system, platforms, product providers and the rest. They want integration!

A difficulty is that some of the larger tech companies don’t make it easy. The report I just mentioned described the mismatch beautifully as follows:

“The truth is that most adviser clients of back office systems, financial planning toolsets and platforms, would rather have systems which genuinely spoke to one another than another piece of functionality to get used to. And so we have a mismatch – advisers simply wanting the basics done well and an integrated, open-architecture ecosystem: small technology firms needing relationships with large platforms and confidence to make decisions on where to spend their limited resources, and large product providers, platforms and technology firms adding functionality, bells and whistles which don’t solve the fundamental issues advisers face.”

The resistance at some larger tech firms to enabling integrations with smaller pieces of software is often spawned by an unnecessary fear of the costs – they often estimate that a single integration could cost hundreds of thousands of pounds. Yet, when you use APIs that open-up access to data in both directions, this doesn’t have to be the case.

The Wealth Wizards view

For us, this is the next big challenge facing advice-tech. Integrations might sound techy, but they are designed for advisers’ convenience. They enable advisers to continue to use new gadgets and tools, alongside the tech they’re already using. Crucially, they save hours because they eradicate re-keying. That’s why we’ve already integrated Turo with Intelliflo’s iO and why we’re developing integrations with other large CRM systems (watch this space!).

Integrations are better for the customer, better for the adviser and, ultimately, better for their firm’s bottom line.

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