Wealth management is an industry where cloud economics haven't fully
taken hold—yet. The cloud giant, Salesforce.com, entered the space in
2016; and last year, Morningstar launched the cloud-based version of
our practice management software for independent advisors, Morningstar
Office℠ Cloud. But the industry as a whole is mostly still
tethered to its desktop computer.
When software manufacturers figure out how to scale the economics
of cloud software production, customers will be the true winners.
There are technical reasons for this—muddled in tech jargon like
multi-tenancy, scalability, and elasticity—but the benefits are real.
We'll focus on the business benefits financial advisors can expect, if
they seize the potential of cloud computing.
5 benefits of wealth management software:
You will be less like Dilbert the IT guy. Financial
advisors spend a lot of time evaluating and trouble-shooting
third-party integrations and account aggregation. These things can eat away
at your day. In the cloud, these tasks are easier for a wealth
management software producer to manufacture, maintain, and improve.
The less time you spend doing IT maintenance, the better. What would
Dilbert have done with room in his schedule? Maybe he would have
invented a new productivity tool for financial advisors.
Design matters to your clients. When industries
move to the cloud, the experience becomes just as important as the
software features. That’s because manufacturers can see how users
are interacting with their software and make changes based on user
behavior. If a feature isn’t used, a developer can respond and focus
on features that have impact. Then, the software becomes easier to
Your lexicon changes. Phrases like “user
experience” and “24/7 access” become more appealing than “client
portal” and “client ready.” Software companies position business
value and strategies over features. New third-party evaluators like
Gartner and Deloitte have opinions and start using this lexicon to
crowd out industry bloggers and industry journeymen. The industry
will reluctantly play along. And before you know it, your colleagues
will be demanding it. This is good news for your long-term success,
but it's important to start thinking this way now.
New competitors emerge and old ones disappear.
Wealth management software through the cloud means higher
productivity for financial advisors who take advantage of it. You
pay for what you use (and for what works), and the reward is more
time to build relationships with clients. Those who seize the day will grow faster and become
competitive. Those who resist will struggle with archaic systems and shrink—or worse,
Clients find you. Your wealth management software
makes it easier to deliver insights to clients at scale, which means
they are better informed and more engaged. Your clients may not drop
by your office like they used to, but you could be more connected to
them than ever before. They'll reach out by text, email, social
media, or through your software tools. There’s less formality around
asset selection and more informal interest in strategy and coaching.
You’ve probably experienced this with the recent tax overhaul in the U.S. Did
clients reach out to you in new ways than they did five years ago?
If they didn’t, you should worry. If they did, you are seeing
something that is significantly changing in the way you do business.
The move to cloud-based software will help accelerate that trend.
Read more about how your wealth management
software choices should amplify your business in “6 Reasons Your
Advisor Platform Should Be An Extension Of You.”
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