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Morningstar Product Insider

5 Wealth Management Software Benefits for Advisors

Why advisors should seize the potential of cloud computing

Wealth management is an industry where cloud economics haven't fully taken hold—yet. The cloud giant,, 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:

  1. 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.
  2. 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 use.
  3. 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.
  4. 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, disappear.
  5. 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.

Rob Pinkerton is the chief marketing officer at Morningstar.

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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