Trends, Disruptive Forces, and Useful Apps

Bill Winterberg, CFP

References & Resources April 24, 2013

Technology as an Equalizer
There's never been a better time to be an independent financial adviser. Technology has leveled the playing field in the industry, allowing advisers to compete directly against institutional firms in the way they market to, attract, and serve today's discerning clients. But technology is advancing more rapidly than ever, challenging advisers to keep up with the latest innovations for their business. To continue their growth, advisers need to embrace the right technology that delivers positive results. This session will identify key trends, disruptive forces, and useful apps that will shape the framework of financial advisory firms in the years to come.

Key Trends
Trend #1: Application Programming Interfaces (APIs)
Historically, financial advisers managed their software and hardware infrastructure in their office, described as on-premises equipment. As core applications like portfolio management, CRM, and financial planning software move to a cloud, or online, delivery model, advisers can more easily integrate their applications. Here are some API examples for advisers: Salesforce users can choose from over 1,700 apps from the Salesforce appexchange. Apps enhance the core CRM functionality by adding marketing, collaboration, analytics features plus many more. iPhone, iPad and iPod Touch users have downloaded over 25 billion apps for iOS. The Apple App Store is synonymous with useful apps that enable iOS devices to perform almost any task. In financial services, TD Ameritrade Institutional launched the Veo Open Access environment, which defines an API to which third-party vendors can integrate to send and retrieve data directly with the custodian.

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Trends, Disruptive Forces, and Useful Apps

Bill Winterberg, CFP
References & Resources April 24, 2013

Trend #2: Automation and Business Process Management (BPM)

Advisers have embraced automation in recent years to systematize back office functions and add scalability to processes that once required many intermediate manual steps. Automation in the following areas contribute to a reduction in operating costs while increasing capacity: Portfolio rebalancing Account aggregation Meeting material preparation Quarterly report production and delivery Billing

Building the most valuable asset of a financial services business, the relationship with a client, cannot be automated. Developing and nurturing those relationships can, however, be augmented and complimented through appropriate use of technology (see Presence below). Business Process Management (BPM) is a technique used to continuously identify areas in a business where efficiencies can be gained. BPM requires at least five of the following actions (listed sequentially): Design: Describe, in detail, the steps required to complete a process. Model: Identify the systems and resources required to complete a process. Use: Implement the process as designed and put it through real-world testing. Monitor: Collect metrics and statistics on the efficacy of the process. Improve: In response to knowledge gained from monitoring, identify how the process can be improved.

Trend #3: Social Business

Businesses are moving away from operating in internal silos and are embracing collaboration. The rise of the social business mimics the valuable aspects of social networking, but modified for the business environment. Social networking websites like Facebook, LinkedIn, and Twitter have hundreds of millions of users due to the ease of which users can stay informed about news within their network. Encourage colleagues to collaborate and share information and resources using social business applications. Several applications include: Chatter: This Salesforce add on allows colleagues to monitor business news feeds, process workflow, and stay informed on business activity using mobile devices. Jive: An independent vendor selling social business software. Platform facilitates collaboration, document sharing and editing, and knowledge management (think Wikipedia). Yammer: Now a Microsoft product, Yammer largely resembles the Facebook news feed with the ability to create collaboration groups both internal and external to the business.

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Trends, Disruptive Forces, and Useful Apps

Bill Winterberg, CFP
References & Resources April 24, 2013

Disruptive Forces
Force #1: Big Data
What is big data? Its any collection of an enormous amount of data that is difficult to quickly interpret. The map of the human genome is a good example. How does big data apply to financial advisers? With emerging tools, big data can identify trends, characteristics, and opportunities using large volumes of data collected from clients or even from advisory businesses. Consider how advisory firm benchmark surveys continuously updated in real time would differ than one compiled from voluntary survey results aggregated over several months. One company using big data in its financial planning software is inStream. inStreams Trends feature aggregates financial plan data across thousands of advisers and clients, condensing the information into meaningful analytics. Such analytics can identify the average probability of success for client retirement income plans. Rather than running Monte Carlo simulations for one client with one probability factor, inStream can chart all of the probability factors and segment them among client age, income, savings ratio, and other variables.

Force #2: Online Advice Platforms

Consumers have more access now to competitively priced financial advice platforms delivered over the Internet. Companies like Personal Capital, Wealthfront, LearnVest, and more offer services similar to those of traditional financial advisers at much lower price points. For a one-time payment of $399 and $19/month fee, LearnVest clients receive a financial plan created by a CERTIFIED FINANCIAL PLANNER certificant, portfolio analysis, and unlimited email and phone consultations.

Force #3: Presence Technology

Where does work take place? Is there something magic about the four walls and the desk you have in your office? And why must you primarily service clients who live within a reasonable driving distance? It is now possible to converse, engage, and interact with people across the world. Your ideal client is one whose needs are closely matched with your specialized services, not one who simply lives near your office. Video calling apps like Skype, FaceTime, and Google+ Hangouts let you overcome geographical barriers to connect with clients and prospects. All three work from desktops, laptops, and mobile devices. Presence technology expands on video calling apps, with products like Beam and Kubi for iPad allowing callers to control the video device in use.

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Trends, Disruptive Forces, and Useful Apps

Bill Winterberg, CFP
References & Resources April 24, 2013

Useful Apps
New apps are released every day, but the ones listed below are particularly useful among financial advisers. Workflowy, web-based, freemium: Workflowy functions like a large piece of paper where you can list thoughts and to-dos in the way you normally think about them. Each entry can be broken into segments, and each segment can also be expanded into its own related segments. Workflowy is comparable to mind mapping, but without the graphic element. Contactually, web-based, freemium: Contactually is a personal relationship assistant that creates automated reminders when you should follow up with colleagues. Contactually uses past email interactions to gauge the relevance of conversations and uses that intelligence to prompt you to reconnect with someone after time goes by. TextExpander, Mac, $35: You type many of the same things day after day. Why not use shortcuts to make quick work of the repetitive typing you do? TextExpander allows you to create your own snippets (shortcuts) that, when typed, automatically expand into full text. TextExpander can also automatically enter date and time information, as well as insert text copied onto the clipboard. PC users will want to investigate PhraseExpress and AutoHotKey. RescueTime, web-based, $72/year: When Friday afternoon rolls around, youre exhausted, but you cant exactly remember all the things you worked on over the past week. RescueTime is an app that monitors the files and programs you use on your computer, summarizing your activity with informative reports. RescueTime can also alert you when youve spent too much time on distracting activity (social networking websites) and temporarily block websites youve marked as distracting when you need to be in focus mode. Doodle, web-based, freemium: When you try to schedule meetings or phone calls with busy clients, you often play a game of Battleship exchanging messages trying to lock down a time everyone is available. Doodle lets you publish a version of your calendar online that shows your availability. Visitors can easily see when youre free for a meeting and propose to meet at that specific time. Other public calendar programs to consider include ScheduleOnce, TimeBridge, Bookeo, and TimeTrade.

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