Technology Tools for Today's High-Margin Practice: How Client-Centered Financial Advisors Can Cut Paperwork, Overhead, and Wasted Hours

225 Pages·2013·2.35 MB·English

Additional Praise for
’
Tools for Today s High Margin Practice
“As a devout non-techie, I recognize that were it not for experts in the industry like Joel
BruckensteinandDaveDrucker,TheWealthConservancycouldn’thaveevolvedfrombeing
anemergingfirmtobeingwell-establishedandonitswaytobecominganenterprise.Joeland
Davehaveacrème-de-la-crèmereputation,andtheircogent,clearwriting,inlayman’sterms,
showstheyaremorecommittedtogettingthemessageacrossthanimpressingthereaderwith
their technical expertise. This book is a breath of fresh air—ahhh!”
—Myra Salzer, Founder, The Wealth Conservancy, Inc.,
Author, Living Richly: Seizing the Potential of Inherited Wealth
“David Drucker and Joel Bruckenstein are true visionaries in the field of advisor-related
technology.Manyofthesystemsandtechnologiestheyforecastovertenyearsagohavecome
to fruition and are now mainstream needs for successful investment companies. I have used
their insight and vision inmyown business togreat successand willcontinuetodoso. This
book provides helpful, new information.”
—J. Michael Scarborough, President/CEO,
Retirement Management Systems, Inc.,
Author, The Scarborough Plan: Maximizing the Power of Your 401(k)
“Technologytoucheseverythingwedoinourbusiness.Thisbookcoversall-things-techfrom
A to Z. It is a must-read for the RIA business owner and for those responsible for tech
decisions at financial advisory firms. Dave and Joel’s advice will improve your bottom line.”
—Tom Orecchio, CFA, CFPs, CLUs, ChFCs, AIFs,
Principal and Wealth Manager, Modera Wealth Management, LLC,
Former Chairman, National Association of Personal Financial Planners (NAPFA)
“It’s a daunting task for any advisor to stay focused on the client experience and stay up on
smoothly running an office. But, Drucker, Bruckenstein, and ‘friends’ have written THE
go-to book for advisors navigating the maze of technology and advisor solutions. This is a
terrific reference for every advisor’s shelf, laptop, iPad, Kindle, or Nook!”
—Alex Potts, President and CEO, Loring Ward Group, Inc.,
Co-author, The Wealth Solution: Bringing Structure to Your Financial Life
“This book is contains a wealth of knowledge and wisdom that is mandatory for any client-
centered financial advisor wanting to be relevant, efficient, and profitable.”
—Rick Kahler, CFPs, President, Kahler Financial Group
“Justwhenyouthinktheseguyscouldnotpossiblyofferevenmoreguidanceanddirectionin
the field of technology—they write a book. Brilliant! Dave and Joel are truly the icons when
welookbackonhowfinancialadvisoryfirmstackledthetoughtechnologydecisionsthrough
each decade. They are honest and straight shooters. Why are they so valuable? So many
times—money,time,andenergyaresavedbecauseofthesageadvicefromthesetwoexperts.
This is a book you want in your office.”
—Diane MacPhee, CFPs, Business Coach
Technology Tools for Todays' High-Margin Practice Edited by David J. Drucker and Joel P. Bruckenstein
© 2013 David J. Drucker and Joel P. Bruckenstein. Published 2013 by John Wiley & Sons, Inc.
ffirs 12December2012;14:20:36
“DavidandJoelleadtheindustryintheirinsightsonhowtousetechnologyeffectively.What
is so unique to this book is the integration of other thought leaders who bring a range of
expertiseandperspective.Thisislikeacrashcourseinimprovingyourbusinessfromsomeof
the brightest minds in the industry.”
—Julie Littlechild, CEO and Founder, Advisor Impact
“David and Joel have updated their definitive reference on leveraging technology for a prof-
itablepractice.Providingaconsistentexperiencecustomizedtoyourtargetclients’preferences
practically requires that you utilize technology, at least if it is to be done efficiently. Only in
thisworkcanyoufindmanyofthetopwriters,commentators,andpractitionersofferingyou
tipsandinsightsonmanyofthemostimportantaspectsoftechnologyinonehandyreference.
I bought the first edition in 2003, and it continues to be my go-to reference today.”
—Stephen Wershing, CFP, President,
The Client Driven Practice, Author, Stop Asking for Referrals
“David and Joel have provided all you need to know to choose the best technology for your
practice. And, let’s face it, in today’s world, you just can’t really practice without good
technology to support you. Get this book, it will save you time and money, I guarantee it!”
—Deena Katz, CFP, Associate Professor,
Texas Tech University, Author, Deena Katz’s Complete Guide to
Practice Management: Tips, Tools, and Templates for the Financial Adviser
“Buildingontherecommendationsandpredictionsfromtheiroriginalbook–whichallcame
true, and then some!—Drucker and Bruckenstein take a deep dive into not just the latest
technology tools that are available in today’s marketplace to enhance the scalability and
profitabilityofapractice,butalsoalookbeyondintohowtechnologytrendsmayfurthershift
in the coming years. Built collaboratively with an all-star lineup of contributors, Technology
Tools for Today’s High-Margin Practice is sure to become essential reading for anyone con-
sidering technology decisions in the coming years, large firm or small!”
—Michael Kitces, Partner with Pinnacle Advisory Group, Inc., and publisher of the
financial planning industry blog Nerd’s Eye View at www.kitces.com/blog
“Forthelastdecadewe’vebeenturningtoandrecommendingDruckerandBruckensteinfor
greatinsightsontechnologyapplicableinourbusinesses.Theirinsightsandexperienceshave
saved us hundreds of hours of redundant research, wasted time and money. In their latest
offering,thegurushave assembledanall-star lineupofindustryexperts,each contributingin
theirspecificareaofspecialty.Howdoyouenhanceagreatproduct?ReadTechnologyTools
forToday’sHighMarginPracticeandyou’llunderstandwhythisbookisthenewtechnology
resource I recommend to all financial professionals.
—Sheryl Garrett, CFPs, AIFs
Founder, Garrett Planning Network
ffirs 12December2012;14:20:37
TECHNOLOGY
’
TOOLS FOR TODAY S
HIGH-MARGIN
PRACTICE
ffirs 12December2012;14:20:37
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ffirs 12December2012;14:20:37
TECHNOLOGY
’
TOOLS FOR TODAY S
HIGH-MARGIN
PRACTICE
How Client-Centered Financial Advisors Can Cut
Paperwork, Overhead, and Wasted Hours
David J. Drucker
Joel P. Bruckenstein
ffirs 12December2012;14:20:37
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Copyright©2013byDavidJ.DruckerandJoelP.Bruckenstein.Allrightsreserved.
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Technologytoolsfortoday’shigh-marginpractice:howclient-centeredfinancialadvisorscancutpaperwork,
overhead,andwastedhours/DavidJ.DruckerandJoelP.Bruckenstein.
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Includesindex.
ISBN978-1-118-43476-5(cloth);ISBN978-1-118-48051-9(ebk);
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1. Financialplanners. 2. Finance,Personal-Computernetworkresources. 3. Investmentadvisors.
4. Investments—Dataprocessing. 5. Finance-Technologicalinnovations. I. Bruckenstein,JoelP.,1956–
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ffirs 12December2012;14:20:37
Contents
Introduction 1
David Drucker
CHAPTER 1
Selecting the Right CRM System 5
Davis D. Janowski
CHAPTER 2
The Future of Financial Planning Software 17
Robert D. Curtis
CHAPTER 3
The Future of Financial Planning Software and the
New Client-Advisor Relationship 27
Linda Strachan, Kory Wells
CHAPTER 4
Portfolio Management Software 37
Mike Kelly
CHAPTER 5
Achieving Growth and Profitability with Technology
Integration 47
Jon Patullo
CHAPTER 6
How the World Wide Web Impacts the Financial Advisor 61
Bart Wisniowski, Jason Lindstrom
CHAPTER 7
Managing Your Online Presence 73
Marie Swift
CHAPTER 8
Client Portals and Collaboration 93
Bill Winterberg
vii
ftoc 12December2012;15:7:10
viii Contents
CHAPTER 9
The Cloud 107
J. D. Bruce
CHAPTER 10
Digital Signature Technology 129
Dan Skiles
CHAPTER 11
Innovative Software and Technologies Implemented
at One of the United States’ Leading Advisory Firms 139
Louis P. Stanasolovich, Christopher J. Kail, Sherri M. Slafka, Daniel D. Kleck
CHAPTER 12
Virtual Staff Sparks Growth, Profitability, and Scalability 159
Jennifer Goldman
CHAPTER 13
ROI—The Holy Grail of the Technology Purchase Decision 173
Timothy D. Welsh
CHAPTER 14
Building an Efficient Workflow Management System 187
David L. Lawrence
EPILOGUE
Advisor Technology: Yesterday, Today, and Tomorrow 197
Joel P. Bruckenstein
About the Authors 205
About the Contributors 207
Index 219
ftoc 12December2012;15:7:10
Introduction
David Drucker
In2001,IapproachedJoelBruckenstein(whowasknowntomeonlyasaseemingly
like-mindedwriterforthefinancialtradepress)andtoldhimaboutabookforwhich
I was developing a business plan. He agreed it would be an interesting project for
collaboration.Ayearlater,BloombergPresspublishedVirtualOfficeToolsforaHigh-
Margin Practice and it became an instant hit.
Ofcourse,it’sthetypeofbookthatrequiresfrequentupdatinginordertoremain
useful to our readers and, for the past 10 years, we’ve opted instead to publish a
monthly technology newsletter as a means of keeping the book current. Yet, after
many requests from readers and from John Wiley & Sons (which partnered with
BloombergPress),wefinallyagreedin2012toupdatethebookforpublicationbythe
T3 Conference in February 2013.
Thisnewbook—TechnologyToolsforToday’sHigh-MarginPractice—posesavery
differentchallengethandidthefirstbook,namely,thattechnologyhaschangedvastly
over the last 10 years since we wrote the first book. Joel and I penned the first book
based upon our own technology experiences trying to assemble our own virtual
offices, offices based on the use of technology and outsourcing such that we could
function in a world of much larger competitors with what, essentially, remained
simple home offices. Although it isn’t every financial advisor’s goal to have a virtual
office, the principles we followed in creating ours have proven essential to creating a
technologically up-to-date firm of any size and shape by gaining advantages over
competitors by employing technology and outsourcing wherever profitable to do so.
Inotherwords,whatmakesthesmallervirtualofficeprofitableisthesamething
that makes the larger firm profitable—paying attention to the efficiencies available
through technology. Technology can be used to achieve scalability either up or
down . . . up by expansion of the larger firm that wants to add employees and grow
indefinitely and down by the contraction of the firm that wants no employees and
chooses, instead, to outsource as much as possible. Today, readers of our book still
come in both flavors though expansion seems to be the dominant trend.
So, whereas, Joel and I could and did write the first book based on our own
experiences, readers were taking those ideas and applying them to all manner of
advisory firms—not just those seeking to remain small virtual offices but expanding
Technology Tools for Todays' High-Margin Practice Edited by David J. Drucker and Joel P. Bruckenstein
© 2013 David J. Drucker and Joel P. Bruckenstein. Published 2013 by John Wiley & Sons, Inc.
1
cintro 12December2012;14:31:45
2 Introduction
firms, as well. The lessons learned in the past 10 years have expanded the body of
knowledgetowhereJoelandIdecidedwecouldproduceabetterproduct,intheway
ofasecondbook,ifweengagedthehelpofthemanyexpertswhohaveemergedinthe
whole field of investment advisor office technology.
To illustrate how far we’ve come in the past 10 years, let’s look at four recom-
mendations from the first book and assess their relevancy today:
1.Recommendation: A paperless office might be beneficial to your operation. Buy a
Fujitsu (or other recommended) scanner and software like PaperPort Deluxe to
begin converting paper to digital records.
Today,apaperlessofficeisn’tjustbeneficial,it’sessential.Awholeindustryhas
grown up around the need to serve financial advisors and other small business
offices looking for sophisticated hardware and software with which to escape the
inefficiencies inherent in dealing with paper. Not only have better paperless office
tools grown up, but they are integrated with other key systems like CRM software
so that client records can be viewed in an integrated format.
2.Recommendation: Consider using flash storage devices for easy, portable backups.
Flash storage devices, or thumb drives, as we knew them back then, are
ubiquitous now. Storage capacities have climbed to as much as 32 gigabytes while
prices have plummeted, making flash storage devices handy gifts rather than the
moderately expensive backup devices we saw them as 10 years ago.
3.Recommendation: In the earlier book, e-mail was touted as the best communi-
cation system for advisors and their clients.
Today, we’ve seen all manner of embellishments on this very basic (though
still essential) communications system. In addition to e-mail, advisors and clients
interact through client portals, online storage systems like Dropbox, social media
networks(whichbarelyexisted10yearsago),andothersystemsdesignedtoenhance
thee-mailexperience,makingiteasiertosharelargedocumentsandfiles.
4.Recommendation: A customer relationship management (CRM) system is
important to managing clients. We discussed the benefits of Microsoft Outlook
and add-ons for financial advisory firms from CRM providers like Sage ACT!
and Goldmine. We also recommended several industry-specific CRM systems,
one of which (Junxure) has expanded to become an industry leader, the other of
which (ProTracker), while still in use, has faded substantially from its earlier
prominence.
ThemodernfinancialadvisoryfirmusesaCRMasthehubofitspractice,giving
it access not only to client database records but client documents and, more impor-
tantly,asystemformanagingworkflow.WhereearlierCRMsweresimplyrepositories
for basic client information (computerized rolodexes, in other words), CRMs today
allowthefirmownerandhisorheremployeestotrackwithgreatspecificitywherethe
firm is in serving each client’s every need.
Thesearejustafewoftherecommendationsmadeintheoriginalbookthathave
beencompletelysupersededby10yearsoftechnologicaladvances.Atthesametime,
cintro 12December2012;14:31:45