At the end of March, I had the privilege of listening to an InformationWeek - Wall Street & Technology webcast entitled “CRM Integration Strategies to Increase Financial Advisor Satisfaction and Drive Growth.” One of the featured speakers was Sophie Schmitt, a Senior Analyst with the Aite Group, an independent Boston-based research and advisory firm focused on the financial services industry. During the webcast, Sophie highlighted the value that CRM can provide to wealth management firms. She also previewed some of her findings from her latest report entitled “CRM for Wealth Management: Approaching Total Practice Management.” Sophie shared that leading, best-in-class wealth management organizations implement CRM throughout their sales and client services teams and these users consistently abide by and adhere to uniform best practices. The resulting increase in productivity from CRM enables advisors to interact with top-tier clients more frequently and stay abreast of an influx of client requests and activities. The use of CRM along with other integrated technology lays the foundation for a total practice management approach, for it provides a unified view of all client assets and liabilities. All in all, CRM empowers the financial advisor to truly deliver a unique, differentiated experience to their sophisticated, high net-worth clients who are becoming increasingly demanding and risk-averse after the financial meltdown. As a result of these new realities, Aite affirms that the wealth management sector is one of the fastest growing areas of overall IT Capital Markets spending. In fact, it was revealed that 22% of surveyed firms intend to increase their IT spending to aid their wealth management practices. Aite’s report even forecasts that North American wealth management firms will increase their investments in CRM technology by 8% over the next five years as spending is estimated to rise to $620 million in 2014 from approximately $460 million in 2010.
Despite the anticipated increase in IT CRM spending, there is still plenty of room for growth in the wealth management arena. For instance, of the 380 financial advisor respondents to Aite’s survey, almost 25% of them disclosed that they currently do not have access to a CRM system or they do not find a CRM solution useful enough to incorporate into their business model. Today is a great opportunity for advisory firms to adopt CRM technology and strategies into their practice. Wealth management firms need CRM not only to more effectively manage affluent household prospects to grow their total assets under management, but to also enhance client service to existing clients, who often have relationships with multiple other advisors, which was previously discussed here. Furthermore, with more regulatory oversight and required disclosures looming on the horizon, it is critical that wealth management firms equip their producers with a CRM tool, just so they can demonstrate compliance and maintain their fiduciary standard. All historical interactions, including client investment recommendations, can be logged. Embedded workflows can streamline and automate processes, such as client onboarding and the set-up of recurring client portfolio review meetings. With all client activity, notes, and background stored in CRM directly within Outlook, client support teams will know exactly what is going on with a client, even if the primary advisor is not in the office. That is, support levels and response times should not drop off if an advisor is in another meeting or traveling.
Finally, it should be noted that Aite ranks Microsoft Dynamics as a best-in-class CRM provider in the large firm category. Moreover, due to the widespread adoption over the past decade of the cloud computing hosted model and its relatively lower total cost of ownership, firms of all sizes can now take advantage of the enterprise-class functionality and scalability of Microsoft Dynamics CRM 2011. In particular, Aite’s report praises Microsoft Dynamics CRM’s highly flexible architecture, which allows wealth management firms to customize and tailor the solution to meet their unique needs and distinct business model.
To learn more about how Customer Effective can help wealth management firms leverage a customizable, collaborative CRM solution that will pave the way to a total practice management and comprehensive financial planning experience, please visit www.customereffective.com.
by Customer Effective, F;orida and Georgia Microsoft Dynamics CRM Partner
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