Bad tech is bad for advisors’ business
With everyday tasks so reliant on technology, advisors were recently asked about how their firms handle technology.
As it turns out, if advisors are using outdated or subpar tech, they’re likely to ditch their firm for another, according to a study released Wednesday.
Advisor360’s latest Connected Wealth Report found that 92 percent of advisors would switch firms because of a poor technology set-up, while 44 percent already have. In addition, 58 percent said they’ve lost new business over bad tech.
The report also found that firms that invest in great technology have a proven competitive edge over their rivals. Ninety-three percent of advisors with state-of-the-art technology have gained new customers because of competitors’ bad tech.
Nate Lenz, CEO and co-founder of independent registered investment advisory firm Concurrent, said that even though the industry has increasingly moved toward independence, the majority of advisors are still at large banks and wirehouses, where the technology remains antiquated.
“For them to be able to make the changes and customizations they need to keep up takes massive investment for them to change course,” Lenz said. “The inability to be nimble is what ultimately prevents those firms from making changes that would move the ball forward, whereas independent firms can be more nimble and have the ability to change out solutions without large-scale negative impacts or the learning curve associated with implementing a new system.”
According to the report, most advisors consider their existing tech set-up to be mediocre, at best. Just 35 percent of advisors said they have state-of-the-art or modern tech at their firm, while 65 percent say their technology needs some improvement.
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