Since the COVID-19 pandemic, advisors have increased their use of technology significantly. While adoption has proven to be a boon to those practices that have incorporated such tools, the industry still has a long way to go, according to the latest Cerulli Edge—The Americas Asset and Wealth Management Edition.
Overall, Cerulli’s research finds managing technology needs remains one of advisors’ greatest practice challenges (29%). According to the research, the most frequently identified challenges to using technology include compliance restrictions that limit functionality or impose other limitations on advisors’ ability to use the technology (73%), followed by a lack of integration between tools/applications (71%), and insufficient time to learn and implement (70%).
There is an opportunity for the home office and financial technology firms to shore up the training and support they provide. “Many of the challenges advisors identify with using technology are challenges that can be overcome through knowledge-sharing efforts to educate and inform advisors about the potential power of more effectively leveraging the technology tools already available to them,” says Michael Rose, director.
According to the research, just half of advisors are satisfied with the training and support they receive. Larger advisor practices—who can more leverage more specialized technology and offer more total services to their clients—represent one of the most important market segments for the software vendors, broker/dealers (B/Ds), and custodians that are the primary provider of technology to these practices.
“Given the high importance advisors place on the technology available to them, it is critical that B/Ds, custodians, turnkey asset management providers, and other firms that provide technology platforms to advisors elicit sufficient and ongoing feedback to ensure the technology stack they offer remains aligned with the evolving needs of the practices they serve,” Rose concludes.
