SEI has issued a new white paper setting out the workflows necessary to boost a wealth management firm's value.

Systematic workflows “create the culture that ensures integration works” and are critical to boosting a wealth management firm’s value and client service experience, SEI says in a new white paper.

According to the report, entitled Workflows: The Key Ingredient to a Sustainable and Sellable Advisor Business, 54 per cent of financial advisors have not yet adopted workflow processes.

SEI told Family Wealth Report that “workflow” is: “a series of steps that document and potentially automate important business processes—from client acquisition to service. Workflows encompass the steps involved in a task, as well as the expected result or consequences. Automated workflows assign the task to the most efficient resource. The best workflows incorporate best practices and expected behaviors for those responsible for implementing them.”

The paper, which is based on a survey of around 500 financial advisors, claims that effective workflows can help transform advisory practices into sustainable businesses by creating repeatable processes, capitalising on data to identify successes and deficiencies, and optimising sales, services and operations.

“As client relationships become increasingly complex, the firms that embrace smarter ways to manage those relationships will be the firms that succeed,” said Raef Lee, managing director at SEI Advisor Network.

Lee continued: “Firms must focus on maximizing both their human capital and technological investments by embedding workflows throughout their key systems including CRM, financial planning and custody. The workflows facilitate a team approach, and once in place, can help transform the firm into a sustainable, sellable business.”

Doing it properly
Adding another dimension to the issue, the report suggests that many advisors who do implement workflows are “often not using technology effectively.” For example, SEI said: “Many advisors continue to execute even the most basic procedures manually, often relying on their memories.”

On this note, it was found that 58 per cent of advisors who have workflows in place still rely on memory, post-it notes, to-do lists or checklists when carrying out various tasks. Meanwhile, many are failing to measure their workflow process to determine its effectiveness, the firm said.

“Workflow integration is the key ingredient to creating an efficient and effective advisory business,” said Spenser Segal, chief executive at ActiFi, co-publisher of the report.

“Workflows not only provide a roadmap for how to deliver a consistent client experience, but the non-client facing activities can be orchestrated – from CRM through financial planning and proposal generation, all the way through the advisor’s custodial platform. Whether it’s a large or small firm, advisors’ success in increasing their firms’ value and ensuring a consistent client service experience may hinge on their ability to implement workflows,” Segal said.

Over half (57 per cent) of those surveyed feel they do not have the tools or processes required to help their firm's next generation of advisors succeed, while an identical amount said their current technology or workflow processes do not ensure a consistent client experience.

SEI said that, when asked to cite the primary barrier to keeping up with technology, the most frequent response from advisors was that they are focusing on daily operations (52 per cent).

Indeed, when asked to select their top five resolutions for 2014, 67 per cent of some 800 advisors polled by SEI at the end of 2013 cited “systematise internal processes to increase efficiency,” followed by “integrate technology to increase efficiency” (59 per cent).