Tech Stack?!?

I don’t think it would be at all provocative to say that technology is improving our ability to give our clients significantly improved financial planning experiences. From CRM engines that help us remember the names of their cats, financial planning tools that print out fancy looking reports and aggregation engines that put all their stuff into a single pot, it feels like we’re almost able to replicate a very intimate, very time consuming, one-on-one relationship, en masse.

For a moment, let’s take a step back and consider the specific value that each component of your “tech stack” adds to your value proposition to the client. In the most basic sense, if you only had one, or even ten clients, your need for supporting technology would be greatly reduced. Sure, you’d need to fire off a few emails, but you’d have time and capacity to make them highly personalised, maybe even handwritten, to show the intimacy of your relationship. Your ability to remember their birthdays could be run out of a hardcopy calendar (or your head) and you could literally figure out their financial plans with an HP10B calculator and a protractor. It seems like there is a direct correlation between the number of clients we need to service and the integration of technology in our practices.

I do wonder what came first though, the chicken or the egg. Did we first get the tech and then increase the number of clients we had, as it gave us the ability to scale our service offering? Or, did we always have plenty of clients, we just used to give them shittier service? I suspect it was the latter.

I do believe that clients have been getting better service as technology has slowly started seeping into the operational processes of our practices. We are able to keep better track of client portfolios; schedule more regular face-to-face meetings with them; send regular reports and so on. The thing that sticks out for me though, is that most of the tech we have integrated into our practices seems to be focused on making the back-office operations more “automated” and seamless. This did have an improvement for clients but I don’t believe it “revolutionised” their experience. They went from getting a report in the post every other year, to having one every other month. A new business application went down from three weeks to a couple of days and our ability to build a comprehensive plan reduced from two days to a couple of hours. No doubt there were improvements, just maybe we should’ve been doing those things anyway.

Thinking about the face-to-face, or the more intimate part of the overall experience, it feels to me like there has been very little change. In particular, the client engagement piece of our proposition has remained largely untouched. We still rely on the same discussion documents, visual aids, graphs and dashboards. Planners still struggle to get client’s to connect with their plans. We still struggle to get clients to understand and feel emotionally invested in the process.

I think this is in part due to where we have focused in our own practices – how we have introduced technology into them. My sense is that the “tech stack” that advisors have built in their practices has been focused on very operational and analytical outcomes. We’ve found it easy to justify the business case for change where automation, efficiency and scale are sitting in the driver’s seat. We find it less easy to find a space for technology that doesn’t fit into these categories, although confining ourselves to these categories creates a massive gap in the infrastructure required to deliver value to your clients.

I think we need to redefine the framework by which we evaluate whether our operations and “tech stack” adequately support the value proposition we want to put out to clients. As discussed in a previous article, successful financial planning must make an appeal to the client’s Heart, Head and their Hand. By “Hand”, I mean we must appeal to their orientation to take action; “Head” means the numbers need to stack up and make sense; and by “Heart”, I mean we have to make an emotional connection to bring all the elements together. So if you assess the tools in your practice, do you have supporting technology in each of these spaces? CRM tools will tick off the “Hand”; planning tools, the “Head” but what do you have for the “Heart”? How has your engagement process evolved with the advance in technology to help you to make better connections with the Heart, if at all? A major oversight in the propositions I see in the world today!

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