Financial advisers need CRM to do more than store client details

Financial advisers must understand their customers. (Image source: 123RF)

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Financial advice has always been a relationship business. But increasingly, the technology sitting behind that relationship determines how much time an adviser actually has to spend with clients.

The problem is not a lack of information. Financial advisers typically have plenty of it. Client details, investment information, correspondence, meeting notes, compliance records, financial plans and portfolio data may all exist somewhere within the business.

The problem is bringing that information together and turning it into something useful at the moment the adviser needs it.

This is the thinking behind Maximizer Financial Services Edition, a version of Maximizer CRM designed around the way financial advisers and wealth management businesses work.

The traditional view of CRM is relatively simple: it is where a business stores its contacts, records interactions and manages opportunities.

Financial services requires considerably more.

An adviser needs to understand not only who the client is, but their financial circumstances, risk profile, life stage, preferences, previous interactions and the broader history of the relationship. They also need to know what has happened, what needs to happen next and whether important actions have been completed.

This is why modern financial services CRM is moving towards a much broader client view.

Maximizer Financial Services brings client relationship information into a central environment where advisers can manage client profiles, interactions and activities while segmenting their client base according to criteria relevant to their practice.

It also provides the workflow layer needed to connect CRM with the other systems advisers rely on, including financial planning, portfolio management, reporting and compliance applications.

This matters because administration remains one of the biggest drains on adviser productivity.

Research presented by PwC Canada on the future of wealth management describes an industry moving away from advisers acting as administrative co-ordinators towards becoming relationship-focused advisers supported by automation, AI and integrated technology.

PwC estimates that redesigned workflows could return 10 to 15 hours a week currently spent on meeting preparation, note-taking and follow-up administration to advisers.

That is a significant amount of capacity.

Consider a typical client review. Before the meeting, an adviser may need to look through previous correspondence, check outstanding activities, review client information and prepare discussion points. After the meeting there are notes to capture, actions to assign and follow-ups to schedule.

Much of that work can now be assisted or automated.

Instead of relying on an adviser to remember every action, CRM workflows can create tasks, schedule follow-ups and provide a consistent process across the practice.

The objective is not to automate the adviser. It is to automate the administration surrounding the adviser.

Artificial intelligence adds another layer.

Rather than searching through years of notes and interactions before speaking to a client, AI can help summarise the information already held within the CRM and bring important information forward.

For an adviser preparing for a meeting, this could mean quickly understanding recent interactions, outstanding matters and relevant client history instead of manually working through multiple records.

The broader industry direction is towards AI-generated meeting briefs, automated meeting summaries, follow-up task creation and more proactive identification of client needs.

This changes CRM from a system that primarily records what has happened into one that can increasingly help advisers determine what should happen next.

Financial services also introduce a requirement that does not exist to the same degree in many other industries: virtually every important client interaction takes place within a regulated environment.

Compliance therefore cannot simply be an additional system advisers visit after doing their work.

A well-designed financial services CRM creates an auditable history of client interactions, activities and decisions while allowing compliance requirements to form part of the workflow itself.

Client information such as know your customer (KYC) details and risk levels can form part of the client record, while processes and required activities can be structured so that important steps are less likely to be missed.

This is particularly important as advisory businesses grow. Processes that may work when an adviser manages a relatively small client base become increasingly difficult to control across hundreds or thousands of relationships and multiple advisers.

Few financial services businesses operate on one technology platform.

There may already be specialist systems handling portfolio management, financial planning, reporting, compliance and other functions.

The role of CRM is therefore not necessarily to replace those systems.

It is to become the relationship and workflow layer connecting them.

Integration allows information from specialist applications to contribute to a more complete client view while giving the adviser a familiar place from which to manage the relationship.

That is also why an open approach to integration is becoming increasingly important. Financial services technology will continue to change, and firms need the ability to connect new applications without rebuilding their entire technology environment.

There is an apparent contradiction in the direction financial services is taking.

The industry is adopting more AI, automation and digital self-service, yet the adviser's human relationship with the client is becoming more important rather than less.

In reality, the two developments are connected.

If technology handles more of the repetitive administration, information gathering and routine workflow, advisers have more capacity for the things technology cannot easily replace: understanding a family's goals, explaining complex decisions, reassuring clients during difficult markets and building relationships that may continue across generations.

The financial adviser of the future is therefore unlikely to be replaced by technology.

The more likely outcome is that advisers using integrated CRM, workflow automation and AI will have considerably more time to advise.

And in a relationship business, that may prove to be the most valuable technology benefit of all.