Don’t blame the software

As a business grows and enters the next stage of development it is typically seeking ways to differentiate its service and streamline its operations, all within the context of being compliant.

The effective use of software can add significant value to a financial planning practice, increasing earnings before interest and tax, reducing risk and thus increasing the capital value.

However, switching to a new financial planning software product can also lead to months of disruption and reduced productivity if it is not well planned from the outset.

Much like any construction, you need to lay the correct foundations in order to build a solid base with which to support your business requirements immediately and in the future.

While the choice of software product is an important decision, it is rarely clear-cut.

There are several proven products on the market and their features and functions will inevitably leapfrog each other over time.

The issue is not so much the selection of a particular product, as determining what a practice wants from the software and then tailoring it to suit the way the practice does business.

A licensee or adviser is far better off making a quick decision on the software product (a key aspect being to select a product from a vendor who is committed to the industry and is aligned to the principal’s vision for their practice in the future) and then focusing their resources on how they are going to make the software work effectively in their business.

Gearing up

The first question to ask is what are you trying to achieve with new financial planning software?

For example, are you looking to maximise productivity through the generation of compliant Statements of Advice or review documents (a 40 per cent-plus productivity improvement is not unachievable), or are you seeking to deliver a first class client service with a commensurate level of personalisation and quality in all of your documentation?

The leading financial planning software products are even challenging the role of platforms, taking on the role of consolidated portfolio administration and reporting at a fraction of the price.

Too often, people are guided by what the software can do rather than what they want it to do.

Obviously, there’s an element of needing to understand the software’s capabilities, but typical ‘out-of-the-box’ implementations rarely scratch the surface of the true potential.

Once you’ve worked out the goals for implementing software into your practice, it’s time to think about how the business will need to operate in order to achieve them.

This invariably leads to some level of change, such as new business processes, new document templates, new division of responsibilities between advice and support staff, or even whole new service propositions — the possibilities are endless.

You should be prepared for some productivity loss in the short term while users are trained and become familiar with the new system.

However, you can expect this to be offset by the subsequent increase in control and productivity following implementation.

This doesn’t have to be as daunting as it sounds and can be greatly condensed by engaging external expertise.

The key is that these are business decisions, not technology ones.

Turning the ignition key

Once all of these questions have been answered, then you’re ready to ‘automate’.

Some practice management consultants have developed pre-configured ‘best-practice’ processes, document templates and ‘wizards’ that can be used to bootstrap your implementation.

These templates enable you to get up and running and start to realise benefits as quickly as possible, while also minimising the cost.

Driving the technology

Once your team has been using the software for a few months and has a better understanding of what can be achieved and how you would like things to operate, then you can look at modifying these templates to suit your specific needs based on informed user feedback.

One-on-one coaching and assistance as an alternative to the necessarily generic classroom training offered by software vendors can also prove beneficial, the aim being to ensure that by completion of the transition, every adviser and administrator is making effective and efficient use of the software.

To summarise, before you implement any software product, some important points to bear in mind are:

1. Are you clear about what you are trying to achieve for your business with the introduction of new software?

2. Do your business processes and the division of responsibilities reflect your goals or do they need some refinement?

3. Do your Statements of Advice and other client documentation reflect the proposition that you want to portray?

4. Do you have the time to invest in setting things up properly or should you be engaging external support?

Partnering with an external consultant to guide the implementation brings its own set of benefits, some of these are:

n experienced practitioners who understand the product and its capabilities can lead your thinking as to how best to realise your goals;

n the time taken to implement the system can be significantly compressed (particularly if the work would have been done part-time by internal personnel who must carry out the implementation as an adjunct to their normal duties);

n reducing the likelihood of errors resulting from ‘learning on the job’ (and the associated time and cost of re-work); and thus

n maximising the return from your investment.

In the fast lane

Finally, once the software is up and running it will need to be continuously managed and refined to ensure that business efficiencies are maintained.

Again, this is something that can be monitored in-house or outsourced; the most important thing is that it is done.

This way, the system is kept up-to-date with your work practices and you can ensure that advisers and support staff are making efficient and effective use of the product.

It’s not just about software; it’s about how to effect change. By taking the right approach from the outset you will avoid frustration and ensure that you maximise the return from your investment.