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  • Home>Practice Management>Practice Builder>Buying Software That Helps, Not Hinders

    Buying Software That Helps, Not Hinders

    Whether your software purchase is a big or small commitment, make sure it is the right one.

    Helen Modly, CFP, CPWA and Tiffiny Dimel, 08/10/2017

    Sometimes choosing the right technology is easy. You have a need and, a few Google searches later, you have a solution. Other decisions, however, require a more thoroughly researched approach, especially when they involve software that is going to be client-facing or a core part of your day-to-day activities.

    Define your needs
    Just as we tell our clients that every dollar has a job, so too should the software you are preparing to buy. Write out your needs and wants with as much specificity as you can so you can approach the purchasing decision with clarity. Also, try to quantify your needs where possible. These requirements should be measurable, such as, "I want to be able to capture a prospect's information in less than two minutes," or, "I want to input my client's financial information once during the creation of a financial plan and have it flow through to all materials presented in the plan."

    Differentiating between your needs and wants will help ensure your search for the right solution stays on track. It is easy to get distracted by shiny features that do not actually fill your original needs.

    Think about your current pain points and what your ideal process would be to solve them. It doesn't matter if your solution seems feasible or not; technology is evolving so fast that a solution you just haven't discovered yet may indeed exist. Get creative while being as precise as possible.

    Listen to the crowd, but don't follow
    Reach out to your peers for recommendations and reviews regarding the products you are considering. If you need more sources, ask prospective vendors for the names of customers who are willing to talk to you about their implementation experience. Discuss your current needs and pain points, and ask for an honest appraisal of whether the software meets their own goals. Ask about their least-favorite element of the product to make sure it's not the feature you are expecting to address your highest-priority issue.

    One of the worst reasons to buy certain software is because the majority of firms you know is using it. Switching technologies is time consuming, expensive, and frustrating, and most advisors avoid doing so for those very reasons. Being the popular option is not reason enough for you to adopt it. Stay objective.

    Choose workflows over features
    While financial technology products race to find the all-in-one, magic-bullet solution for advisors, feature bloat becomes a real concern. While it would be nice if your CRM solution automatically pulled up your clients' records when it registered an incoming call from their phone number, it is more important that the software tracks the onboarding process of new clients or the opening of new accounts by the clients you already have.

    Is it preferable that your rebalancing solution contains an easy way to check or display a client's current tax bracket, or would you rather see year-to-date realized gains? Would a process to acknowledge that cash has been raised for an upcoming withdrawal or a new feature that does not save any appreciable time have more value?

    Helen Modly, CFP, CPWA, is a wealth advisor with Buckingham Strategic Wealth, a fee-only Registered Investment Advisor. The opinions in this article are the author’s own and may not reflect the opinions of Buckingham Strategic Wealth or Morningstar.com. The author may be reached at nova@bamadvisor.com.

    The author is a freelance contributor to MorningstarAdvisor.com. The views expressed in this article may or may not reflect the views of Morningstar.