Spring Series: Advisors’ Top Two Efficiency Drivers

Posted by Andrea Collatz on March 22, 2012

Welcome to the first post in the spring series of “EVOLVE the RIA Growth Blog.” Over the next couple of weeks, we will feature posts that share spring themes including – growth, evolution, new beginnings, and fresh perspectives. Subscribe today for new updates.

For advisors looking to grow their practice, making improvements in efficiency is often the answer. There are many areas to consider when making efficiency improvements, from routine administrative tasks, to technology, to the investment management process. 

With seemingly unlimited options for improving efficiency, the real task is often to determine which enhancements will result in the biggest gains for the practice. Many advisors are looking for enhancements that will help them cross their growth conundrum and achieve new levels of growth.   

So which efficiency enhancements give advisors the most bang for their buck? Trust Company of America set out to find the answer to this question and commissioned Advisor Impact to conduct a study among RIAs nationwide. The results offer some insight into the key efficiency gaps advisors experience.

According to the study, the top two drivers of efficiency are:

1.   Using technology effectively 

Of the firms surveyed, firms sized $100M+ AUM are the most likely to feel that they already use technology effectively. In a classic chicken or egg scenario, this could be because larger firms have the capital to invest in technology enhancements. Or, it could be due to the fact that larger firms have grown to their size because they use technology effectively. Either way, technology is clearly instrumental to efficiency.  

2.   Streamlining routine processes

Again, firms sized $100M+ AUM were the most likely to feel that they are already effectively streamlining processes. The activities advisors are most likely to have a defined process for include: regular client performance review meetings, setting client meetings, and follow-up on client meetings. While many advisors have processes in place for a range of activities, the research suggests that few advisors are actively using them.

With technology and streamlining routine processes emerging as the primary drivers of growth, advisors should give greater attention to these two areas in their firm. The key is not just to have technology or processes, but to use both of these important growth drivers consistently and effectively.

To learn more about the study’s key findings and how your firm compares to the industry at large, read the full study findings now.

Download the efficiency study findings.   

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