Our From the Desk of the COO series features stories, strategies and solutions from GeoWealth’s Chief Operating Officer, Jack Hannah. This ongoing series will provide insights for those working in, or heading up, back and middle offices. Enjoy these views from our resident Operations Guru, Jack!
Jack, what are the biggest changes you’ve seen in RIA operations over the years?
Picture this: It’s 2008. I’m at my desk in the server room, right next to the massive computer our RIA is using to run PortfolioCenter. For the uninitiated, PortfolioCenter is a desktop-based software that’s been around since I was in middle school. Thinking about the amount manual data entry and reconciliation from those days still keeps me up at night.
If an advisor wants to see someone’s account holdings? They walk down to the server room and ask me to go into PortfolioCenter to run a report – which comes from data that arrived in the middle of the night and is hopefully (manually) reconciled by an acceptable hour the next day. And if they want to trade? Adding something as simple as a 2% position of Apple to multiple client accounts was a proverbial (not to mention manual) nightmare. That process required running and exporting reports that then needed manual Excel manipulation before placing trades at the custodian.
Let’s not forget the 2008 client experience, either. If a client wanted a holistic picture of their accounts – let’s say their Charles Schwab accounts, their 401(k), their outside bank accounts, and maybe a few alternative investments – they can probably piece that picture together by synthesizing several different, dismal-looking reports from a multitude of places. But no chance there was a way to get all that data into one report.
Fast forward to today
Cloud-based software solutions have ushered our industry out of its manual dinosaur days into the more sophisticated, automated, flexible, and efficient modern era of RIA operations.
Take trading, for example. With GeoWealth’s proprietary technology, making that same 2% Apple change takes our advisors about 10 seconds utilizing our model management tools. They simply request changes to the model allocation via the Model Center in our platform and click submit. That update is propagated out to every account holding that model. Someone on our Trading Team then creates a block trade to send to the custodian and works the orders. All the RIA had to do was click a couple of buttons, and then it’s efficiently taken over by our team leaving the advisor free for more productive uses of their time.
Billing, too, used to be rigid and inflexible. Advisors would spend way too much time to run billing for their book of business – often via an Excel spreadsheet. Now, technology, like what we’ve built at GeoWealth, enables RIAs to apply nearly any type of billing spec that might exist to their clients. While GeoWealth runs billing for our clients, even RIAs still doing everything themselves have a much easier time now thanks to significant advances in billing software.
Plus, client portals have transformed the client experience. Instead of trying to pull account information together from different places, clients can simply log in to their portal and see everything together in one spot. GeoWealth’s portal and app are white-labeled, so the end-client just sees their advisor’s branding, we’re quietly in the background.
Helping your firm evolve
Overall, the industry has made tremendous strides in automating and streamlining what were once very manual and tedious processes. It’s been astounding to see the change in technology from when I started out in 2008 to today. As advisor expectations shift, GeoWealth stands at the ready to bring continued advancement to our TAMP and to seek out integrations with industry leaders, such as 55ip for tax-smart tech or Pontera for trading held-away accounts.
If you feel like your firm is still using 2008’s tools and are curious to see what new tech is out there, let’s talk! Our team is available to give you a personalized demo of our platform so you can see where your firm can tap into great efficiency of scale and time-savings.
Until next time! Thanks,
P.S. Got questions? Want to chat through your current operations headaches? Hit me up at jack.hannah@geowealth.com.
MORE IN THIS SERIES:
- PART 1: My Path to COO and What I Learned Along the Way
In the first installment of this series, I detail the journey from my very first job right out of college on the bottom rung of an RIA firm to my position now as Chief Operating Officer at GeoWealth and everything in between. - PART 2: The Top 4 Operational Bottlenecks at RIA Firms
In this article, I identify the four most common operational roadblocks I’ve seen get in the way of RIA scale and growth, as well as how to address them. - PART 3: 3 Operational Risk Factors Creating Liabilities for RIAs
Operational risk factors can cause significant – and expensive – liabilities for RIA firms. Here are the top three biggest offenders. - PART 5: In-house vs. Outsourced Middle Office Operations
As firms grow in complexity, add new advisors, and introduce more sophisticated investment strategies, managing trading in-house can become cumbersome at best and risky at worst. - PART 6: The Power of Sleeving and Unified Managed Accounts
Sleeving, or housing multiple models in one account, enables advisors to consolidate a client’s investments, reducing their operational challenges and simplifying reporting. - SEE ALL
