Financial advisors surveyed for Investment Executive’s 2013 Brokerage Report Card are dissatisfied once again with their firms’ technology tools and back-office support, citing outdated software and problems with communication, respectively, as the main reasons for their discontent.
On average, advisors ranked their firms’ “technology tools and advisor desktop” at 7.8 overall; however, they gave this category an average overall importance rating of 9.0. The significant difference of 1.2 points between the two ratings – the largest gap in the survey – reveals a disparity between what advisors feel their firms are delivering and how important those tools are to the advisors’ practices. The dissatisfaction related to this gap is most evident among advisors with ScotiaMcLeod Inc. and TD Wealth Private Investment Advice (TD Wealth PIA), both of which are based in Toronto.
Despite efforts by management at both firms to upgrade the technology tools available to advisors, advisors with TD Wealth PIA gave their firm a rating of 6.2 in the category and an importance rating of 9.0 for technology, resulting in a gap of 2.8 points. This indicates that most TD Wealth PIA advisors believe that the firm’s technology is not up to their expectations.
“The technology is seriously lacking, which is time-consuming for the advisor,” says a TD Wealth PIA advisor in Ontario. “The software isn’t user-friendly and there are too many separate steps we have to take for opening accounts or transfer forms, for example.”
Some TD Wealth PIA advisors, however, have started to notice small improvements – and that, too, is evident in the rating, which increased by 0.4 of a point from 5.8 in 2012. In fact, TD Wealth PIA is in the midst of a three-year technology upgrade in which its parent bank is spending $75 million on new technology on both the banking and brokerage sides of the business, says Mike Reilly, TD Wealth PIA’s president and national sales manager. The upgrade includes a new unified managed-account platform and a compliance surveillance tool, as well as planned improvements for the customer relationship management and portfolio-management systems, says Reilly: “It has been a massive commitment and rollout.”
ScotiaMcLeod also has made a commitment to improve its tech tools, yet many of the firm’s advisors feel it’s too little too late. ScotiaMcLeod advisors ranked their firm’s technology at 5.0, yet gave the category an importance ranking of 8.5. This large gap of 3.5 points is due to the firm’s outdated tech platform and the perception among ScotiaMcLeod advisors that despite management’s repeated attempts to improve its technology, the firm has been incapable of doing so.
“They’re so far behind, and a long-term fix has taken years to be fully implemented,” says a ScotiaMcLeod advisor in Atlantic Canada. “I’m afraid these long-term fixes will never be executed and rolled out.”
But during the time advisors were being surveyed for this Report Card in January and February, ScotiaMcLeod implemented new advisor desktops for 700 advisors and advisor teams, says Hamish Angus, the firm’s managing director and head. The dealer also has been providing a lot of training and in-branch resources to help advisors use the new tools.
Similarly, “back office and administrative support” is another sore point for many advisors. The average overall rating was 8.0 in performance but 9.1 in importance – for a gap of 1.1 points, the second-largest in the survey.
Outsourcing and language barriers are two of the main problems advisors have with their back offices, particularly at Toronto-based BMO Nesbitt Burns Inc. and Montreal-based National Bank Financial Ltd. (NBF). “[The back office] has been deteriorating recently,” says an advisor in Ontario with Nesbitt, which saw its rating drop to 6.7 from 7.3 in 2012. “It’s taking longer for things to be sorted out, which may have to do with much of the support being outsourced to India.”
However, Bill Brown, Nesbitt’s national sales manager, counters that the outsourced portions of the back office should not affect the day-to-day workings of advisors. “There are some tasks that are taking place on an outsourced basis,” he says, “but they have nothing to do with the investment advisors themselves.”
And although NBF’s back office is based in Canada, many of its advisors are still disappointed, giving the firm a rating of 6.4 in the category, a sharp decline from 7.7 in 2012. NBF advisors say back-office staff lack accountability, as emails are frequently lost, and that language barriers cause communication breakdowns.
“There is a disconnection between what we need to do for clients and the ownership of issues,” says an NBF advisor in Ontario. “[Back-office staff] are unresponsive and need to improve. Also, the separation between English and French operation systems cause some obstacles for us.”
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