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Jalina Kerr of Schwab.

Technology > Investment Platforms

8 Steps Advisors Can Take to Improve the Client Experience

By Jeff Berman

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There are several steps that advisors can take to improve their practices and thrive in 2023 despite continued market and economic uncertainty, according to Charles Schwab.

Many of those steps are tied to technology and making sure advisory firms are taking full advantage of the digital solutions available to them, Jalina Kerr, managing director of client experience at Schwab Advisor Services, told ThinkAdvisor during a recent online interview.

Digital modernization should be at the top of advisors’ agendas and, according to data analyzed from Schwab’s Technology Adoption Dashboard, many RIAs have already made significant progress on that front, the company says.

But there is still plenty of room for improvement, according to Schwab.

During the interview, Kerr discussed that and other Schwab findings and shared her insights on RIA technology trends she expects to dominate the rest of 2023.

“What is really a challenge for all of us is that, as digitization grows, we can’t forget about the human side of it,” Kerr said. Those things have to connect. Right now it can feel a little bumpy when you’re bouncing back and forth from the human channels to the digital channels.”

She added: “It starts to become a very tangled web that advisors have to sort out because, at the end of the day, this business is a relationship business. The trust that you build with your clients is a human thing and an emotional thing. How you weave that together more seamlessly with digital and technology is the only path forward.”

Below are eight things she said advisors can do to help their practices thrive.

1. Make smart technology investments.

With the market outlook remaining uncertain, smart investments in technology may have an outsized and long-lasting positive impact on advisors’ practices, according to Schwab.

For starters, it’s important to make sure they’re keeping their digital solutions modern.

“RIAs have certainly been widely adopting technology over the past few years” and the “amount of momentum we’ve seen over the last year or two has been pretty compelling,” Kerr told ThinkAdvisor. But there is much more work to do, she said.

2. Make sure you’re supporting the most popular digital initiatives.

Digital money movement and digital client onboarding are two of the most popular digital offerings so far, and advisory firms should make sure they’re taking advantage of them.

“We saw 98% of the firms on our platform used that move money feature at some point in 2022, which was really quite interesting when I think about what it used to look like, even just a few years ago,” Kerr said.

Digital client onboarding is obviously a “more complex process for a client,” she went on to say. “Giving us all their account information, funding the account, making sure that all of the attributes that they want associated with that account are set up accurately. So it’s certainly a more complicated workflow, but the fact is that 80% of advisors on the platform used our digital onboarding tools in 2022.”

Schwab’s digital onboarding tools have only about a 4% rework or not in good order (NIGO) rate versus paper or analog, which has an over 30% rework rate for advisors, she said.

So digital client onboarding offers “efficiency for them when they can use that tool and also creates a better client experience,” she added.

3. Try to create repeatable processes.

“Many firms have made significant progress and have found a way to create repeatable processes,” Kerr told ThinkAdvisor.

But firms need to make a “real, concerted effort to make that change sticky and there has to be a real plan behind it,” she said, explaining: “It’s one thing to say ‘we’re going to adopt this technology’ but the framework of following through on that, measuring it, rewarding the behaviors, it’s classic change management.”

That, however, is the “part where it becomes the hardest because it’s changing human behavior to adapt to what the digital tool will provide for you,” she said. “Sometimes that can be met with some level of resistance.”

4. Invest in proof points.

Sometimes when a new process like these digital ones get “introduced, there’s fear that, because it’s unknown, it’s not as controllable,” she noted. “You don’t know exactly how it’s going to show up in reality.”

Therefore, “I think that’s a place where advisors have to think about how to invest in proof points that will show them exactly how the flow is, whether it’s through a digital marketing tool or work,” she said.

Sometimes, “demos or videos of how a process should look so that the people handling that can gain confidence in it and feel like they can get behind it,” she told ThinkAdvisor.

Smaller firms, however, are “adopting at a more rapid rate because they only have to convince themselves or maybe one other person,” she said, adding: “They can see right away the benefits it’s going to provide to them.”

5. Consider hiring people who focus on tech.

Some firms are investing in “their own data lakes [and] their own tech people who do nothing but data analytics and business intelligence,” Kerr said.

This is a “really big area of broken opportunity for the industry,” she noted.

6. Remain focused on your clients.

One thing that is crucial amid all these changes and market uncertainty is “making sure that we stay focused on our clients,” Kerr said. That is certainly the case with Schwab as it goes “through the integration and through the conversion” of TD Ameritrade broker-dealer activities that are slated for this year,” she noted.

“That is certainly an area where advisors want to make sure that we’re paying attention to all aspects of the business and all aspects of the custodial support,” she added.

7. Focus on providing value to clients.

“At a time when costs continue to rise, there continues to be a great focus on value and making sure that advisors are delivering the lowest cost alternative to their clients while still maintaining their fiduciary responsibility,” Kerr went on to say.

“I think that’s going to continue to be under pressure or under a lot of visibility given a lot of the market fluctuations that we’re seeing right now,” she said. “So I think advisors really have to stay the course on showing that value [proposition] and showing their fiduciary responsibility on low cost investment selections.”

8. Provide clients with more customization.

Customization is “obviously another big trend in the marketplace right now,” Kerr said.

Jeff Berman

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