If Michael Kitces’s Fintech Map is any indicator, advisors have a seemingly endless list of tech solutions to choose from.
How could the world need new technology when we already have more than a dozen risk analytics tools and 20+ portfolio management options? It turns out that it’s pretty easy to find situations where a new feature or entirely different product could massively benefit a firm’s advisors.
Even with all the existing technologies already available, you may find yourself wondering why there is no automated solution for the multiple manual processes that suck up your firm’s time every week. Or maybe you have a new idea for a piece of technology that no one else seems to be doing?
When it doesn’t seem like the perfect technology solution is available to buy, organizations often look to the other side of the equation, which is to build a custom solution for themselves.
But making the leap from looking for a solution to building a solution requires a lot of planning—and even more faith.
If this is a conversation happening in your firm right now, we’re here with four things to consider when trying to decide if it’s time to create your own system.
1. Your Vision for Your Firm
The current crop of tech solutions exists for a reason. Every tool was born out of necessity or someone who saw an opportunity to fill a void.
While existing tech solutions can help build efficiency in your firm, they can also come with their own set of limitations. Even niche tools are often designed to serve as broad of an audience as possible within their unique subset, so you may find yourself bumping against the ceiling of what you can do with your current solution.
If that’s your situation, you may find yourself ready to make a $52 million bet on new technology.
Depending on the number of advisors on your team, the impact of a customized solution can be exponential when combined across every client relationship at your firm.
But a $52 million decision isn’t in every organization’s budget. And even if it is within range for you, cost is far from the only consideration when you need to decide on the most valid path for new technology.
2. Features
Sometimes, existing tools can only take you so far. There have certainly been situations where a company reached the point of growth where there was no way around the need for a customized solution that only they could make.
You might feel like your organization is at that point now. The change you need might be big, or it might be small.
Maybe you need a different UI or even all-new features to support your specific processes. Or maybe your Salesforce instance needs modular solutions with advanced customization capabilities.
Just because you can’t find a solution with everything you need out of the box doesn’t necessarily mean you’ll have to build it from scratch.
Enterprise-level solutions often cater to the customization levels needed by most firms, so take some time to explore the tools that are in the ballpark of what you’re looking for to see how they can be modified to suit your needs.
You may find that you can buy an existing SaaS solution, and then build on top of it to get to where you want to go.
3. Time
If you hire your own product team in-house to build your custom solution, it’s reasonable to expect the project from start to finish to take a year or more, depending on various factors.
With the many different system integrations and industry regulations that financial institutions have to deal with, it’s safe to say you may fall on the longer end of that spectrum.
We don’t say that to be discouraging, only to bring up an important question: How long can you make it without a fully-built custom solution? If you don’t have measures in place now to suit your needs, you may need to create some stopgap processes.
If you need the solution sooner than later, then that brings us to our last factor to consider.
4. Money
The upfront cost for building a custom solution can easily push well into six figures and beyond. Once you’ve built the solution, you will have ongoing upkeep costs to consider, such as data storage, maintenance, and more.
Consider one of the most basic yet most time-consuming aspects of an advisor’s job: opening new client accounts. Between your advisors, back-office, admin, and postage costs, the list goes on and on.
Multiply the cost per hour for each new account by the number of new accounts opened every month, and you may find that onboarding new clients cost you more than you realized.
You need technology that equips you and your team with the tools necessary to be productive and profitable. There’s nothing wrong with spending six figures to get your technology right so you can grow even faster and scale service while you do it.
But the decision doesn’t have to come down to only buying what’s on the market and settling for the limitations, or dedicating the time to build your own.
At Skience, we think there’s a third option: Buy and build.
Financial organizations have been limited by the idea of limited choice for too long. When you’ve arrived at the point of considering if it’s time to commit your budget to building new technology, there may be a way to repurpose your budget and take your dollars even further so you can get a larger return on your investment.
The Skience wealth management platform has been designed to fit that need and give you the best of both worlds. You can make a single investment in a unified wealth management system that comes ready for you to implement and refine existing processes, but we also have the skill and resources to help you build in the custom solutions you need to take your technology even further.
The best option for modern firms is to embrace this third option so they can stand up their new technology faster, and get to enjoy its benefits as they continually customize it to position themselves for the rapid changes we’re experiencing in wealth management today.
Get the wealth management platform that grows with you. Skience helps firms of all sizes build customized solutions so you can save time and money across every client relationship.