What does data quality mean for your financial advice processes?

The concept of big data is nothing new. It has been discussed in the financial services space for many years and over at conferences as organisations grapple with how they can best use the data they house to improve their businesses.
But, on a practical level, what does it mean for your financial advice business and how can business management technology help?

The insatiable appetite for data
Information has always been a powerful resource, but the modern world’s appetite for data is quite insatiable. Every minute across the globe there are over 241 million emails flying around, more than 6.3 million Google searches and 102MB of data produced by the average person… and counting.
Financial advice firms are no strangers to processing data. From personal details to financial and health details, it is all part of providing an appropriate service. But in the digital era, advisers have access to information like never before. Integrations with third-party tools and systems can pull in data from external sources to augment internal information and better inform decisions at both a firm and client level.
In addition, in these highly regulated times, holding quality data is crucial to ensure you stay on the right side of the FCA and the Information Commissioner’s Office (ICO). And it will pay dividends when collating information for your PII provider at renewal time. Maintaining accurate and reliable data and keeping it secure is a driver not just of success, but of survival.
Using data to underpin your advice process
Deploying the most proficient practice management tech can play a huge part in ensuring that you fulfil your regulatory obligations. It can also help you better manage your data and capitalise on its value, delivering better outcomes for your clients, improving your firm’s overall efficiency and increasing business revenues.
Data can underpin your advice process in several ways:
- Delivering a more complete view of the client
Suitability has always been at the centre of an appropriate advice service, but data is delivering a more holistic view of clients’ finances. Using technology enables a deeper analysis of assets and liabilities, goals and aspirations, opening up a wider range of strategies and solutions for the adviser and client to consider. Being able to access and analyse this information in one place helps financial advice firms deliver better outcomes for their clients.
- Creating smoother business processes
When you are confident that your data is reliable and consistent, you can increase automation across the advice journey, delivering straight-through processing in areas such as income matching and valuations to realise time and cost savings. Further efficiency is introduced by third-party integrations into your back office software, where data is entered once and then used across your tools without requiring further data entry.
- Driving business efficiencies
Many firms still find themselves constantly switching between systems – from their practice management system to an investment platform to the client portal, to a cashflow tool and back again. This ‘swivel chair effect’ leads to unnecessary friction and errors. Our marketwide advice efficiency survey found that firms spend an average of 45 days a year just on implementing financial plans. Integrating systems and processes to ensure there is a single source of consistent and accurate data, streamlines production and distribution of client documentation, without the need for re-keying.
- Easing compliance
Internal compliance checks are much easier with consistently formatted and gathered data, saving time and resource. In addition, when your data is in order, if you need to hand over access to the regulator, it can be done with confidence. Plus accurate data means less risk of mistakes, like sending sensitive information to the wrong client, which can impact your reputation and put you at risk of being fined for a data breach.
- Establishing repeatable processes
Once a consistent method of data capture and storage is established, processes can be implemented once and then repeated across the business. Again, this saves you time and money in rekeying information, while consistent data allows for easier integration of different systems and tools to create automated and straight-through processes.
- Servicing more clients
Better data leads to increased efficiency, greater confidence in the information you produce and more time to focus on the tasks that add value to your business, rather than being bogged down in admin. It will be easier to manage existing clients and onboard and service new clients, allowing you to deliver the same high quality service to more clients, increasing revenue for the firm.
When combined with accurate data, modern technology can deliver significant benefits to advice firms, from smoother internal and external processes, to more engaged clients and a more efficient and profitable business.
Get in touch if you’re interested in finding out more about how we can help make your data work better for you.