How to best manage change, align teams, and implement technology following a M&A

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M&A activity in the RIA space has been shattering records for several years. However, in 2022, M&A deal volume hit a new high and many firms face a challenging road ahead to handle the near-overnight growth. That means onboarding advisors, transitioning portfolios, and scaling without missing a beat.

A big part of that process is choosing and implementing the right technology that will work best within your merged organization. We know what that’s like. As a technology leader in the RIA space, we’ve seen, heard, and experienced it all as we helped firms combine their tech stacks over the years. We also transitioned similarly when the award-winning rebalancing and trading software, formerly known as RedBlack, became part of the intelliflo family, now known as intelliflo redblack.

We’ve learned, and continue to tell our customers, that success following an M&A does not entirely rely on choosing the right technology to move forward. Instead, it’s more about managing the change, implementing the tools, and using them daily to drive the business forward.

Here are a few things to consider on how to manage change best and successfully implement your chosen technology.

Deciding on a centralized vs. localized approach

From the beginning, you’ll need to do some due diligence to fully understand how and where your tech stack will combine within your firm’s culture. In other words, how autonomous will your different offices be? Will you let them use the platforms they used before, or make them change to yours?

We always ask our customers going through M&As about their approach: centralized or localized. It often takes time for advisors or teams entering another established organization to get through the weeds of assimilating and adjusting to the change they were not necessarily asking for. It’s essential to understand how a tech stack melds with your culture.

Keeping and hiring the best talent

The strength of incentive plans, growth paths, and partnership tracks has upped the stakes for attracting and retaining the best talent. However, this is also becoming table stakes as we see more firms offering similar packages.

Acknowledge that internal tools are just as necessary as the tools you use for your clients. An employee won’t want to stick around for a sub-par digital experience any more than a client will. When hiring, understand whom you are looking for. Everyone wants top performers looking to move up. Many advisors look to hire a team that looks like and wants the same thing they do. But that’s not always the best.

That’s why diversity is critical—not only demographic diversity but also diversity in career goals and aspirations. For example, do you need a rockstar performer that may outgrow their responsibilities within a year or two? Or do you need to widen your bench and hire a solid anchor that wants to grow within the role and has a longer trajectory for stability within the group?

Choosing and implementing technology

M&A activity can introduce greater complexity into the business, where technology can become either an impediment or an integral part of advisor productivity, client retention, and business growth.

Besides having robust HR systems for employees to access information on their benefits, incentives, performance, and career growth opportunities, there’s also the CRM system to drive client engagement and platforms to maintain a digital client experience.

And it all starts with data to drive that—the ease of loading and consolidating data, updating client information, and ensuring the middle- and back-office teams can easily create the right experience for your clients.

You’ll also want to assess the ease of integrations or the seamlessness of all-in-one platforms. For example, how integrated is your technology? What is the effort required to open a single account? How many times does your team have to input the same data?

Top 5 things to ensure a smooth tech implementation

How you communicate with your team and bring it all together is as important as what you choose to do regarding technology. Here are five tips:

Manage and communicate change: Understand that change can be challenging, so sharing and managing change is critical. For example, are you taking teams that have worked autonomously and combining them without communicating information at every level? Sometimes, tech vendors are the ones giving your new team members the bad news that they can no longer use their tech platforms. Wouldn’t you instead prefer that message come from you?
Be clear and keep your promises: Overpromising or creating confusion about how advisors will be able to operate in the future is very common. Instead, be clear and concise about how you will operationalize once the acquisition happens. If your team is left with the impression that they can keep doing what they’re doing—like using their own models or trading system—when that isn’t true, their trust in you will take a hit.
Involve all stakeholders: Often, end users are kept out of project planning and implementation. This is a mistake. Your in-house implementation team should include all stakeholders, from the decision-makers all the way down to the people who will be using the system every day.
Document all your workflows: Often, workflow documentation is completed as you work through your setup—or done at all. Your tech vendor should be able to help with this. Leverage their deep knowledge of your system and best practices when building your workflows and processes, which will likely change after an M&A.
Lean into change: You decided to merge or acquire another practice to grow—but wasn’t it also to improve how your organization operates? Don’t try to fit a new solution or a combined team into the same box you lived in before. Acknowledge that change may be painful. But it can be a good thing, too, when it means better scalability, more efficient workflows, and smoother operations. Set goals and ensure everyone understands them—then lean into making them happen.

Look to your valued partners

Your technology providers are more than just vendors. And there is no one-size-fits-all approach to managing change and implementing technology after an M&A. Know that your best partners have seen the best and worst of technology implementations following M&As or organic growth.

At intelliflo redblack, we have a seasoned customer success team prepared to dive in and consult with you on your path forward, from evaluating and consolidating data from multiple sources to providing recommendations on workflows, migrating systems, and training advisors.