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Scott Gallacher: Back-office to the future

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Given that a large part of our work is dealing with investments and thinking about the long term, I am sometimes surprised when I talk to advisers who fail to invest in the future of their own businesses.

A recent conversation with one of these advisers prompted me to reflect that one of the really vital investments adviser firms should make is in having a truly excellent back-office system in place.

My managing director Alan Turton took the decision over 10 years ago to put in place Adviser Office by Iress. At the time this was a major decision – we were still a relatively small firm and it was quite expensive, both in terms of initial costs and ongoing monthly fees.  However , Alan reasoned, quite rightly, that its use would save us money by avoiding the need to recruit an additional admin person. Over the years this foresight has been crucial to our success.

It has allowed us to become “paperless”, with scanned documents recorded as diary entries.  Apart from the small time cost of creating the diary entry, there is no additional cost. This has allowed us to get rid of over 30 filing cabinets, which in effect were costing us thousands a year in rented office space.

It is not just the cost but the accessibility. With all client data being held securely (and independently of any provider) in one place, we are far more efficient than we otherwise would be.  We have the ability to recall all interactions, letters, emails and phone calls in one place.

An important aspect is how it integrates with other systems. Various online quote systems are linked, prefilling client data, saving time and reducing the chance of errors. The quotes can also be saved directly onto the system for future recall.

Valuations for many plans, whether held directly or on a platform, are automatically updated weekly or daily. Most other plans can be done in minutes, with a couple of clicks taking you directly to the provider’s online valuation. Fund prices for all holdings are updated daily via a Financial Express link.  This fund data also allows you to link to research tools such as FE Analytics, allowing you to carry out a portfolio scan in less than a minute and can be a godsend if your client should ever turn up a day early to a meeting.

For those that make use of cashflow financial planning, our system offers integration with Truth’s financial planning software, thereby avoiding the need to duplicate data entry. Some checking and tweaking may be required but this is still much quicker than having to key everything in.

Finally, all our commission receipts are logged onto the system, some of which is automatically done via e-commissions, and matched up to the specific policy and client. This makes our management reporting (Gabriel, KPI, TCF, BRAW, and so on) almost effortless -– taking minutes rather than days (or even weeks as claimed by one adviser).

All these various benefits help enormously in the day-to-day running of our business – but should also help for those who are looking to exit their business at some point in the future.

A good back-office system can increase the value of your business by making it much easier for any potential buyer to assess what they are receiving. Even if the prospective buyer uses a different system, they should be able to migrate data across easily, saving staff being tied for weeks trawling through paper files and keying clients onto a new system.

In summary,  your back-office system should be viewed as  an essential tool saving your business valuable time and allowing you to achieve the very best sale price in the future.

Scott Gallacher is director of Rowley Turton

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Comments

There are 2 comments at the moment, we would love to hear your opinion too.

  1. So endeth the advert for Adviser Centre – other back office systems are available.

  2. Maybe its just me. I am a sole trader and my back office systems are: A computer, a duplex scanner, external hard drive with a ji-huge memory, internet and email. I too scan everything and when I know I am going to do a review with a client I email all relevant providers for valuations form a forward diarised alarm on Outlook (those who don’t have an online valuation facility that is). It takes a few minutes to do this as the template emails are there and all i need do is fire in plan numbers. Obviously for platform biz it’s really easy. For a typical client it takes me around 10 minutes to get the review meeting “paperwork” ready so its no big deal. I for one do not need something with weekly valuations done automatically – indeed I do not see the point of it but that only my own opinion. if it works for the author then thats great nobody should knock that but I do have to say the important thing is to use a system that works for how you run your own business. I really don’t see the need to invest heavily in new stuff that, on the whole I don’t need however we are all different.

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