There are many reasons we seem obsessed with technology—in just over a decade we’ve seen the rise of the smartphone, the Cloud, and an increasingly connected world. It’s a fascinating time with more cool stuff on the way. But when it comes to your firm’s tech stack, it’s easy to make a mistake if you’re over eager about what technology might do to solve problems.
On this episode of the Elementality podcast, Reese Harper and Chad Jardine explain how you can make sure your technology is on target. Advisors often put technology before process. But technology won’t bring you the right strategy. Reese and Chad explain how you can make sure the technology you want is actually providing the right solutions for the strategies you should already have in place.
Podcast Transcript
Reese Harper:
Every time I would go to a meeting, even though I had a lot of different software to help me track their net worth, and I was using existing financial planning tools, I’m having to sit down, I’m having to manually type in data at meetings. I’m literally having to walk through an update to their situation in a piece of desktop software projected on my TV screen. It’s wasting all of my time. I want to be in that meeting asking questions about how their life has been. I want to get to the emotional jobs of financial planning.
Jordan Haynes:
Welcome to Elementality. I’m Jordan Haynes, Financial Planning Specialist at Elements. In this episode of Elementality, Reese and Chad talk about the advisor tech stack and how, as Reese puts it, if a tool will enhance your service or deliver more value to your end clients, it should receive more attention from you. As you listen, consider your current tech stack and ask yourself these questions. Will these tools replace me? Will they improve my current skillset? Or is this tool solving something I can solve on my own? Answering these questions will help you find tools that can enhance your value to clients. Enjoy the episode.
Reese Harper:
Welcome to Elementality, everybody. Here we are. Chad, the dad in the studio, Chad, the dad and tad in the studio. Excited here. For those of you who haven’t been with us before, this is an episode where we are taking an advisor question and that we’ve seen during the week, a concept or a problem we’ve seen during the week, from Jordan’s sales efforts and trying to expose a concept for us to talk about, for Chad and I to debate. So Chad, what do we have going on this week?
Chad Jardine:
Yeah, thanks for the intro, Reese. This is an interesting one. I’m going to put a caveat out there that this is a little bit shameless and self-serving, but-
Reese Harper:
But that’s your way of doing things.
Chad Jardine:
Well, yeah. The audience is getting used to me. What this is about is, in this business, in the work that people are doing, there’s a lot of technology that gets deployed. We use a lot of different tools. We use technology for as simple things as email or sending text messages to more complex things, different types of analysis, different types of reporting. And so, the real question here and these questions always synthesize feedback that we’ve had from our conversations with advisors is, how do you know when your technology is on target? How do you know when you’re using the right tools to accomplish the jobs that you have to do? And how do you maybe know if you’re not on target, if things aren’t right and a piece of technology could help you.
Reese Harper:
This is a good one. I know you’ve got a lot of thoughts on this, too. So, I want to get your perspective. One concept that I struggled with myself along the way, because I’ve had my own practice for quite a while, and when I look at all the SAS model subscriptions that I’m paying for, I was always wondering if I’m getting my money’s worth and if I’m using everything properly, and I learned pretty quick that there’s not going to be a point in time where one tool can do the breadth of things I would like it to do, and most tools that are well designed, know exactly what they’re trying to do, and they stay focused on that. It used to be-
Chad Jardine:
Doing one thing really well.
Reese Harper:
Really well. It used to be that, what I used to hear a lot 10, 12 years ago, when I’d go to advisor conferences. “Who do you integrate with? Who you aggregate with? How do you, I want to get them all working together. They all have to communicate.” And then I started thinking that’s important and so, I would always look for what are the integrations between different tools? Well, at the end of the day, sometimes an integration is important, but most of the time it’s just transmitting name and email, basic data that really doesn’t give you a lot of leverage.
Reese Harper:
You only have a hundred clients. How many times do you do to communicate email and name across platforms so that you don’t have to populate name and email in another system. And I think what ends up happening is, we kind of were in a desktop world where it was really important when the internet wasn’t so seamlessly connecting all the apps together, like a web browser is the new connector, Chrome and Explorer and your web browser, if you have five apps open and they’re on different tabs, literally you’re a click away. Do we have a massive need for all these things communicate perfectly with each other. So what I see is a lot of technology trying to-
Chad Jardine:
You might if you’re still using Explorer.
Reese Harper:
If you’re using Explorer. Shout out to all those who I know are still on PC right now and living the dream and Explorer is the only app that even works with half of the tools still. You wouldn’t know this, Chad, but that is, specifically for this audience, a lot of apps in financial services only works with Explorer, sadly, but right now, instead of trying to just get one tool to do a narrow job really well, a lot of people will pass up on that tool that does the job really well because they’ve got this other tool that does five things well, and they try to save money. So it’s like, well, this one for $200 a month that does these five things, so I’m not going to get this best in class tool because I don’t want to have my software expenses be so high.
Reese Harper:
I understand. Minimizing cost is important, but I’m just trying to illustrate the point of, I think more tools that do narrow jobs really well are better than one tool that’s trying to do 10 jobs, and I don’t think you should be obsessed about saving money on your tools. I think you should be more obsessed on trying to drive your price higher. Drive the value of what you’re delivering higher and using the tools to charge more. If a tool can help you charge more, if the tool can help you get more revenue, that’s really important. If a tool is just a cost center, a cost reduction area, and you’re not going to able to charge more by using a tool, then I could see the debate, and I wanted to-
Chad Jardine:
It seems like one of the big questions in that purchase decision, as you’re looking to add a new piece of technology, sometimes we call this the technology stack. All of the different pieces of technology that we have, stacked on top of each other. Sometimes as you’re looking to add a tool to the stack, it can be… One of the big questions is, that there’s this promise of the value that it provides, but you haven’t actually deployed it and used it in the wild yet. You’re wondering if it makes sense to commit to that because the thing that you don’t want is for you to pay for this thing and then get no value out of it and have it just be a blunder.
Reese Harper:
A second concept I would share is, most of the tools, even if you take this minimalist approach of I’m going to have more tools that do more specialized things rather than a big tool that does all things. I still think you’re only probably going to get 60% of a tool or 50% of a tool is probably all you’ll use because it doesn’t really matter the use case of a tool. Every tool is built for a set of customers and you might not be that exact perfect customer that it was built for, and don’t beat yourself up over it if you’re only able to pick up half the utility.
Chad Jardine:
I think that’s really solid advice, to make sure you actually have the problem that is the problem this thing is designed to solve, and sometimes that’s really easy and obvious to tell, and sometimes it can be trickier. In my experience, my biggest mistakes are if I expect the tool to give me the strategy of why I should use it, but if I understand why I need it, then I’m much better positioned to get the value out of it when I make the investment.
Reese Harper:
Yeah. I agree with that and I think, here’s a concrete example. Let’s just take something everyone’s using right now, email marketing deployment. You can get something as inexpensive and basic as MailChimp or you can have something maybe as advanced as Marketo. It can be hard to make a decision on the right email deployment system until you know specifically what you’re going to be using that system for in your own practice. If you’re telling me, “Well, it’s for my newsletter,” or if you’re telling me, “I’m going to use it to actually assist in my lead scoring,” or if you don’t know why you’re going to use a tool for what… You know it’s email, but you don’t know what campaigns you’re going to run. You don’t know what tacticals-
Chad Jardine:
Yeah, there’s a lot of degrees of sophistication in email marketing.
Reese Harper:
I just feel a lot of advisors get stuck, whether it’s portfolio management tools, whether it’s email marketing tools, whether it’s CRM, whether it’s document an electronic signature packages, they don’t exactly have a plan for how that tool is going to be deployed on the other side and what campaigns they’re going to execute with it. And so, they have trouble selecting the right tool. They’ll buy a CRM that’s too weak because they don’t actually know what the CRM is going to be doing in their practice. They just know they need a CRM, or they have an email marketing system that’s not advanced enough, but they didn’t realize what they needed or vice versa. They overinvest in a portfolio management tool when really they just needed to use one that was already accessible to them and inside of their existing suite with their custodian.
Jordan Haynes:
Do you ever wonder if you do enough for your clients to be worth what they’re paying you for? Do you feel like you’re delivering enough value? Many advisors wrestle with questions like these. I’ve used the Elements financial planning system for a couple of years now. With it, I can deliver periodic insight about a client’s financial health and progress by utilizing standardized measurements. They know I’m watching their progress and can actually see how my advice is improving their life. With the Elements financial planning system, you can also give your clients consistent planning guidance and the valuable advice they expect. Check it out at getelements.com/meet.
Chad Jardine:
Something else that seems to be a theme when it comes to technology, is that I think it’s important to determine what things you want technology to do for you. When is technology doing something on its own? When is technology a power up for the user where the combined human and tech solution is greater than the sum of its parts? And what things is it just better for a human being to do?
Reese Harper:
To do? Yeah. I had a lot of times where it’s like, a spreadsheet would have been better for this problem than the software that I’m trying to… There’s a learning curve with software. Here’s another tip. Last tip. I’ll leave two more. One tip is, don’t think that the cost of the software is the real cost.
Chad Jardine:
Yes.
Reese Harper:
The cost of the software is a fraction of the cost of the software. Why is that? Because when you deploy a piece of software, you now create business hours and human capital time and learning curve and management time regarding how that software is going to be used in your practice, and the cost of the software is just probably 10, 20, 30% of the overall cost that you’ve now incurred to do whatever you’re going to do with that piece of software.
Chad Jardine:
Yeah, I would echo that. I think that’s absolutely true. I think it differs depending on the type of software. Some software you need to plan on having an FTE, one full-time employee manning that software in order to make it work. I think something like a sophisticated marketing automation platform, like Marketo or HubSpot or Pardot, or one of these is like that. I think Salesforce can be like that.
Reese Harper:
Yeah, for sure.
Chad Jardine:
Where you have to have somebody who’s dedicated to manning that software in order for your business to get all the value out of it. That can be pretty daunting if you only have two or three people in your practice. I think there are other softwares, however, that are simple in their execution, they’re so user-friendly, and the job that they’re doing is so complimentary that it actually doesn’t require near as much, and it’s one of the questions I would be asking. If I’m buying a new piece of software I thinks integral to my business, I want to know how much manpower do I need to dedicate to keep this thing running and getting all the value I can out of it.
Reese Harper:
Yeah, and for example, elements, one of the things that was really important to me was how can I cut out some of the expensive parts of my practice, and some of the expensive parts of my practice, were collecting information from clients to get an accurate picture of their situation. Onboarding data, documentation, account connections, understanding their net worth and their accounts. Every time I would go to a meeting, even though I had a lot of different software to help me track their net worth, and I was using existing financial planning tools, I’m having to sit down, I’m having to manually type in data at meetings, I’m literally having to walk through an update to their situation in a piece of desktop software projected on my TV screen, is wasting all of my time. I want to be in that meeting, asking questions about how their life has been. I want to hear about, I want to get to the emotional job of financial planning, helping them make decisions and strategic stuff.
Reese Harper:
And so, designing Elements, I’m like, okay, I’ve got to make it to where it’s intuitive. No one has to get an instruction manual on how to update their data and get an accurate picture. I just have to make that be something that can happen from the client’s perspective and that they actually want to do it. Hey, they’re coming to a meeting. They’re going to be motivated to want to make sure their data is up to date. I won’t even have to tell them. They’re getting pinged by the system. It’s going to tell them, “Hey, update your data because Reese wants to talk to you.” That vision is a massive cost saving item that, then you’ve got to decide, well, how are we going to do that? Are you going to do it in computer? Are you going to do it on phone? Well, it’s probably easier on a phone because they’ll probably drive into the appointment and while they’re driving, they’re going to want to update it because they’re like, “Oh, we got to meet with Reese in 10 minutes, quick update it.
Chad Jardine:
Well, and I know we did an episode around data collection and validation strategies, but I think that’s an important component where you’ve got what dependencies are for this software to work, and Elements is a pretty simple example, but all of those. If you’re using a sophisticated CRM or an email automation system, all of those are dependent on other things to make them work. That’s really great.
Reese Harper:
Software doesn’t always have to cost more time and some software will actually reduce your human capital time and it will reduce your operational expenses, and that’s the point of it. If you selected the right piece of software for your situation, and if it matches up with your use case, it’ll actually save you quite a bit of time. Salesforce was not built initially for the financial services industry. That wasn’t its initial use case, and there’s a lot of very complex, if you’re going to run an independent Salesforce org that’s from scratch, your own org, the object and all of the backend work that has to be done inside of Salesforce is much more complex than what most financial advisors would want to have to think about. Tools like a red tail or other CRMs are more practical, but at the same token, if you don’t invest in the right platforms, then you’ll hit scale problems and challenges, and yesterday I got off the phone with an advisor that’s like, “Man, I’ve been spending the last three years, getting the CRM perfectly dialed in that I have and it’s just not enough.”
Chad Jardine:
It’s not going to do him for the next three.
Reese Harper:
“It’s not going to do it for the next three, and I’ve put so much time into this and my staff’s finally trained and we’ve got all our business processes in here.” You got to know when to just bite the bullet and go with the right solution that’s going to take you where you want to get 5, 6, 7 years from now versus what can get me by, and I’ve operated on three CRMs throughout my career and migrated at the right time to the right place, and I wish I would’ve started initially at the place that I ended up at, but sometimes your budget doesn’t allow for that.
Chad Jardine:
That’s great advice.
Reese Harper:
Anyway, this is good technology conversation. I feel like, if you had to give one tip on this to leave the audience with what would it be, Chad?
Chad Jardine:
Buy Elements.
Reese Harper:
Yeah. 10, four. Yeah, I like that one. He’s not very self-serving. What’s another one tip you might leave, besides that self-serving example?
Chad Jardine:
Well, I think for me, tools can be really powerful amplifiers of your impact. They can amplify the impact of your employees. They can amplify your impact with clients. I think it’s foolish to not be evaluating where you can plug a tool in to create that impact. I think really the things that we’ve talked about, about making sure you’re not relying on a tool to bring strategy to you. You have to know what you want the tool to do, understand enough about your business to know what you expect to get out of it, and you’ll learn more things along the way, but I think those prerequisites, understanding the amount of manpower and bandwidth it takes to keep the tool up and running, understanding dependencies on other tools or other processes and systems. Again, in a nutshell, I think that’s a really good encapsulation of what it takes to be wise as you’re evaluating adding tools into your technology stack.
Reese Harper:
I assume you’d have the same question for me and I liked that tip. So my number one tip-
Chad Jardine:
As a matter of fact, yes, I do.
Reese Harper:
My number one tip would be, prioritize your budget on technology that helps you charge more to customers. That’s where I would prioritize my budget. I would say if a tool is going to allow you to enhance your service or deliver more value to your end client, it should receive a disproportionate allocation before you… If we all got X percent of our P&L to dedicate towards software, make sure that we’re not just putting that towards maintenance and commoditized investments of software, but make sure we’re putting it towards things that actually enhance our ability to improve our client relationship, increase the value of their receiving and consequently charge more. I’m not saying just charge more, but it’s increasing the value we’re delivering to the client so they can increase their fees and thrive because that’s what’s going to drive value to your practice. Anyway, thanks for tuning in everybody. Thanks to Chad, thanks to Tad. Appreciate you guys doing the work every week and we’ll catch you guys soon.
Jordan Haynes:
Next time on Elementality.
Carl Richards:
We’ve heard this story a million times. All the research says you absolutely, the things you regret on your death bed are the thing, not something you did that failed. Never. It’s something that you didn’t do. The things that you didn’t do. The time you didn’t take your daughter to lunch. The trip you didn’t go on with your son. It’s those things that you regret. We know it and we have cliches that we say all the time, “Nobody regrets not spending another hour at the office,” and then we go do it.
Jordan Haynes:
You can learn more about the Elements financial planning system at getelements.com/meet and schedule a time to meet with me or one of our friendly financial planning experts. Elementality’s executive creators are Reese Harper and Chad Jardine. Elementality is produced by Abby Morton and directed by Jordan Haynes.