The objective of the financial advisor site within Bricknode Broker is that it should be used as a complete financial management system for financial advisors who are tied agents to the financial intermediary who licenses Bricknode Broker. For this article I will call it the Financial Advisor GUI (Graphical User Interface). The goal of this GUI is NOT to offer a place for extensive performance reporting and financial analysis of managed portfolios, this could easily be accomplished by using our extensive API though. Instead it is a fantastic tool for keeping track of the income attributable to the financial advisor (fees) and order placement.

The financial intermediary who licenses Bricknode Broker can create a financial advisory company in the system and then a number of associated financial advisors. The advisory company will have a number of accounts that it owns for each advisor and the advisor will be linked to their accounts. This way the advisory company can keep track of how much fees are earned and owed to each advisor. The advisor can then log on to the Financial Advisor GUI to see how much money they have earned and request withdrawals to their own external bank account or if the advisory company should use the money to pay as salary to the advisor. Either way Bricknode Broker keeps track of the income and the advisor can manage their own cash flow within Bricknode Broker.

The customers will then be linked to their financial advisor who, depending on the permission levels, could place orders for their customers and manage all types of documentation and onboarding.

The chart below demonstrates the best practice setup for this use case.

There is a full guide available here for how to set this up in Bricknode Broker.

Investing and advisory is changing rapidly! For the first time since the dawn of online investing the financial services are changing from list based sites into more enticing offerings using the tools offered by social media.

An interesting article in Investment News presented examples of even the older generation moving to online services to manage their assets, read the article here.

2014-05-26_09-47-22Instead of having to select between individual stocks the casual investor looks to follow others and being able to invest in themes. A great example of a stock focused site for this type of investing is Motif Investing who has created a new type of brokerage firm around this concept.

 

This relates to all asset classes and not only stocks which is why Bricknode; with its broad API; can support financial service firms who wish to create their own concepts using Bricknode Financial Systems as the general framework.

If you manage or own a financial advisory firm; or if you are running a financial institution with financial advisory as one of your business segments you should be reading this article.

Lets start by specifying some of your greatest pains with regards to your financial advisors.

Now, lets address one by one and look at how I think technology can offer a solution to each one of them.

Lack of productivity

The absolute greatest challenge for a financial advisor is how to leverage their time and this is one segment where technology really can help.

A great example of this is the effort by Danske Bank to start offering eMeetings. By utilising technology in the advisory process you could have customers pre-fill a lot of the questionnaires which you need in order to conduct the advisory process. The advisory tool could then present a few default packages based on the economic situation of the customer in relation to their risk appetite.

A simplified advisory process could look like this:

  1. Book a meeting
  2. Send an electronic information collection form to the customer
  3. Automatically compute received information to arrive at advisory packages
  4. Review advice live with the customer through a web presentation

Fulfilling regulatory requirements

As a manager or owner of a financial advisory business you can never be absolutely sure that your advisors are fulfilling all of their regulatory requirements unless you have a strict technical process in place. Using a customer acquisition software service you could configure the process ad-hoc and get some ease of mind while at the same time increasing productivity.

Verifying advisory process

To build company value as a financial advisor you have to be able to measure the effectiveness of your advisory process while at the same time being able to replicate it throughout your whole staff of advisors.

You constantly have to develop and adapt your process to the changing needs of your customers and the global environment. By utilising an integrated cloud based solution you could constantly configure your process and measure the results for both your advisors and your end customers.

Bricknode has embarked on the journey of working with financial advisors in order to create scalable value and increase competitiveness among small and mid-sized advisors. Please give us feedback on our Advisory module and Customer acquisition module!

At least in the Swedish financial press there is a very hot topic currently being discussed with regards to the kickback-based business models used by financial advisors.

Today’s newspaper holds an article written by Christoffer Folkebo, the CEO of Max Matthiessen, a well-known insurance advisory firm. The article focuses on developing a standardised way for presenting all fees surrounding fund investments in a transparent way for customers.

I have previously touched upon this topic through various articles including “3 steps for surviving as a financial service company in the 21st century”, Thoughts on commission less world in our LinkedIn Group, Richard Leeson also wrote a good blog post on the topic titled “A Commission Less World”.

If for example kickbacks for financial advisors are to be banned the industry has to find a new scalable way of doing business. Obviously a financial advisor has to receive some sort of compensation for their work and the most transparent way would be to just charge a fee upfront for their services. If an advisor would charge for their hours spent only the very rich could afford having this type of service which means that the advisors instead could move towards implementing some sort of subscription model.

The next question one has to ask is what is the end customer ready to pay for? My response would be:

By categorising customers in certain ways it is possible to automate some of the ongoing advisory process and by doing this the advisor would be able to scale out their services without selling hours.

In summary, all these events and business model adaptations are a testament to the fact that IT-systems are getting an even more centralised role in all aspects of the financial services business.

Within Bricknode Financial Systems (BFS) financial advisors can manage their clients and their business. BFS handles everything from customer communication, order placement, event planning to file management and monitoring of fees.

Click here to read the get started guide for the Advisor module within BFS which looks at the following 6 steps.

  1. Sign in
  2. Navigate the dashboard
  3. Enter orders on behalf of customers
  4. Monitor transactions and events
  5. Communicate with customers
  6. Manage files