Bill Hortz's picture

"There's a lot of misinformation or misconceptions in the approach that managers are taking in terms of evaluating and purchasing pieces of technology." - Matt Franey, Celera Systems

[Technology is a vitally important tool but one must be careful not to use it as the proverbial “hammer” where everything else around it is a nail. Unnecessary or non-strategic application of technology can become a trap - a time, money and resources drain. How do we then determine the most efficient use of technology to solve a problem? What amount of technology is “just right”?

The Institute for Innovation Development decided to explore these questions with Matt Franey, Director of Business Development at Celera Systems – an innovative information technology solutions provider and developer of SalesStation, a highly sophisticated data aggregation and data repository platform for the asset management and insurance industry. They grapple with these questions everyday in applying their technology to build out contact management, sales automation, and activity tracking systems to support their clients’ sales efforts. This is an important topic to explore because getting it “just right” can transform corporate data into tactical weaponry for executing on strategy.]

Hortz: How do you see your role as an innovator in information technology solutions?

Franey:  To make the right business decisions and deeply understand the interactions of investors and advisors with your firm, you need data. The data your firm is already generating, or has access to, needs to be analyzed and converted into strategies. So, I really view our role as two-fold.

First, it’s generating clean data. We have essentially what you could think of as a manufacturing process where we're going out to what amounts to dozens of different sources of raw data, which we then clean, and centralize, and distribute.

Secondly, is our role of providing tools and guidance to our asset manager clients in terms of how to generate actionable insights from that data. An important point to make is that, as the industry has been evolving, now operating in a more model portfolio business where there's essentially an account structure that sits between mangers and their end point investors or selling advisors, asset managers are becoming more and more steps removed from that important information. That's a very challenging business environment in which to operate. How are you supposed to make sure that you're staying relevant to your end investors and selling advisors? What strategic decisions should you be making?

And so, that is really the paradigm or the challenge that we are seeking to meet. Just getting to clean data, and getting a clearer understanding of who are those end point individual and advisor clients, has traditionally been the challenge that our clients have focused on. I like to say that we, as a technology industry, have been known as basically “sales reporting”. Although, I'd contend that that's sort of an incomplete answer or imperfect term for what we do because really since our true value is in being managers of and consultants on data.

Hortz: How do you balance robust technology into a cost/time efficient solution? How much technology is the right balance?

Franey: I love this question because once upon a time, there was a dearth of options. Now there's almost an embarrassment of riches in terms of the technology solutions available to asset managers. And so, what I advise asset managers to do, who might be a little bit, let's say, overwhelmed or inundated with potential different tech solutions, is to constantly make sure that they're working backwards from the business objectives that they're trying to solve. So this is really going to look different from firm to firm in terms of the balancing act because different organizations have different business problems that they're trying to solve.

Working backwards from the business problem helps you arrive at a technology prescription that will be essentially a portfolio or tech stack approach of different pieces of technology that will solve that particular business problem. One specific solution versus another probably won't be the end-all-be-all. It's really a portfolio approach in a lot of cases to making sure that they're adopting the right technology.

And then secondly, and maybe most importantly, I would like to add to that while some technology can be transformative, technology in and of itself is not a panacea. Executives should be wary of technology being looked at as a silver bullet. It essentially becomes making sure that the technology prescription that they are fitting to their business problems is being utilized and adapted by their human capital – employees, people. Be aware in the evaluation phase, that this tech decision also becomes a matter of committing human capital to using and administrating the technology prescription. So they need know the amount and expertise of their human resources to support the prescription, and are willing to make those investments. Then I think that they can feel good that they will have at least in the near term solved the balancing act of the equation and can feel good about implementing those solutions.

Hortz: What are the downsides of too much tech?

Franey:  Wasted money I think would be the primary downside. I think if we consider the fact that there's going to be a more holistic strategy in place for adopting the technology, I think too much technology input into that solution also puts adoption of that overall prescription at risk. I think at risk in terms of solving whatever business problems they're trying to solve. Ultimately, the business problem trying to be solved can be lost in the mix if organizations just try to throw a whole bunch of tech at the problem.

Outside of the adoption equation and the utilization equation, integrations can become messy if there are too many disparate systems that are sort of being put into the juggling act or the overall prescription. If these systems aren't communicating with each other then there's skepticism of behalf of the users within the organization. That can also put the adoption of the solution at risk.

Hortz: How does your firm go about determining and developing the right technology solutions for your clients?

Franey:  At Celera, we have our roots in engineering. We are a project-based organization. I think what we've retained in terms of our engineering-centric culture is a real benefit to clients because we're so problem solving based. We're really focused on helping our clients to generate a set of requirements. In doing so, we are helping our clients to conceptualize the business problems that they're facing, and then determining the set of requirements needed, the right sort of solutions for those requirements, offering some options, and then moving forward in terms of developing those solutions.

We're just inherently always on top of what our clients are trying to do. I point to the emergence and proliferation of interval funds as a really sort of fertile ground for solution development because that has brought its own unique, I would say, situation in terms of needing to do new and interesting things with the data that we're providing them. I would also point to the emergence of model portfolios and the managed account, the proliferation of those products also offering up their own unique data problems and therefore data solutions that will help solve them. It's really a matter of making sure we're staying in concert with our clients, understanding the problems that they're facing, and then maintaining a stance of developing solutions around them.

Hortz: How does technology help asset managers compete with larger asset management distributors?

Franey: I think technology, at least how we apply it, assists in a few ways. First, technology reduces the carrying cost of personnel. We do that in a couple ways. We're able to make managers more productive as they spend less time hunting and pecking for data and more time doing their actual jobs, engaging stakeholders, what have you. Secondly, our offering is a fully managed package, so firms don't have to commit IT resources to installing, building, maintaining any infrastructure. Everything is done and managed 100 percent over the cloud by us. That's the first one, reducing the carrying cost of personnel.

Secondly, the type of data that is provided. It fuels other technology, for example, marketing automation, which allows managers to quickly and efficiently distribute content to their client base or other stakeholders in an organized and deliberate fashion. We have dedicated resources on staff here to help them do that and to help our clients integrate those types of technologies to the data and operationalize them, which we think is a huge benefit because we know and understand the industry, the technology component of it and what they are trying to accomplish.

Thirdly, we have a proprietary database of dealer bank rep codes that is shared amongst our client base. Our clients essentially benefit from each other's participation through the aggregation of all of the codes that their business is associated with. Vast databases of codes used to only be the province of large managers with very wide channels of distribution. Now, as a result of our approach to managing the data, managers can enjoy those same benefits through aggregation.

Finally, it’s always worth mentioning that our technology is 100 percent scalable, regardless of the size of the organization, as we feature best-in-breed data infrastructure. Our unbundled pricing model ensures that managers only pay for what they use, as they grow, which we feel is a huge benefit to all sizes and shapes of asset managers.

Hortz: What are the right questions to ask about contact management and sales reporting systems?

Franey: Incidentally I wrote a blog post about this a few years ago and this is still an ongoing question even a few years later. We're about to kick off an initiative in terms of helping asset managers have these conversations because there's a lot misinformation or misconceptions in the approach that managers are taking in terms of evaluating and purchasing pieces of technology.

But, succinctly, the most critical points to ask about in the decision making process are: accuracy and timeliness of flow and asset data, efficiency and scalability, having a robust data mart and reporting options, integration to CRM, extensive product support and resources, bench strength and expertise of team, and flexible pricing arrangements. I would definitely encourage your readers to go read my blog post, which goes into a lot more depth than we can go into here.

Hortz: What best advice can you offer asset managers and other distribution organizations about choosing and applying tech solutions into their growth and engagement goals?

Franey:  My first piece of advice is to have a holistic strategy. Don't just buy technology in an ad hoc fashion or because someone told you to. There's too much at stake to take sort of a casual approach to this, this needs to be born of a strategy that we see most successfully implemented when it's coming from the C suite.

My second piece of advice is communicate with the firm's various stakeholders about the investments that you're making to the technology because in order to get buy in, there needs to be an effective approach to communicating to the stakeholder why you're doing what you're doing. Communicating will drive buy in and then buy in will drive adoption and adoption will drive success. If you don't adopt technology you're just wasting your money

My final point is that there is some amount of rewiring of the corporate mindset that's necessary because these well worn business processes of how your firm has traditionally done business will necessarily be shaken up as a result of the purchasing of this new technology

So have a strategy, communicate that strategy to the stakeholders and then learn and adapt to the new technology in place.

The Institute for Innovation Development is an educational and business development catalyst for growth-oriented financial advisors and financial services firms determined to lead their businesses in an operating environment of accelerating business and cultural change. We position our members with the necessary ongoing innovation resources and best practices to drive and facilitate their next-generation growth, differentiation and unique community engagement strategies. The institute was launched with the support and foresight of our founding sponsors - Pershing, Voya Financial, Ultimus Fund Solutions, Fidelity, and Charter Financial Publishing (publisher of Financial Advisor and Private Wealth magazines). For more information click here.


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