Tax & Accounting Blog

Onboarding Automation Gives Wealth Managers a Competitive Edge

Document and WorkFlow Management, Information Reporting for Wealth Management, Tax Information Reporting, Trust Tax August 24, 2011

Wealth management firms are missing opportunities to deepen client relationships and increase revenue during the account onboarding cycle according to the July report, Wealth Management Onboarding: Expanding beyond Account Opening, from Boston-based Aite Group. More than 70% of wealth management firms surveyed view client onboarding as either a back-office function that needs to be cost-contained or a front-office automation tool;  only 30% view client onboarding as a competitive differentiator.

“Delivering a high level of service to clients is particularly important during the new-client onboarding stage,” says Sophie Schmitt, senior analyst with Aite Group and author of the report. “This is when clients are forming their first impressions of the firm and have momentum to make changes in their financial lives.”

Firms and institutions know that the early phase of the new client experience is the most active period, filled with more direct client contact through meetings, calls, emails and mail than any other time in the relationship.  The onboarding process is a complex one that opens opportunities but, at the same time, carries a high level of risk.  Clients who are satisfied with the onboarding experience may be more likely to consider expanding their relationship with the firm; clients with a negative impression may decide to move on.

The report concludes that firms see a marked increase in efficiency when they improve their level of onboarding process automation. Firms operating with the highest level of automation are able to open accounts in half the time it takes firms that have some or no processes automated. Firms rated the transparency of the process/status of the account in process as the most important factor in meeting their business objectives.  It’s clear that onboarding workflow automation offers firms an important competitive edge.

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