In this episode of the Modern Financial Advisor Podcast, host Mike Langford is joined by Adrian Johnstone, CEO of Practifi, to discuss the pivotal role of CRM systems in financial advisory firms.
They explore the debate between the importance of custodial systems versus CRMs, emphasizing the value of maintaining rich client relationships. The discussion also covers the concept of viewing technology as an investment rather than an expense, the scalability of CRM systems, and the potential future of AI in the industry.
Perfect for advisors looking to gain insights on leveraging technology to enhance their client relationships and operational efficiency.
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Mike Langford sat down with Adrian Johnstone, CEO of Practifi, to delve into pivotal topics surrounding client relationships, the role of technology in financial advisory, and the future of the industry. This discussion offers invaluable insights for advisors seeking to adapt and thrive in an ever-evolving landscape.
Understanding the Core of Client Relationships
Johnstone eloquently touched upon the age-old debate of whether the CRM or portfolio management system serves as the core of a financial firm. Both Mike and Adrian agreed that while the financial asset record holds undeniable importance, it is the record of the client relationship that truly drives business value and compliance. As Johnstone stated, the CRM should be treated with the same sanctity as custodial platforms because the heart of a successful advisory business is the strength of its client relationships.
Technology: An Investment, Not an Expense
Adrian made a compelling case for viewing technology not just as an operational expense but as a strategic investment. He highlighted that technology, when considered an investment, prompts advisors to explore its full potential and harness its capabilities to drive business growth. Unlike the static nature of human knowledge, technology evolves rapidly, offering continuous enhancements and efficiencies. By aligning technological investments with long-term business goals, advisors can ensure sustainable growth and scalability.
The Future is Scalable
A notable vision shared during the conversation was Practifi’s goal of being the last CRM an advisor would ever need. By leveraging scalable infrastructure and robust data models, Practifi aims to cater to solo advisors as well as large multi-billion AUM firms. This scalability not only facilitates business growth but also ensures smoother succession planning and transitions, making technology an indispensable ally for future-proofing an advisory business.
Human Connection in a Tech-driven World
Despite the rapid technological advances, Johnstone reinforced the enduring importance of human connections in advisory relationships. No matter how sophisticated technology becomes, the essence of trust, understanding, and personal interaction remains irreplaceable. Technology's role should primarily focus on removing operational friction, thus allowing advisors to focus more on nurturing client relationships.
A Call for Integration and Cooperation
The conversation concluded with a thought-provoking wish: a standardized integration language across all financial technology platforms. Such a development would enhance portability and interoperability, allowing advisors to seamlessly integrate various technology solutions and ultimately deliver better client outcomes.
Conclusion
Adrian Johnstone’s insights offer a roadmap for advisors navigating the complexities of modern financial services. By embracing technology as a growth partner and maintaining the core human aspects of advisory services, firms can position themselves for success in an ever-evolving market. As the industry continues to change, staying informed and adaptable remains crucial for advisors aiming to lead and not just keep pace.
Chapters
00:00 The Debate: Custodial System vs. CRM
00:44 Introduction to the Podcast and Guest
01:53 The Importance of Client Relationships
04:24 The Role of CRM in Client Records
17:15 Technology Adoption in Financial Advisory
25:37 The Value of Technology in Financial Services
26:18 Technology as an Investment, Not an Expense
27:06 Maximizing Technology's Potential
32:14 The Future of Technology in Financial Advisory
34:23 Human Connection in the Age of Technology
40:41 Scalability and Integration in Financial Technology
51:44 The Importance of Standardized Integration
54:04 Conclusion and Final Thoughts