Advisory firms are gearing up for growth in 2013. According to the latest TD Ameritrade Institutional Advisor Index survey of 502 independent registered investment advisors (RIAs), 97 percent report total number of clients increased or remained steady over the past six months. Nearly nine in 10 RIAs expect a faster asset under management (AUM) growth rate in 2013.
Advisors indicated they will implement a variety of strategic planning initiatives to prepare for their firm’s growth over the next six months. Conducting internal strategic planning discussions (67 percent), using benchmarking studies and whitepapers for guidance (37 percent) and conducting workshops sponsored by custodians or other vendors (20 percent) top the list of tactics advisors are planning.
“RIAs find themselves in an interesting paradigm – a challenging business environment combined with an unprecedented opportunity,” said Jim Dario, managing director of product management, TD Ameritrade Institutional 1. “Many leading firms have seized the opportunity and created dynamic, fast growing and profitable enterprises by identifying the cost drivers in their businesses. RIAs are able to build long-term value for their firm by leveraging technology that delivers consistent client service and scales with firm growth.”
Advisors’ Top Strategic InitiativesAdvisors surveyed say deploying technology to increase scale (63 percent), systematizing client service and delivery (58 percent) and training and developing staff skills (58 percent) are top strategic initiatives for growth over the next six months.Investing in TechnologyInvesting in technology (63 percent) is the top infrastructure investment advisors plan to make over the next six months to accommodate business growth. Advisors surveyed also plan to invest in customer relationship management tools (33 percent), performance reporting tools (31 percent) and mobile devices (28 percent). “Adopting new technologies alone will not create office efficiencies, improve client service or provide a pathway to more profitable growth,” added Dario. “These solutions will need to be integrated within a firm’s workflows and adopted by staff members as part of their day-to-day responsibilities to ensure consistency and effective impact on business processes.”