Our conference participant review was originally provided for the Institute for Innovation Development.
At the beginning of November, our team exhibited at Schwab Advisor Services’ annual IMPACT conference in Denver, CO.
This year’s conference returned to an in-person format for the first time in two years due to COVID and hosted 5,000 live attendees at the Colorado Conference Center, with somewhere around 2,500 of those attendees being wealth advisors and professionals.
This year’s IMPACT was also the first time in conference history to bring together advisors on the Schwab and TD Ameritrade custodial platforms under the same roof since TD Ameritrade was acquired by Schwab back in 2019.
Widespread excitement and contagious energy filled the conference center over the course of the three days and not once did this level of energy dissipate or fizzle out.
The energy levels were high, the people were amazing, the keynotes and presentations were thought-provoking and rich with insight, the events and socials were buzzing, and most importantly, there was optimism and encouragement for a bright future ahead.
Below are our top 5, from many, key takeaways from this year’s conference that will impact, no pun intended, and influence the course for 2023 and beyond.
1. The Schwab and TD Ameritrade Integration will be complete by Labor Day 2023
Charles Schwab’s acquisition of TD Ameritrade has been the single largest story and development in the RIA custodial space in the last few years. The deal, which was announced in late 2019 and officially closed in the Fall of 2020, brings together two multi-trillion-dollar RIA custodians and their ecosystems, creating a massive integration process to transition advisors and clients from the TD platform to Schwab.
This multi-trillion-dollar integration of the two platforms makes Schwab the largest RIA custodian, by a landslide. To put it into perspective, the two platforms are responsible for more than half of all assets managed by Registered Investment Advisors.
And now, the complete integration of the Schwab and TD Ameritrade platforms and ecosystems has a final date — Labor Day 2023. This means that the transition for advisors currently on TD Ameritrade Institutional over to Schwab Advisor Services will likely take place over the 2023 Labor Day weekend.
An applauded moment during the IMPACT opening remarks was when Schwab’s Head of Advisor Services, Bernie Clark, confirmed with the audience (advisors) that Schwab does not intend to implement a custodial fee that some other RIA custodial competitors have been considering amidst market headwinds.
While there is certainly a lot that can happen from now until the Labor Day 2023 weekend, the industry will certainly be paying close attention to the progression and eventual completion of the Schwab and TD Ameritrade integration.
2. Personalization continues to be a critical theme for Advisors
The significance of the topic, or rather the theme, of Personalization, continues to be echoed across the country and throughout conference halls everywhere.
During the opening ceremony and remarks, Bernie Clark and Walt Bettinger signaled just how significant personalization is and how this “theme” is central to everything in modern-day wealth management. Bettinger even called and compared personalization to that of a freight train for Advisors.
Meaning this shift in consumer behavior and new client expectations are coming at Advisors faster than many may realize and/or acknowledge. This is very telling of where the industry needs to go and where it is very evidently headed.
The Digital Client Experience, and Personalization as an extension, need to be prioritized across every single level of the organization. Plain and simple.
This is no longer an Advisor-only duty and obligation, but rather an organization-wide strategic narrative that simply must be baked into the DNA of modern financial services and wealth management firms.
Julie Littlechild and her team at Absolute Engagement are huge advocates of personalization and helping Advisors take their digital client experience to the next level. At this year’s IMPACT, Julie shared some of her recent thinking around mindset, engagement, and the future of client experiences during her session which was called How Client Mindset is Changing the Client Experience. When it comes to this topic, Julie and her team are undoubtedly at the top of the expert list — if you are not following Julie, you need to be.
Keeping with the theme of personalization, Chris Volpe, Managing Director at Zephyr shared his thoughts at IMPACT regarding how technology is enabling better client relationships by affording firms and advisors the ability to personalize communications at scale, in a way that really matters for clients.
3. Frictionless client onboarding and account opening workflow is a major area of focus
Creating the ultimate onboarding experience, one that is frictionless, easy, and enjoyable for clients, will continue to drive strategic narratives and influence spending in 2023.
From better back- and front-office enrichment and automation to more tightly integrated processes with e-signature capabilities, firms are looking to shape their onboarding process to button up compliance and security concerns, improve professional productivity by saving valuable time, and most importantly, deliver the best possible client experience.
This was evident in the hundreds of conversations our team had with advisors and back-office teams. One of the (many) areas that really stood out during these conversations was FutureVault’s e-signature automation and capabilities to automatically provision and create new client Vault accounts, while simultaneously automatically delivering all e-signed onboarding documents directly into specific folder locations in one or many Vaults instantaneously. For the back office and compliance teams, this gives confidence in a secure delivery method of critical documents while meeting document retention requirements. For the front office and advisors, it means less time is spent manually sorting, filing, and sending documents to clients. And for the client, it means that any-and-all signed documents by the client are available and accessible to them in their personal digital vault.
Remember, the initial onboarding experience and account opening process can often pave the way for a long, healthy relationship; the opposite can also be true.
4. Technology enables business outcomes and helps you deliver and improve your value proposition
Over the last several years, we have witnessed the role technology has played and how it has evolved to be the cornerstone of wealth management.
What once used to be a nice-to-have has now evolved into a must-have to thrive and survive in today’s landscape.
Your technology stack isn’t just pieces of technology “glued” together in separate areas to achieve siloed outcomes. It has become more strategic than that and must be deployed to complement your strategic narrative and elevate the value proposition in all areas.
Shirl Penney, CEO of Dynasty Financial Partners delivered a great presentation full of takeaway insights on how (and why) firms absolutely must look to tech-enable their business. Shirl’s presentation really resonated with our team and our philosophies, but what caught my attention on one of his slides was the question he posed at the bottom, “Can you double your number of clients without doubling your headcount?”.
In the same presentation, Shirl breaks down four components of WealthTech:
- Business
- Investments
- Consumer
- Data Analytics.
This thought-provoking question and the four components above, imply just how critical technology has become and will continue to become to deliver business outcomes, improve upon strategic decision-making and be central to the value proposition of your firm in 2023 and beyond.
5. 360 Integration is critical for WealthTech providers
Wealth management firms and advisors are feeling pressure when it comes to making technology decisions, and rightfully so. It is not only critical but rather necessary, that integration and Open APIs exist for modern WealthTech firms.
The lack of connectivity and seamless integration is a very prominent challenge across the industry. As firms venture down the path of siloed technology implementations, we continue to see the rise of integration challenges, amongst other significant challenges which include resource allocation, financial risks, loss of productivity, and a poor client experience.
But what’s more of a challenge than the lack of integration between technology providers is the lack of connectivity and integration into operational processes and client workflow.
From back and middle office tools and technology to advisor-facing and client-facing portals, the winning recipe is creating an ecosystem of best-of-breed technologies that create, in the words of AppCrown’s Franklin Tsung, a “Digital Advisor 360 Platform”.
Franklin also predicts that many advisors will soon be looking at their technology stacks as tech providers consolidate. During an interview at IMPACT, he shares why many independent advisors will be looking at multi-custodial, independent technology that can help them scale in the year ahead, such as online communities, document vaults, portals, and marketing integration that connect seamlessly with CRM systems.
Bonus Takeaway: SEC compliance continues to shake up the industry
SEC Compliance handling is a top-of-mind priority that has firms and advisors pay close attention to what’s unfolding, especially as the SEC continues to amend existing rules and propose new ones, causing chaos, panic, stress, and a lot of head-scratching.
The reality is that the majority of firms are left scrambling to find a solution and that’s if they even know where to begin looking in the first place. Below are three compliance requirements and rulings from the SEC related to managing critical documents and record-keeping that continue to receive a lot of attention:
1) SEC document retention compliance, Rule 17a-4, and the requirement of having a Write-Once-Ready-Many (WORM) format.
2) Enhanced disclosure and archiving of all marketing/advertising communications. The deadline for this new ruling was on Nov 4th, 2022, however, the majority of firms have likely pushed this off into the new year for many reasons (not knowing where to start, waiting to see what unfolds first, and downplaying its significance are the three most common reasons).
3) 3rd Party Vendor Management Due Diligence (the SEC has proposed new oversight requirements for certain client and third-party outsources including record-keeping related to due diligence and third-party service monitoring.
