After troubled start, Morgan Stanley tech platform stabilized

CIO Chris Randazzo says 3D has 'turned the corner,' while upgrade continues

Mar 31, 2014 @ 12:30 pm

By Joyce Hanson

Morgan Stanley, Smith Barney, technology, wealth management
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(iStock, Gerardo Tabones)

After facing an uphill battle when he joined Morgan Stanley less than a year ago, Chris Randazzo, the wirehouse's chief information officer for Global Wealth Management and Investment Management, has finally succeeded in delivering a stable platform, according to advisers at the firm.

Mr. Randazzo, who stepped into his new role in June 2013, came on board in the early stages of an 18-month, $500 million upgrade of the firm's 3D platform and mobile applications.

Now in its 15th month, the upgrade program has improved 3D's speed and stability, analytics and automation processes, advisers say.

“It's night and day from where it was. It's a stabilized system. Everything functions and moves. We have the right players in place,” said Mark Bradburn, a Morgan Stanley senior vice president and adviser.

Mr. Randazzo's job initially included doing damage control following the initial conversion of the technology platforms of Morgan Stanley Global Wealth Management Group and Citigroup Global Markets Inc.'s Smith Barney division into a single system, known as 3D, following the firms' merger in 2009.

Before Mr. Randazzo came on board, brokers had repeatedly complained about system instabilities such as slowness, freezing and error messages while trying to adapt to the 3D platform. Morgan Stanley Wealth Management president Gregory Fleming responded in January 2013 by announcing the 18-month upgrade. That summer, Mr. Randazzo, a longtime Bank of America Merrill Lynch tech veteran, was hired to replace Moira Kilcoyne, who was promoted to the role of co-chief information officer for the entire firm.

Mr. Randazzo said the 3D upgrade is proceeding “reasonably well,” noting that the initial combination of the two firms was completed in 2012 before he arrived at Morgan Stanley. Now, he said, his goal is to further stabilize 3D with more enhancements to the platform and to roll out new platforms in the near future.

“We have made a significant investment in upgrading and refreshing our software, hardware and data centers,” he said. “I feel as though we have turned the corner.”

Morgan Stanley announced Monday the launch of its first-ever mobile application for clients on iPhone. The free app lets clients access their portfolio and connect with their adviser from any mobile device, according to a company statement.

Looking ahead, Mr. Randazzo said he is focused on creating technologies that give advisers a competitive advantage. He said new developments will include integration of banking and lending, upgraded advisory and capital markets platforms, reduced data entry, and customized screens for advisers.

“We are absolutely talking about product integrations,” Mr. Randazzo said. “A lot of the conversation has completely shifted from the conversion to what are we doing in the future. As a technologist, that's the conversation you want to have.”

Mr. Bradburn came to Morgan Stanley from Smith Barney when the two firms merged. He said he experienced technical problems with performance reporting on the 3D platform in those early days, but he hasn't had a performance reporting issue in months.

He credited Mr. Randazzo with providing the fresh air that Morgan Stanley's technology platform needed. As a member of the wirehouse's financial adviser advisory council, Mr. Bradburn said he is regularly asked to give feedback on the 3D upgrade.

(More: What's now and what's next for Morgan Stanley's new trade tool.)

“Nobody talks about technology being an issue anymore, whereas that was a big part of the discussion before Chris came in,” he said. “People on his team send us mockups saying, 'Does this help you?' Now it's a big collaboration where everyone works together.”

Independent recruiters who do not recruit on Morgan Stanley's behalf also reported that the wirehouse's technology is no longer an issue for advisers there.

Danny Sarch, president of recruiting firm Leitner Sarch Consultants, said on a scale of 1 to 10, with 1 being the lowest, Morgan Stanley advisers he spoke to in the past gave 3D a ranking of 1. Now they're awarding the platform a 5 or a 6.

“I don't think it's the flash point of dissatisfaction that it was a year ago,” Mr. Sarch said. “I spoke to three separate advisers who I view as being technologically savvy, and they say that the system is absolutely more stable than what it was. There's a feeling that they're no longer afraid that they will lose data when the system crashes.”

(See Mr. Sarch's April 2013 take on 3D: Morgan Stanley 3D, almost a year later.)

Recruiter Mark Elzweig, president of Mark Elzweig Co., who represents financial advisers seeking career moves with national, regional and independent firms, said a primary reason for broker departures after the merger was frustration with the 3D platform.

Mr. Elzweig said part of the problem was a cultural divide, with Smith Barney brokers feeling that their previous platform was superior and that their new company wasn't interested in hearing their feedback.

“They just rolled it out without the close consultation of advisers, and advisers didn't really find out what it could and could not do until after the fact,” he said.

But in the last week, Morgan Stanley brokers have told Mr. Elzweig that the 3D platform has improved and the new IT team is identifying the issues and addressing them.

“They feel that the system is now more user-friendly for them and clients than before,” he said.

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