Even low-tech tools can trip up advisers going independent

An adviser shares his experience starting his own firm, and the challenges of not being able to depend on a home office anymore for phones, faxes, malware and more

Oct 24, 2016 @ 12:01 am

By Christopher Rand

One benefit — or detriment, depending on your outlook — of working for a large firm is that your technology platform is mostly prescribed to you. The firm tells you what you will use or provides a very short list of approved providers. When I co-founded an independent practice two years ago, I appreciated the opportunity to choose the most suitable platform of technologies to fit my new business model, including which CRM, financial planning software or investment research provider that we'd use.

With so many high-tech options to research and choose from, I found myself concentrating almost exclusively on those choices with little to no time spent on the low-tech necessities, which I soon found out would be a very important part of setting up the independent business office structure.

(More: Tech-tardy advisers, prepare for a late-adopter penalty)

Simple things like having a phone system with voicemail, internet connection when you plug your computer into the wall or a scanner that securely sends a document to your computer turned out to be major challenges when transitioning from a major firm to an independent practice.


For one thing, phone systems are really advanced now, and come with more options that you can imagine. You need to select a provider and purchase or lease the system equipment, which seems pretty obvious, but one thing we did not expect was that the phone company didn't run the lines from the point they installed the phone system to the different work spaces. They supplied the line to the phone system and the phones in the different offices, but not the lines between the two, a gap we discovered in our system.

We also learned that fax machines don't work on the same type of phone line as modern phone systems, so we had to run an analog phone line and set up a separate account with the phone provider.

Firms also will need to purchase or lease a copier/scanner, and it's important to make sure it is connected to the network (which includes running a data cable to where it will be housed) so documents can be scanned and sent to your computer. In our highly regulated profession, it's important to ensure proper encryption of the data being sent from the scanner to your computer to protect client privacy.

Obviously the internet connection is a critical component of any modern office, and something else that needs to be researched. We had to decide what speed would be needed for our office setup, and whether it should be wireless or hard-wired, or both (we chose both). We had the same company that ran the phone lines, run our data cables for the internet connection. But we had to hire a third contractor to supply the router and set it up (as neither the company that ran the cables nor the internet service provider were able to install that piece).

(More: Advisory firms growing with tech, but not without troubles and false starts)

Some other key items to consider are things like purchasing computers for yourself and any staff. Laptop vs desktop? What antivirus, malware and full-disk encryption software to use? I found my new broker-dealer/custodian useful for direction as to their minimum requirements in this area.

Once set up and working, we quickly realized that file sharing was another challenge we had to address. Our old firm had a local server we used for file sharing and computer backup, and without a server, we found ourselves wondering what to do. There are many cloud servers or file share providers, but we needed to find one that met both our need for file size and was compliant with our regulators.

Hopefully keeping these low-tech decisions in mind when considering a transition will improve the overall experience of your move. It would have helped us!

Christopher Rand is managing partner of FIDES Wealth Strategies Group.


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