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Episode 3: The overwhelming realities of adding a robo-platform

November 22, 2015 @ 1:36 pm

Runtime: 11:02

Adding a robo-element means more than flipping a switch. In this episode, coach Ray Sclafani asks advisers Matt and Nina some serious questions that give Matt more confidence in moving ahead with a robo, and open Nina’s eyes to the challenges ahead.

The Renovation Room

Industry experts and executives offer strategies, tips and ideas on how practices can improve their business.

Joseph V. Maugeri

Joseph V. Maugeri

Managing Director, Corporate Relations, CFP Board

Communications to clients and prospects will be key for this change. The message should focus not only on the “what, why and how” this changeover will take place, but also the benefits to the client. For example, if the client will receive more information regarding their portfolio that is easier to navigate and interpret, that needs to be spelled out. If the information will enable the advisor and client to make better use of their face-to-face meeting time, that should also be communicated.

The technology should be positioned as a compliment not a replacement to the relationship with the advisor and firm. Its ultimate aim is to improve the client experience by providing more information about their plan and portfolio that is easier to access and understand. In addition, it presumably will be offered in real time and allow clients to know where they stand on their performance and goals 24/7. This will allow the advisor more time to analyze and provide advice on this data, rather than compiling it and handling routine transactions (e.g. tax harvesting, rebalancing).

For the client, they should take away a clear message that the advisor is leveraging technology to produce better outcomes for the client, by automating more routine tasks. This will enhance the level of the advice they are receiving and allow for better conversations during their periodic review meetings.

Frank Maselli

Frank Maselli

Founder of The Financial Lifeguard Academy and The Maselli Group

I have a few thoughts on this but I have to say that I may be a lone voice of dissent. I think this is going to be a waste of time, money, and effort. It's just Nina's "shiny object" instinct. Robo is not a viable future for their practice IMO.

Hey, I totally understand the desire to market to younger clients with fewer assets and simpler needs. The older ones with real money and serious challenges are a lot harder to get! If the plan is to use robo to get new people in the door and then wait ten or twenty years until they become real clients...why are we doing this?

This all strikes me as a combination of fear of prospecting and lack of modern business growth skills in a pair of young advisors who are not well-aligned in their process or vision. Before I went a step further I would do a Kolbe A Index analysis on both of them and figure out what are the deep instincts and strengths that drive their success. And how can we bring them together.

Ironically, you heard Matt at the end of the video say that what makes him MOST comfortable is that Nina is LESS comfortable! If they can't come together, they're headed for disaster down the road.

But as a coach, you can only advise so much. Sometimes you need to let a client feel the pain of a bad choice themselves. So let's not debate the core decision anymore. Ray wants to take them to the marketing phase and this is certainly the fun part! How can we help them make it work?

I would go with a theme of "Robo tech with a human touch!" "The best of both worlds." "We give you the ease of a robo-platform but with the personal service and caring hand of an experienced advisor."

You could envision an ad with a terminator-like metal hand morphing into a soft human hand. Or maybe "Robo-PLUS" or "Robo 2.0"

Or "Going robo doesn't mean you're alone! Introducing Robo Plus with Archer Investment Management!"

They need to reach out to younger prospects who are just starting to think a bit more seriously about their investments. As well as perhaps older investors who want to take a look at the robo world yet still have a guide on the journey. They want to talk about a "spectrum of services" for those who need very little advisor help to the most sophisticated, wealth management situations.

The Raleigh/Triangle area is a great market. They should have no problem reaching new people in print, video or radio advertising. I don't know what other types of marketing they've done or might like to do. But my recommendation is designed to create some buzz and get prospects calling them. I would like to see them do a serious PR campaign with local media and press coverage. The whole idea of "Robo Plus" would be interesting, different and story-worthy. Of course we would hit social media pretty heavy as well.

Frankly, the marketing and messaging part is easy. I would like to see the technology in action before I did anything. If we get a serious buzz going but the tech fails or the experience is's game over! Let's make sure everything works perfectly before we launch into a campaign. Nina might be okay running out there and adjusting things on the fly. But launching process that's tested and proven is the only way Matt will ever feel comfortable.

Vanessa Oligino

Vanessa Oligino

Director, Business Performance Solutions, TD Ameritrade Institutional

“It seems that both the partners are not quite yet on the same page when it comes to implementing an online advice solution”

“Nina is excited about the possibilities, however, it seems she could spend a more time focusing on the details, in order to make sure that she knows exactly what it is she is signing up for. Matt, on the other hand, appears to be more conservative by nature and is still not ready to sign on the dotted line. I have full confidence that with guidance from the coaches they will reach a place where they are both ready to go.”

“So often we find when working with partners and teams that when there is a difference of opinion, the team members are not always able to appreciate the different ways each person is wired and how they approach decision-making. Nina and Matt both seem to understand each other, appreciate that their styles complement each other and understand that, like past challenges, they will be able to come to a joint decision they both agree upon.”

Kelly LaPalio

Kelly LaPalio

Vice President of National Accounts, FocusPoint Solutions

What a difference an episode makes! As partners and advisors servicing clients in the same thriving practice, it’s imperative that both Matt and Nina are on the same page about incorporating a robo solution. Their conversation with Ray has clearly made a necessary and significant impact on both their points of view. As one might expect, now that she has begun to dig deeper into the realities of what adding a robo would entail, Nina has scaled back her enthusiasm and begun to consider the practical, operational aspects of such a change.

Adding a robo is not a quick fix; I noted after the last episode that such a noteworthy business change requires careful and strategic planning prior to its implementation. As Ray points out, there needs to be a clearly outlined marketing plan and process in place to convey the new message to clients and prospects. On top of that and just as importantly, all advisors and staff need to be on board with that plan. Should Archer choose to move forward with a robo, all parties involved must feel educated, passionate, and excited about the new changes and technology they have chosen as a firm. In order for them to feel great about any major business change, clients need to sense a consistent message and enthusiasm from the team as a whole.

There are many more detailed questions that I’m sure Matt, Nina, and Ray will discuss which are specific to their business model and needs. Here are some examples of such questions:

• How would they communicate the new scenario to existing clients? (And would this be done in person or via other communication?)
• Which clients would be eligible or benefit from a robo solution? How would that selection process go? Who would Matt and Nina meet with first to describe the new robo solution? How would they service clients who have both robo and non-robo accounts?
• What would be their timeframe for implementation? How much operational assistance would they have from other service providers during such a move?
• How would they work with new clients if a robo were in the picture? Would the robo solution be a must, or simply an option for new clients who fit certain criteria?
• Given the SEC’s concerns related to fees and suitability, does Archer need to review their exisiting fee schedule and consider adjustments for a robo solution?

I think it’s incredible that both Matt and Nina are managing a successful practice today while looking forward to the future needs of their firm. This is not an easy task—especially when more than one advisor is involved in making such an important decision and feeling great about it. Often the daunting nature of incorporating major change sets advisors back to square one. I don’t sense this will be the case for Archer—whether or not they decide to use a robo solution for part of their practice. No matter what, having discussions about improving the longevity and evolution of their business can only add to their success, both today and in the long run.

It’s clear that Matt and Nina are both passionate about doing what’s best for their clients, continuing to service them at a very high level and maintaining these strong relationships. If and when they decide, together, to move forward with a robo solution, I’m certain that with careful planning, communication, and passion, they will be successful in its implementation. I’m looking forward to watching the next episode as they determine what’s best for Archer…and then begin create a strategy for what comes next


Your Practice Partner

Valuable information and assets provided by Broadridge Financial Solutions, this season's sponsor of Practice Makeover.

Prosper as a Breakout Advisor

The principals of Archer Investment Management, based in Raleigh, NC, took notice when robo-advising achieved triple-digit growth over the past year. Now they're tackling the critical question that's on the mind of today's advisory firms: is robo-advising right for me?

Defining and driving success

Matt Archer and Nina O'Neal are excited. They clearly see robo-advising as a fit for their young, forward-thinking business. However, as we listen to this conversation, it's clear that some vital questions remain. Perhaps the most critical: “How will you define success—and what measurements will drive it?”

A framework for strategic thinking

It's estimated that as many as 18% of RIAs* are planning to add robo-advising services to their firms over the next two years, and this episode provides great perspective on why this should be viewed as much more than a simple go/no-go decision. It also outlines key strategic questions you'll want to ask whenever you're weighing any new service or technology.

Technology and Relationships: Finding the Right Balance

As a financial advisor, you're in the relationship business. Like Matt Archer and Nina O'Neal of Archer Investments, you've built a practice based on credibility, respect and trust.

Robo-advising and other services

In Episode Four, Archer Investment's Nina O'Neal and Matt Archer meet with technology expert Aaron Klein. He provides guidance on specific functions, parameters and tiers of service, and that prompts Nina to push back.


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