Strategy Trumps Spend When It Comes to Effective Deployment of Technology Says New Schwab Report for Independent Investment Advisors

Friday, October 1, 2010 10:00 am PDT



Public Company Information:

"We know from our 2010 RIA Benchmarking Study that 95 percent of advisors are looking to technology to increase efficiency, and that 88 percent of them have already purchased technology with an eye toward enhancing client service so this is clearly a topic of great interest to the advisors we serve."

SAN FRANCISCO--(BUSINESS WIRE)--Independent registered investment advisors (RIAs) who actively manage their technology investments generate more income and spend considerably less on technology, according to a new report from Charles Schwab Advisor Services. Using results from the 2010 RIA Benchmarking Study and additional interviews with advisors, Integrating Technology into Your Practice: Keys to Improving Productivity divides advisors into two types: those that have a strategic approach to technology and those that take a more passive approach. The study shows that the strategic advisors spend half as much on technology and are twice as profitable compared to the biggest technology spenders (top 20%) of the more passive firms. In addition, the report finds that firms who embed technology into their business and operations see greater productivity and profitability gains, as well as lower client acquisition costs.

“Our research reveals that advisors who view technology as a critical part of the firm’s business strategy benefit the most from that technology and see real financial results,” says Neesha Hathi, vice president of Advisor Technology Solutions at Charles Schwab, a leading provider of custodial, operational and trading support for more than 6,000 independent RIAs. “However, even when there is an appetite for doing so, integration and implementation are challenging for many firms. This report allows advisors to benefit from how the most successful firms approach technology.”

She added, “We know from our 2010 RIA Benchmarking Study that 95 percent of advisors are looking to technology to increase efficiency, and that 88 percent of them have already purchased technology with an eye toward enhancing client service so this is clearly a topic of great interest to the advisors we serve.”

Integrating Technology into Your Practice, part of the Schwab Market Knowledge Tools® (MKT) series, identifies important technology trends that can help RIAs get more from their technology investments and includes strategies and best practices to help improve productivity, service and the overall client experience. The report provides an overview of:

  • Key emerging trends in technology for RIAs
  • Key success drivers for marrying technology with business strategy
  • Integration approaches, issues and benefits
  • How technology can enhance client experience

Integration – Enabler and Roadblock to Increased Productivity

According to Schwab’s 2010 RIA Benchmarking Study, the top three technology challenges facing advisors are (1) integration, (2) selecting the right vendors or solutions and (3) implementing changes into workflows or processes. Even though many of today’s technology applications are highly customizable by task or function, there is limited cross-system functionality.

According to the Schwab report, in order to get the most out of their technology investment, RIAs should focus on two areas: integrating process workflows into a Customer Relationship Management (CRM) system and integrating key systems such as CRM, portfolio accounting and document management. Schwab’s research found that when firms integrated at least one workflow and one other system with their CRM, they were more than twice as satisfied with their CRM. Integration yields bottom line results as well: more than 40 percent of firms with high levels of CRM integration report time/productivity savings of more than 20 percent.

Advisors who custody with Schwab now have access to a synopsis of the full MKT report, which will be available in late October. Advisors attending Schwab’s IMPACT® 2010 Conference will be able to pick up a flash drive containing the full report at the Schwab Center. IMPACT 2010 takes place from October 26-29 in Boston, Massachusetts, at the Boston Convention and Exhibition Center.

In addition to the report, advisors who attend IMPACT can stay current on how technology can boost productivity by attending the following sessions:

  • Technology Insights and Best Practices from the Schwab 2010 RIA Benchmarking Study: Led by Schwab Technology Consultants Adam Moseley and Wade Spencer, this session will focus on best practices for technology use and spending gleaned from Schwab’s research, as well as insights from consultations with advisors.
  • Schwab Intelligent Integration: Reshaping the Advisor Workflow with CRM Integration: Led by Neesha Hathi, this session will focus on illustrating how high quality integration with a CRM system can help firms drive productivity and enhance client service.

Click here for a video message from Neesha Hathi about what advisors can expect to see and learn at IMPACT 2010 or see the video here:

For more information about IMPACT 2010, advisors can visit

For more information about the MKT Report or any of Schwab’s resources to help boost productivity, advisors can contact their Schwab relationship manager or visit

About Schwab Market Knowledge Tools® (MKT) Reports

The Schwab Market Knowledge Tools series is an ongoing program of industry research reports, white papers and guides from Charles Schwab designed to keep investment advisors on the forefront of trends and competitive challenges facing the industry today. Offered exclusively to Charles Schwab’s valued clients, the Schwab MKT program delivers the kind of relevant and timely information needed for future business planning. Information provided is for general informational purposes only and is not intended to provide specific financial, compliance, regulatory or legal advice. Schwab makes no representations about the accuracy of the information or its appropriateness for any given situation. For further information, please contact your legal counsel.

About RIA Benchmarking Study

Schwab’s annual RIA Benchmarking Study, the largest study of its kind focusing exclusively on RIAs, captures trends and best practices in the RIA industry based on the experiences of individual firms. This year’s study represents the views of 870 firms who (as of the end of 2009) managed more than $300 billion in combined assets.

Responses were collected during February and March of 2010. All data is self-reported by study participants and is not verified or validated.

Independent investment advisors are not owned, affiliated with or supervised by Schwab.

About Charles Schwab

The Charles Schwab Corporation (NYSE:SCHW) is a leading provider of financial services, with more than 300 offices and 7.9 million client brokerage accounts, 1.5 million corporate retirement plan participants, 824,000 banking accounts, and $1.4 trillion in client assets. Through its operating subsidiaries, the company provides a full range of securities brokerage, banking, money management and financial advisory services to individual investors and independent investment advisors. Its broker-dealer subsidiary, Charles Schwab & Co., Inc. (member SIPC,, and affiliates offer a complete range of investment services and products including an extensive selection of mutual funds; financial planning and investment advice; retirement plan and equity compensation plan services; referrals to independent fee-based investment advisors; and custodial, operational and trading support for independent, fee-based investment advisors through its Advisor Services division. Its banking subsidiary, Charles Schwab Bank (member FDIC and an Equal Housing Lender), provides banking and mortgage services and products. More information is available at and (0910-6247)

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Charles Schwab
Lindsay Tiles, 415-667-0479
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Neesha Hathi, vice president, Advisor Technology Solutions at Charles Schwab (Photo: Business Wire)

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