Tackling readers’ problems with CRM programs

Customer relationship management programs seem to be a hot button.

My last two columns on the subject triggered a flood of e-mails, mostly from advisers seeking advice, as well as several from vendors chiding me for not having mentioned their products.

Reader responses centered on a few issues. In this space, I’d like to tackle some common points of dissatisfaction and offer advice on how best to proceed. (For fuller responses to as many questions as I can get to over the coming days, see my blog at InvestmentNews.com/intech.)

Adviser dissatisfaction No. 1: Software that doesn’t live up to its billing.

A comment typical of many was from J.B. Wilson, who oversees all administrative and managerial aspects of client accounts as director of client service at Cornerstone Financial Strategies LLC. He wrote to say that his firm had been using Act4Advisors for about six years and has been having “multiple issues with it.”

Users of the software at the firm are Mr. Wilson, who is licensed to sell insurance, several support staff members and three representatives registered through its broker-dealer, LPL Financial.

“The structure of the program [Act4Advisors] itself is fine,” he said. “A big part of the issue we have with it probably has to do with the way our office operates.”

He explained that the Cornerstone team works as an ensemble, sharing clients. As a result, each client folder is shared, making keeping calendars up-to-date a big issue.

“The way you have to schedule things with clients is just not as clean, fluid or customizable as we would like it to be. It works, but it’s not an ideal solution,” Mr. Wilson said.

Another issue at Cornerstone is speed.

Since the firm’s server — a high-end PC — is three years old, it probably should be upgraded. Purchasing a dedicated server that comes with a few more gigabytes of RAM and a recent Intel or AMD processor would do the trick of speeding things up. But remember that Act4Advisors and other programs that run locally on your own hardware require hands-on maintenance and regular upgrades. Cornerstone keeps a consultant on contract for this purpose.

By contrast, many outsourced and web-based products are available on a monthly or annual pay-as-you-go basis with very high levels of reliability (99.9% is standard and you should accept nothing less, so make sure to read the fine print).

While the overall costs of outsourced or web-based software-as-a-service applications may be higher than running your own systems, significant first-year discounts are fairly common or can be negotiated. You are likely to find them to be more convenient, because you can log in from anywhere. They’re also more secure because you’ll be using a secure Internet connection and SSL encryption at the least (note the “https” versus the “http” when you use a secure site).

Using software as a service usually means you can do automatic backups online — a big timesaver — and that you no longer have to connect to your office and server through a virtual private network, which can be a headache to reconfigure if it goes down, often requiring a call to your IT consultant.

It is also interesting to note that Cornerstone’s advisers are satisfied with the web-based LPL BranchNet and WealthVision applications, the latter based on a version of eMoney Advisor.

Adviser dissatisfaction No. 2: Customization.

Cornerstone, for example, had considered Redtail Technology CRM and the version of Salesforce offered through LPL to address calendar issues. Neither option, in the opinion of the users, provided the depth of customization they wanted.

For many advisers, Microsoft Dynamics as a CRM choice would seem to solve the calendar issue without customization because it was designed from the ground up to operate seamlessly with Outlook.

But plain-vanilla Microsoft Dynamics, or even the version customized specifically for financial services, probably lacks the level of work flow customization many firms need.

Some overlay versions of Dynamics — highly customized versions sold by third-party companies — are tailored to financial advisers. Two that come to mind are the Advisor CRM module from Tamarac Inc., best known for its re-balancing application, and Crowe CRM for Wealth Management from Crowe Horwath LLP, which is intended for firms with up to 250 employees.

When buying CRM, therefore, my chief recommendation is one that many advisers and some vendors won’t like: Approach CRM shopping seriously, and thoroughly kick the tires.

Since every firm I’ve spoken to over the last four years does things differently, there is no universal CRM solution. Before making a choice, each firm must invest the necessary time to understand its work flow fully and — more importantly — document it. Next comes performing a trial with one or more of the CRM systems that most interest you. Only by test-driving these systems and spending time with them will you gain any certainty as to whether they fit your firm’s work flow.

Also, as I’ve urged in the past, network with fellow advisers. Use in-person meetings at conferences to ask what other firms are using and make use of social networking to do the same. Post questions to fellow advisers on LinkedIn, or within any of a dozen different advisory-focused groups on the site, and find out what others are using, what they’re happy with and what drives them crazy.

Narrow your choices of potential systems and negotiate a trial. The longer the trial you can stomach, the better. Any vendor that won’t negotiate or help you with this really doesn’t want your business.

Too many advisers spend more time shopping for a car than they spend on the technology that’s at the core of their firm’s operations. Does that make any sense?

E-mail Davis D. Janowski at [email protected].

Related Topics: Practice Management