Client management systems can open up a host of online services to make firms more competitive, says Ian Muirhead. Ian Muirhead is head of Sifa.
The march of IT has not passed the financial services sector by. Using in-house client management systems and hooking up to the latest online services, solicitors can more than hold their own in the wider financial market.
Keeping detailed client data is crucial in many fields of work, but it is particularly important in the financial services sector as a basis for both compliance and future contact. It also gives firms a head start when developing computerised record keeping and database marketing systems.
This is because at the heart of all such client management systems lies a database containing, as a minimum, clients' personal contact and family details, employment record, earnings and tax status, house and mortgage information, investments history, particulars of other professional advisers, and a summary of objectives and attitude to investment risk.
The advantage of holding this information on a computer is that it need never be re-entered on application forms and can be transported automatically into other software applications, such as calculators, client reports, valuations and tax returns.
There are a number of client management systems on the market, some of which have a bias towards packaged investment products, and others aimed towards securities work.
When choosing a system, the same general IT selection rules apply. Assessing the financial standing of the software vendor and the quality of after-sales support it offers is important, as is choosing a system that runs on the industry-standard platform, Microsoft Windows.
Financial services systems usually stand alone from the office computer network, and client contact data is fed in from other parts of the firm and then expanded.
One of the main reasons for maintaining the system separately is that financial services terminals will usually be connected – via a modem – to one or a number of remote quotation or information services.
The most important of the firms offering such services is The Insurance Exchange, which provides online advice on life and pensions policies and collective investments. As well as supplying quotations, its latest development, known as the Common Trading Platform, allows data and proposal forms to be sent in an interactive environment.
Financial advisers often link up with The Insurance Exchange before acquiring a client management software system. The cost of linking up is a reasonable £250. Of course, coupled with an in-house system (all the main packages integrate with The Exchange), the process of calling down quotations without having to re-key information which is already contained in the software factfind greatly simplifies the process.
To take full advantage of the interactive services, however, users are recommended to use PCs with a minimum of a Pentium P133 processor and 24Mb of RAM.
Financial advisers are now required to provide "key features" information to clients for whom they arrange collective investments, and several new software providers have begun to offer this information online.
Using such a service will clearly cut down the need for hard copies of product information, but some financial advisers are understandably reluctant to import yet another piece of software and no doubt expect that, in time, a similar service will be available through The Exchange.
Apart from client management, the other area of software development has been in the field of best advice. A number of software houses offer access to product databases, either online or via floppy disk. In-depth information can be obtained on a vast range of up to 30,000 investment products available in the UK, according to many different criteria.
The manner in which this information is presented varies. Some systems are "front office", for use in client meetings, while others are designed primarily as "back office" research aids – although the latters' ability to present information in the form of pie charts, bar charts and comparative tables can be very persuasive to clients, too.
It is through these IT developments that the providers of financial services products to independent advisers are driving down costs to the levels already achieved by the banks selling insurance.
The Solicitors Independent Financial Advisers' (Sifa) Advisory Panel has recently reviewed the systems available and identified the Plum Client Management system and the Aequos Best Advice system as being particularly appropriate to the needs of solicitor independent financial advisers. Sifa has negotiated preferential terms with the providers of these systems for members of the Sifa Network. For details about Sifa Network membership, call 01372 721172.