The operations team is vital to your firm’s ability to deliver excellent client service. However, its efforts tend to happen behind the scenes. The operations staff usually isn’t in the spotlight unless something has gone wrong, and few firms go through the effort of reaching out to them proactively. That’s unfortunate, because there is tremendous value in having an open conversation with your operations staff.
Since these discussions are not driven by an emergency, there will be more time to think about system and process efficiency. You will be able to brainstorm ideas for operational improvements or consider how to respond to business interruptions. There are many ways to wisely use the time with your operations staff. Structuring the agenda around interesting questions is a great way to get the conversation going in the right direction.
Here are five thought-provoking questions to help you start a productive operations conversation.
Continuous improvement is the key to remaining relevant and maintaining a competitive edge. If a firm’s operations are the same or worse today than they were two years ago, then the organization is compromising its efficiency. The stand-still may not have affected your ability to attract and service clients yet, but it certainly will in the future.
If your staff doesn’t report an improvement in operations over the past two years, here are some additional brainstorming questions to turn this discovery into actionable business intelligence.
-Which specific operational areas or workflows are the same or worse?
-What are some of the most frequently requested upgrades or workarounds, especially from the newer members of your team?
-Where would you most like to see improvements?
-Where are you spending most of your time?
-Have your business requirements changed?
Natural disasters aren’t the only causes of business interruptions. Inclement weather, staff illness or burst pipes – any of these crises could wreak havoc, especially if your company doesn’t have a set of business continuity guidelines.
When reviewing your firm’s business continuity procedures, make sure they include these key points:
-Data Recovery Site Preparation – Details on the data recovery site should include the specifics on generators, backup servers and Internet access. How will you synch your work back to your live environment after the emergency is over?
-Vendor Disaster Recovery Planning – Remember that business continuity planning extends beyond your own facilities. Do not rely on your vendors to provide data recovery without performing due diligence. If vendor data recovery is part of your business continuity plan, it must be reviewed and tested!
-Backup Employee Assignments – Define the process for transitioning assignments to a backup when an employee is sick, on vacation or on extended leave.
-Workflow Coverage Review – Document the approach to prioritizing workflows in the event of business interruption. What processes and tasks can be delayed without loss of client trust or accuracy? Which workflows are critical to the firm’s continued operations?
-Operations Manual Review – Treat your operations manual as a living document by reviewing and revising it on a regular basis. If you are unsure of how well the procedure manual reflects the actual state of operations, ask a newer employee to review the write-up and comment on points that don’t line up with how things are actually done.
The last point is relevant beyond business continuity in the event of an emergency. Well-written, current and accurate procedures can facilitate staff training, foster transparency and help your firm respond to SEC audit requests. If you would like a sample template that outlines an effective set of operating procedures, email our team at Accusource for a complimentary copy. [Here]
If your answer is “100 percent of our transactions are automated,” chances are you are wrong.
Having some manual adjustments and transactions is common within most firms’ workflows. Manual adjustments aren’t necessarily problematic, but lack of awareness about them and lack of proper controls can potentially expose the firm to additional risk. Eliminating all manual interventions is an unreasonable goal for most firms. Making an inventory and minimizing them is more realistic and could prove to be a worthwhile effort.
Some instances of manual workflows, such as setting up new accounts or securities, are normal and expected. With proper error prevention and detection controls, the risk to the firm is likely minimal and well-managed. However, if your team is investing considerable time in fixing buys and sells or adjusting interest, it’s a bad sign that could point to a systemic problem. In that case, you may have to go back to the basics by documenting the workflow, identifying the source of inaccuracies and looking for ways to fix the core issue.
Accurate understanding of workflows and manual interventions is a critical prerequisite for being able to manage them effectively. At Accusource, this question is a standard part of our transaction analysis process. While we were running this process for a prospective client recently, the client’s team was adamant that all of their workflows were fully automated. Of course, they were quite surprised when our analysis showed that almost half of their interest transactions required manual intervention to complete!
If you are unsure about the percentage of your firm’s workflows that are fully automated, Accusource will review a recent transaction summary report at no charge. Just send us an email and our team will help you get started. [Here]
The answer for most companies would be “Yes!” The complexity of manual accounts is driven by exposure to human error, limited report availability and frequent lack of accuracy. Unless workflows are fully documented and linked to a checklist as part of company-wide controls, manual accounts could create bottlenecks at period-end close, hold up client statements and generate errors.
Some firms get so frustrated with the amount of effort required to maintain manual accounts that they consider not offering them at all. If your team struggles with this issue, it’s important to remember that the ability to service manual accounts is a valuable offering for both clients and the firm. However, this value must be balanced against the amount of time and effort that they consume.
How can your firm better manage manual accounts? Sometimes, lowering the priority and urgency of manual account reconciliation in the month-end close process is the best decision. In other situations, outsourcing is the answer. , can step in to aggregate and reconcile manual accounts daily, which can lift the burden from your operations team and provide better timeliness and accuracy.
Today’s wealth management firms have access to an unprecedented range of technology solutions. Some choose a fully integrated end-to-end platform, while others approach their technology stack as a puzzle, picking and choosing the best software components to meet their needs. You might imagine that having the best technology is the solution to all operational issues, but in our experience, that isn’t the case.
Many firms aren’t even close to maximizing the use of their current technology because they don’t have a grasp on the full suite of tools, reports and automated workflows that’s available to them. It’s not uncommon for firms to plug the perceived or real gaps in reporting with home-grown Excel spreadsheets that can be riddled with mistakes and difficult to secure. While that work-around may get them quick results, it’s far from efficient.
If your team is frustrated with a workflow or process that is seemingly impossible within your reporting system, reach out to your current vendors’ support resources. The solution may already exist right under your nose. Even if you already have in-house technology support, opinions from outside professionals that have seen hundreds of workflows can save your team time and money.
The time and thought invested into open conversations with your operations team can deliver excellent ROI. However, you must be prepared for a few uncomfortable discoveries along the way. Perhaps you find out that your team is spending hours every month on fixing automated feeds and booking manual adjustments. Or maybe you dust off that procedure manual and learn that it hasn’t been updated in seven years. Remember that knowing about these issues is better than staying in the dark!
Finally, keep in mind that you don’t have to solve these tough challenges on your own. The Accusource team’s expertise can shorten your learning curve and help focus your efforts, so please contact us to get a copy of a sample procedure manual, review a transaction report, or talk about how we can help your operations team gain efficiencies and eliminate frustrations.