Five key questions to ask before committing to financial planning software

Some of the recent events in the financial planning software space have highlighted the need for some serious conversations. There is no doubt that whether you are considering a move to a new software provider or even just thinking about recommitting to your current provider, that a software decision is a big deal. Your choice of technology will play a key role in how your practice is positioned to deal with the rapid pace of change that seems to be impacting every aspect of our industry.

In addition to the importance of choosing the right tech to drive your business, we also know that changing a core system like financial planning software is not an easy thing to do. A successful change management program to minimise business disruption and change ingrained habits is very often the difference between a successful change of providers and a failure.

So, given that changing providers is a critical decision and something that you don’t want to do very often, here are five key questions you need to ask before committing (or re-committing) to any particular financial planning software:

1. What am I trying to achieve?

Be very clear on what the key pain points are in your business. Have a clear view on what you will need to fix or improve to remain relevant and competitive. No system will be perfect so make sure your key issues are solved and that your ‘wins’ more than outweigh any potential losses. For example, if your key issues are achieving greater agility in business processes or greater efficiencies in client reviews then don’t get hung up on the fact that maybe a TTR with an annual reboot strategy might take an extra two minutes to do. Unless of course this is something that 90 per cent of your client base needs, in which case this should probably be one of your key pain points!

2. Who owns the client data and what happens to my data if a business fails?

Recently, some practices have told me that some software providers were asking to be paid to hand back their client data. Hold on a minute – your client data, is your data! Any situation where your software provider prevents you from having access to your data is simply unacceptable and an unfortunate reflection of the way that company views their own customers.


So, it should be a non-negotiable that you have access to your data at any time but what happens if your provider simply isn’t around anymore? What happens then? You need to ask the question and ensure that you receive a logical and practical answer. Perhaps even consider asking for a solution to be included in your contract.

Make no mistake, this is a critical issue and an inability to access your client data – even for a day or two – can cause irreparable issues for you with your clients, ASIC, your licensee, your staff and your business.

3. In a world of increasing customer centricity, how will my provider ensure that I can partner with my clients and not just service them?

Not only was all financial planning software not created equal, most of it wasn’t even created this decade! We don’t need industry guru’s to tell us that the world and our industry are becoming more client-centric by the month – we just need to make sure that at the heart of our tech solution sits a system capable of arming us for whatever our clients may expect of us tomorrow.

There is no doubt that financial planning businesses need a well-rounded technology tool set to get their job done. In order to make a decision about the technology that you will need tomorrow, you need to look back in time. Consider the origins of your software and home in on the DNA around which the software has been built. Are the future needs of clients and your business going to be best met by a system based around technical calculators or one built on client relationships? Of course, your financial planning software needs to do both – but it’s the fundamental building blocks (the DNA) of the software that will determine how well it can adapt and shine in an increasingly customer-centric world.

A truly customer-centric approach will result in a system that allows you to view wholistic client relationships including multiple different client entity types as well as relationships such as referral sources and accountants. You should be able to track and manage your lead pipeline, your review processes, your services and revenue and communicate seamlessly with all parties involved in the servicing of your clients.

4. What capability does the provider have for continual improvement and enhancements?

Software is a fast paced, rapidly changing game where tech behemoths tend to dominate. Evaluate carefully the capabilities of your provider to deliver meaningful continuous improvements and respond to your business needs. Marketing spiels are one thing but do actions and track records back up the rhetoric?

If rebuilds, refreshes, bug fixes, UX improvements and fundamental re-architecting are a company’s focus then even a relatively large development team is going to be consumed with just keeping the tech up to date. Up to date isn’t going to win you any medals. You need to satisfy yourself that your software is going to keep you ahead of the game and will continue to deliver relevant, timely and material improvements. If your software provider can’t demonstrate how they can leverage or compete with the ‘big boys’ of the tech world – then you are resigning your business to a future filled with bug fixes and enhancements that will take forever to be delivered. Tomorrow never comes.

5. What compliance framework is embedded in the solution, can it be automated and is it predictive or reactive?

In the same way that client centricity is a ‘must-have’, so is compliance. Yes, we all know that compliance can sometimes be viewed as boring and time consuming, but let’s face it, it’s a part of our industry that isn’t going anywhere anytime soon. It also happens to be something that not only keeps us in business but if it’s managed well should also provide us with valuable insights and proactive management tools to analyse our business and potential risks.

Key takeaways:

Making a decision on which financial planning software to use is a massive decision. Never be afraid to ask the hard questions and insist on getting understandable and practical answers to your questions. At the very least, satisfy yourself that staying with your existing provider or changing to a new provider will:

- Enable you to make material improvements to identified key areas/processes of your business;

- Allow you to retain access to your data – even in a worst-case scenario;

- Focus your business on growing and evolving with your clients as the centrepiece;

- Ensure that your business is keeping pace with the rapid pace of technology change; and

- Incorporates compliance not only as a backward facing reporting afterthought, but as a predictive, insightful business tool.

Mark Papendieck, business consultant, KR Consultancy

Five key questions to ask before committing to financial planning software
Mark Papendieck
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