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The Tricky Thing About Growth

What the latest mergers and acquisitions means to growing your business.

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The latest mergers and acquisitions across the financial services industry will affect the resources necessary to support company and employee growth.

The announcement of the $26 billion merger deal between Charles Schwab and TD Ameritrade. Goldman Sachs, with $427 billion under management, acquires United Capital for $750 million, all cash. Wentworth Management Services takes on a $2.7 billion assets under management firm Aurora Private Wealth. The RIA industry closed out 2019 with approximately 200 acquisitions, mainly stemming from an influx of capital being pumped in from private equity firms. In accordance with this substantial growth, SEC filings report that RIAs with a minimum of $1 billion in client assets has rose 54% in the last five years alone. The number of RIAs with $1 billion or more in client assets has grown 54% in the last five years, from 216 firms in 2014 to 338 firms in 2019, according to SEC filings.

2019 marked a year abundant with mergers and acquisitions, making the financial services industry ripe for new challenges. This new thriving environment of change marks an era with different needs, and changes that must happen to cater to its new growth. With industry consolidation underway, firms will continue to offer a more expansive array of services to meet the complex needs of their clients.

What Growth Means for the Clients

What does rising growth within the company mean for existing and new client relationships? Growth that occurs at a rapid rate threatens the quality of services, and clients are the first to inquire about these effects. Unlike steady, organic growth that occurs internally and over time, the sudden growth that occurs from mergers and acquisitions means details get lost, some services dismissed as unnecessary, and confusion as to which new processes reign. During such chaotic times, the focus can shift from the client’s needs to determining the appropriate business processes and even downsizing departments, which all inevitably affects the level of client service.

Financial companies will always experience growth, both organically and merged. That being said, once the dust settles, the client’s needs should always remain paramount. Clients expect the same personal attention and accessibility as before; despite growth, they do not want to get lost in the shuffle. Simply put, regardless of growth, client do not want to sacrifice thorough investment advice. Their expectations for direct and personal service remain constant, despite any merger or acquisition affecting the advisory business.

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Continued Focus on the Client

If companies maintain focus on servicing the client, these sudden types of growth carry many potential advantages and the level of product offerings to assist the client’s financial objectives. The combining of two companies allows both parties to obtain more resources than they would have on their own. More resources to invest means newer technologies implemented, more attention on streamlining workplace processes and returning value to the substantive and advisory needs of the client. In return, clients become privy to a wider offering and array of diverse products and services, access to those additional resources, latest innovations, a more global approach to investing, and advice geared towards personal goals.

As clients place a higher value on quality of service, other areas of financial services will require automation to permit more advisor accessibility. Many of the mundane tasks such as client onboarding and account management for day-to-day affairs will rely on workflow automation that takes the busy work out of the equation. Consequently, client-advisor relationships will become more fluid, removing the painstaking process of form-filling, repetitive questionnaires and updating forms. Instead, the focus returns on the relationship itself, and focus on a high level of services expected from an ever-growing advisory industry.

Digitization with Anvil

Anvil’s workflow automation software implements efficiency in the workplace. As companies merge and grow in both size and services offered, automation software keep companies current with their changing needs.

By delegating more monotonous and routine tasks to software like Anvil, companies can take advantage of their most valuable resources: human capital. By investing in talent and the people who possess it, ever-growing companies can better tend to their clients. The abundance of time spent on paperwork and PDFs for purely administrative purposes is left to software. The remaining time permits the advisor to hone in on substantive conversations, including those forecasting the client’s investment objectives and overall financial future.

Check out Anvil to learn more about automating your document-based processes.

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