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Compliance Technology: The Quest for the Ideal Solution

This is the fourth in a series of blog posts by Mitch Avnet of Compliance Risk Concepts on the process of building a business case within your firm to support investment in compliance technology. Read part one herepart two here and part three here.

Today’s digital landscape is not as straightforward as it was just five years ago, even in the compliance space. It seems every day more vendors enter the scene with new apps and systems.

This can be good for the industry as the commoditization of digital products should lead to lower costs. However, having so many choices can also further complicate what is already a complex process. If you’re a compliance officer searching for the right solution for your own firm, there’s no easy answer.

At first glance, it might seem safest to go with one of the “tried and true” software systems that have ruled the market through the years. Unless you’re starting from scratch, the prospect of throwing out the systems already in place to bring in a new platform might mean more disruption than your C-Suite has the appetite for. And when you’ve completed your gap analysis, you may find it’s not necessary.

Don’t skip the gap analysis

Within the industry, we all comply with the same regulatory standards, but not all firms arrive at compliance in the same way. Operational systems and structures among firms vary widely, resulting in each firm facing its own unique set of digital transformation needs. You might find yours are comparatively simple. In that case, looking at point solutions from smaller vendors who are new to the market could offer you the best choices.

In an earlier post, we discussed the fact that there are two types of gaps in a system you must address – gaps in workflows and gaps in technology. Regardless of the amazing superpowers of the digital solution you ultimately choose, it won’t matter if you haven’t located and addressed the gaps in your processes first. Initiating this assessment will help you determine whether you’re looking at a large, integrated, multi-pronged solution, or whether a few smaller cloud-based apps can solve your issues – or both.

Stop looking for one solution

The search for the Holy Grail – the one program that can solve all your problems – is still underway. As a compliance expert who spends all day, every day, evaluating digital compliance-related solutions, I can say authoritatively that no such solution exists, and likely never will.

Remember the previous sentence when you begin to talk with salespeople. I’ve known clients and colleagues who took the word of product reps when they claimed their solution could handle all the firm’s issues – or it would, with just a little fix by the developers, “no big deal”. Agreements were signed, funds were transferred. But when the implementation team arrived, the product couldn’t do what the salesperson promised, and making that ‘little fix’ required a new Statement of Work.

Worry about integration

There are a lot of great products on the market and you may find one that gets you 60 to 70 percent of the way to a complete solution. Chances are, however, you will always need to rely on more than one point solution targeted toward the unique requirements within your organization. That’s when a product’s integration capabilities become critical.

I’ve seen professionals practicing what I call ‘swivel chair compliance’ – the need to swivel back and forth between apps and systems because the programs are unable to talk to each other. Trusting the accuracy of your firm’s compliance status to manual processes is no way to manage risk.

To achieve the ultimate digital goal, a more efficient system that frees your compliance professionals to focus on higher-order work, you need a solid ecosystem of integrated programs that can communicate and share data across platforms. Make sure the products you’re considering have that ability. And do not trust the salesperson’s word for it – make them prove it.

Vet the vendor

Lastly, perform due diligence on the vendors you’re considering. This is a major, highly visible investment in your firm’s future operation. Be sure the vendors you recommend to your board or committee have the financial and technical wherewithal to support you well into the future. Even if a product is being hailed as the next best thing, don’t take the hype at face value. If even one of your vendors goes out of business in the next couple of years, it will cause major problems in your tightly integrated ecosystem.

Technology vendor due diligence is an exhausting process if you do it right; it should be! You may have an internal team capable of performing the assessment or you can call in a consultant with expertise in compliance issues. Either way, be sure it’s done so you can face a more efficient and productive future with confidence.

In the Spotlight: Renee Corwin, Corwin-Rey Insurance Agency

Running two successful office locations is no easy feat. It also means double the territory size. Making your clients feel connected to you while you are unable to be physically in front of them is not always an easy task.

Each month we put the spotlight on a customer who’s fully embraced digital transformation. We’ll share stories of advisors and agents who are using digital to be more productive, build deeper relationships and increase business, as well as those of distribution, marketing, compliance and IT leaders who successfully led or participated in digital initiatives.

Renee Corwin is the owner of the Corwin-Rey Insurance Agency in Washington. She uses Hearsay Social to schedule quality content, keep a watchful eye on her clients and prospects for life changes, and strategize with her team to create their digital marketing plan. Read on to hear how social media has impacted Renee’s business.

What’s a typical day like for you?

I typically like to get to work before we open, to filter emails and get my day organized. We all get caught up in the day-to-day routine, putting out fires, but I have dedicated time on my calendar for certain things that I truly try not to waiver from. For example, every Thursday I do at least one thing on my digital/social media calendar. I may update Google My Business photos/videos, schedule posts through Hearsay, write a blog post, or update my Agency website. I found that if I did not dedicate specific time to these things, they would fall through the cracks and never get done; it’s easy to shove them to the back burner.

What trends are you seeing in the industry lately?

A trend that I’m seeing is a lack of loyalty from our customers; more specifically, the children of our long-time customers. It used to be simple – when a child would get married or move out, we would always write up their insurance policy. However, in the past year or so we have noticed these young adults are shopping online and really searching based on price instead of value. Regardless of the relationship we had with them and their parents.

How are social media and texting changing the way you work?

Convenience and connection are key for our customers. We have to be able to communicate with them in the manner they want to communicate. Be it by phone, email, texting, social media –we have to be present everywhere. Social media and texting certainly make it much easier to communicate in a rapid manner. Social media has also helped with our retention of long term customers. Even when customers are shopping for value only, they love having a connection with someone, or a perceived connection, via social media.  They like to be a part of our lives, and us a part of their lives.

How has Hearsay improved the way you work?

Hearsay allows us to plan ahead, schedule posts, and creates/helps us with our marketing plans. I love personalizing our own content but being able to efficiently schedule posts out into the future makes sure we are always reaching our audience.

What best practice have you adopted?

Make sure all of your contact info is visible on your social media sites and websites. Every platform that you have, you need to make sure your connections can contact you. Use social media to do your research on prospects and clients. People won’t always offer up information on the phone that they are posting on their social media sites. You can stay up-to-date with people based on life signals that you wouldn’t know were happening unless they called and told you (which is highly unlikely). For example, I saw a friend bought a home and called them to make sure they were covered on homeowners insurance. This alone has led to a lot of client retention.

What myths would you like to dispel about social media?

That it’s only young people on social media. My 82-year-old mother uses Facebook frequently. She comments, crowdsources, and interacts on Facebook. It’s not just young people.

What results have you seen from adopting social media in your business?

I’ve trained my staff to always ask how people heard of us which helps track the metrics. 75% of our new business has found us because of our digital presence.

When you’re not at the office, what do you do for fun?

I love hiking, running, traveling, and in the past few years I took up a childhood dream of learning how to play the harp.

2019 Social Trends for the Digital Advisor or Agent


With a new year comes new social and digital trends. Hearsay CEO Clara Shih wrote a thought-provoking piece on what 2019 will hold in store for advisors in terms of technology trends over at WealthManagement.com. She says:
“In these turbulent market times, technology advancements used to amplify advisors’ human touch will matter more than during bull markets, and will define client relationships to years to come.”
One way technological advancements can amplify advisors (and all financial service professionals) is through social and digital communication channels. Here are four trends that will define your client relationships.

Trend 1: 1-on-1 Messaging

The recent news that Facebook is extending its messaging platform to Instagram and WhatsApp for an integrated experience is just the most recent example of the growing importance of 1-on-1 messaging. With this confluence, there will be 2.6 billion users who can suddenly all contact each other through, regardless of which platform they’re messaging on. While not every social and digital platform can do the same, this proves that the relevancy of 1-on-1 messaging will continue to grow.
Revisit your 1-on-1 messaging strategy: social media DMs, text messages, phone calls, email. Keep track of leads you’ve nurtured and send an email/text when the time is right. Many of you are probably already doing this today, but it doesn’t hurt to codify this further and focus more effort into this bucket. By automating other top of funnel activities, such as posting on social media and managing lead forms on your website, then you’ll have more time to spend on high-value 1-to-1 interactions with clients.

Trend 2: Build Trust

The past few years have been rocked by a crumbling trust in our social media networks. While most issues were with Facebook, including but not limited to Cambridge Analytica, fake news, and fake profiles found on the network, Twitter had its fair share of drama too with its use of bots and fake accounts. Trust is an ongoing conversation that those on the forefront of digital have to constantly keep in mind.
Building the lost trust back up on social media will require a massive effort from many folks, the social networks especially, but there are day-to-day activities that you can do to establish trust as well. Post personal and authentic content that shows a different side of your business. This could be posting images of the folks in your office volunteering or going to social events together. Some agents and advisors also post about their personal lives and families! Just be careful not to post anything that might be unprofessional and hurt your brand.

Trend 3: Real-Time Content Grows

Facebook and Instagram Stories and various live streaming features point to continued growth in real-time content. The continuing trend of real-time content is actually a branch of the conversation about trust. Folks are craving real-time content because it feels more authentic and real. We’ve seen the idea of real-time content productized in social media platforms through the use of Facebook and Instagram Stories. You also see it in the continued growth of live streaming on these platforms and others.
Create posts that mimic real-time content. Do this by posting content about current trends and events. Even if the post goes out a few days or a week after the news or trend first hits, your followers can still tell that you’re paying attention to the latest happenings and are savvy enough to comment on it. Think of it as being fashionably late or taking a moment to gather your thoughts on the subject before sharing.

Trend 4: Digital Connectivity

A lead goes to your website and fills out a contact form. You follow up with an email to schedule a meeting. After your meeting, you send a text thanking them for their time. Later on, you see they retweeted one of your tweets about market fluctuations. You send them a text, “Hey, thanks for retweeting. Call me if you have any questions about market fluctuations.” After your phone call, you send them an email with some follow-up information. As the digital landscape becomes more complex, so do your digital relationships with your customers and prospects. This opens up a world of possibility for your communication methods, but can also become a heady thing to manage.
Ensure whatever platform you’re using for digital communication can seamlessly connect all of these touchpoints. Look for solutions that can automate this process. Hearsay, for example, can automate the entire scenario described above!

Learn More

If you’re a Hearsay customer and would like a deeper dive into these four trends and how they apply to your business, check out our upcoming webinar “2019 Social & Digital Trends”.
In this live webinar, advisors and agents will hear directly from Hearsay’s Customer Education Executive Chris Beck about the latest trends in social and digital and how you can incorporate key findings into your approach.
Cut through the noise and get straight to the point: what are the key 2019 digital trends to look out for? How can you leverage them for your business?
Sign up now for one of our upcoming advisor & agent webinars, and get the foundation for your digital strategy ready to go by the end of the session:
Wed, Feb 20, 2019, 11:00 AM PST
Tue, Feb 26, 2019, 8:00 AM PST

2019: The Year of the Resurgence of the Financial Advisor, With Technology’s Help

advisor mobile technology
As we start the new year, feelings of both anticipation and anxiety are palpable for many Americans. Uncertainty reflected both in this country and across the globe are challenging financial markets, and the economy is looking unsettled for the first time in years.
With this as the backdrop, the financial services industry will have its fair share of challenges in 2019, but there are exciting opportunities also. In these turbulent market times, technology advancements used to amplify advisors’ human touch will matter more than during bull markets and will define client relationships to years to come. Here are three areas that will be top of mind for advisors and advisor firms in the new year:

1. Shift from Data to Insights and Action

The amount of data amassed on a yearly basis is staggering. According to a PwC research report, by 2020, we could see 44 zettabytes of data created annually. Financial services firms are investing heavily in data systems and predictive analytics, with multiple applications including security, fraud and client experience and personalization.
In theory, putting data to work with the right tools should help deliver the advice clients need at precisely the right moment. But it’s been easier said than done. For one, many advisors ignore so-called “next best actions” because the suggestions aren’t very good or performing the actions requires too many arduous steps. Firms have also tried to deliver these nudges directly to consumers through emails and app notifications, but the follow-through rate on automated suggestions is a few single-digit percentage points at best, compared to over 50 percent follow-through from a human advisor nudge, according to the Chief Product Officer of a popular robo advisor (which brings us to the next prediction). Perhaps 2019 is the year that data-driven advisor nudges will become viable.

2. Robo Advisors Will Cease to Exist on Their Own

Despite over $2 billion of venture capital flowing into robo advice startups, the hype about human advisors getting replaced by algorithms has simply not played out. There has not been an exodus of either boomer or millennial clients leaving their human advisors for apps. A 2017 study by LendEDU revealed that only about one-fourth of millennials polled had used a robo advisor. Almost 70 percent responded that a human advisor would give them a better return on their money, while two-thirds believed a robo advisor would be more likely to lose their money than a human advisor.
Many robo startups have closed or exitedhired human advisors, and/or gone the B2B route selling their software to advisors. Large established players like Vanguard, Schwab, and Morgan Stanley have built their own automated investment algorithms to bolster their core business.
Robos will continue to be challenged in 2019. First, they are untested in a down market. Most were developed post-2008 and it remains to be seen how they will perform in a significantly volatile market like the one we are starting to experience. Will they be able to adjust fast enough or provide enough guidance, flexibility, and personalization to meet antsy investors’ specific needs?
Second, investing is a highly personal and complex task in which emotion plays a big part. Human beings don’t bet their family’s financial future on the accuracy of a faceless algorithm. As they experience ups and downs and as the market fluctuates, investors are voting with their assets that they prefer to have a trusted person help them manage through it.
I predict that in 2019, robos will solidify as software utilized by advisors, rather than replace advisors. It’s a great example of how people can leverage AI and machine learning to free up their time, upskill, and focus on higher order work. We’ll soon see a model that combines robo efficiency with the human touch as today’s robo advisors morph into something more akin to a modern assistant.

3. Digital Basics, Like Texting Clients During a Major Market Event, Will Go a Long Way (no AI required)

With all this talk of data, AI and machine learning, it’s easy to get out over our skis. In fact, in 2019 and probably for at least a few years beyond, tremendous productivity gains and differentiation will come simply from digital basics like e-signature and text messaging. Unfortunately, advisors have been hamstrung due to growing regulations and slow-moving, risk-averse firms.
Take mobile, for instance. Today’s expectation is that everyone has a mobile device and everyone texts. Clients are used to getting answers quickly. They don’t want to play phone tag or trade voicemails, especially when it comes to their finances. Clients don’t understand why they can’t text their advisor.
Regulators have taken note. In December, the SEC issued a risk alert on advisors texting, Hearsay saw unprecedented demand for our compliant texting solution. New technology enables firms and advisors to mitigate risks and comply with record-keeping, advertising, suitability, supervision and security rules – and it all runs in the background so advisors can focus on connecting with clients on a human level during moments that matter.
Expect to see client-advisor relationships change for the better as advisors embrace the basics and continue digitizing manual processes this year.
With technology, financial professionals can increase the frequency and quality of client touchpoints, stripping out the manual inefficiencies and becoming more tailored in their outreach. Less time will be spent manually building individual portfolios and more time will be spent engaging with clients to address relevant market trends, life goals and opportunities.

The Final Word

The year ahead underscores a resurgence of the human advisor, thanks to the development of new technologies that enhance rather than replace the human touch. Volatile markets will test relationships as people inevitably stress over their financial future, and more than ever, the trust and empathy of an advisor enhanced with data and convenience will serve to establish lasting client trust, differentiation, and loyalty.
So, while the market could get wild in the coming months, the financial services industry has much to look forward to in the days to come.
Originally published on WealthManagement.com.