"To gain maximum benefit from your data, it is crucial to ensure it is correct from the start."
It can help you understand the effectiveness and efficiency of your processes and be shared with partners and third-party systems to create automated, straight through processes, and used with clients to bring to life their financial plan, encouraging greater engagement.
Structuring data management properly has never been more important for advice businesses. Here are 10 top tips to help you maximise the value of your firm’s data.
1. Accuracy
To gain maximum benefit from your data, it is crucial to ensure it is correct from the start. Having a consistent system for formatting information is vital, along with standard procedures for checking your data. Standard workflows and procedures will help make sure that each data set is properly identified and logged consistently. Technology can help; using a back office system with agreed processes for data entry that flags any errors, will ensure the data is entered correctly, first time. It can then be re-purposed across the advice journey, reducing the risk of human error in rekeying information into multiple systems.
You can also enlist your clients’ support in ensuring their data is accurate and without gaps by asking them to complete the initial fact find, or fill in any missing information, via your client portal.
2. Accessibility
Once your data is accurately in your system, it needs to be accessible. Internally, advisers, paraplanners and administrators will need access at different points of the advice journey, while externally, your data is required to integrate with third-party systems and tools. Again, technology can do the heavy lifting, with modern back office systems enabling for seamless and secure data sharing. Rules can be programmed into the system to specify who has access to each of your data sets.
3. Functionality
The ability to share data paves the way for two-way integrations between your back office service provider and third-party partners and providers, to reduce time spent on valuations, quotes and cash flow modelling from hours to minutes. As well as saving administration time and reducing the potential for errors to creep in when re-keying data across multiple systems, it can also enable you to service more clients, driving revenue growth.
4. Security
Keeping your data in paper format, or even on hard drives represents a significant risk of loss or damage in the event of a disaster. Storing documents centrally in the cloud is a sensible disaster recovery strategy to ensure you can still access your data even if your device is stolen or the office is flooded. Big brand cloud storage providers, like Amazon, Google and Apple, all devote significant resources to data security, and leveraging that spend will demonstrate to clients, third-party suppliers and the regulator that you are treating your data with the utmost care and caution.
5. Delete
Retaining data unnecessarily creates several problems. It can be harder to find what you need if your systems are clogged up with superfluous information. You may difficulty with version control if you have more than one copy of the same document sitting on different devices or systems. It can also add to your storage costs if you are holding information needlessly. And most importantly, retaining personal data without good reason can land your firm in trouble with the Information Commissioner's Office for breach of GDPR rules. If you don’t need to keep it, delete it.
6. Understand
Having a thorough understanding of what data you hold, why you hold it, where it’s used and when it’s needed is crucial to determining how it can be best exploited to improve your business. At the same time, ensuring that everyone within the firm recognises the importance of the data you hold is critical to creating, processing, and maintaining quality information.
7. Strategy
Establishing a formal data strategy emphasizes the value you place on your data and is essential to cementing all your procedures for logging, maintaining, processing, storing and sharing it. It also creates a roadmap for how you intend to utilise your data to refine your advice process and inform decision-making for future business success.
8. Train
Training is an important part of reinforcing your data strategy and standard procedures and is key to establishing security protocols, for instance in detecting and avoiding email scams which are the cause of most data breaches. Proper staff training also demonstrates to your stakeholders the value you place on your data and that you have taken appropriate steps towards ensuring its ongoing accuracy and security.
9. Technology
Effective use of technology can make sure you fulfil your data strategy and help your firm realise the value of your data and drive revenue growth. Data management should therefore be key consideration when selecting any technology solution for your business. Before adding a new solution make sure that it can integrate with your favoured partners and providers, that it re-uses your data across your entire advice process and that it offers the best in security.
10. Regulation
Proper data management offers enormous benefits for your business, but it is also important for regulatory compliance. MiFIDII requires advice firms to ensure the accuracy of the client data they hold, which is another key reason to put procedures in place to make sure data is entered correctly from the start. GDPR also has rules around client data, with emphasis on security and processing and hefty penalties for breaches. Following the points above should go a long way to help you avoid falling foul of the regulations.
