One of the most complex and largest projects a Wealth Management firm will ever encounter, is if they wish to change wealth platform and custody provider. This project affects every department in their company and comes at a cost, both in time and money.
If a firm has got to the point they want to change providers, it is usually when the issues they are seeing daily, are significantly impacting their service to their clients, in a negative way. If the decision has been made to look at alternative providers, then this is one time where eternal expertise should definitely be used. External expertise is an additional cost, but it can be the difference between making the right choice of new provider or, wasting more money by selecting the wrong one and moving again in a few years.
So, what would an expert bring to the table and what does GOOD look like in an RFI process?
Experts, like ourselves at Common Sense Implementations, should bring the below:
- Their own in-depth knowledge of the market and providers. Knowing which providers may not be suitable to even be involved in the process, reducing time wastage.
- Their own set of specific questions as a starting point for the RFI, again reducing time wastage and saving the client’s budget.
- Questions to ask the client up front, to tailor and bespoke the RFI to fit in with, not only what they want their optimum current service to client to look like, but also what they want it to look like in 5, 10 years and beyond.
- Ability to run the RFI process, managing the final RFI creation, sending to providers, chasing of providers for responses in the required timeframes, ensuring the answers are completed and detailed.
- Provide an expert summary and analysis of the answers to help create a final shortlist for the client.
- Manage any follow-up meetings with the shortlisted providers to get the client to the point where they are comfortable to make a decision.
Where do you start?
Whether you engage with external expertise or do it “in-house” as maybe you are fortunate to have this expertise, the first starting question should be, “Do I really need to move vendor”?
This is an important question, before engaging in an RFI process, spending time and money, the current service and processes should be looked at to see if anything can be changed with the current provider. Questions should be asked like:
- Have we engaged with the provider enough to know these issues we see are not fixable?
- Are their issues with our own internal processes that, if changed, could make the service better?
- Do our staff have enough training to use the functionality they have; would more training improve service?
- Have we engaged with our clients enough to know what the genuine issues are?
These are just some of the key questions to ensure are answered first before moving to the next stage. If they have been answered, then the next two questions are key:
- What is the current provider doing wrong?
- What is the current provider doing right?
This second question often does not get thought of and is one an expert would and should bring to the table. The issues the current providers causes will be well known, people are suffering daily due to them. But what they do well gets overlooked because of the fact IT IS working well and so is almost invisible. What you do not want to do is move provider to remove the current issues, if they then create issues, you did not have before. What you want is for your new provider to do all the good things your current one does, remove the issues your current one causes AND provide new and better ways of working to help you service your clients better.
Answering these scoping questions helps tailor the RFI specific to Wealth Management firms needs to create an RFI which will cover:
- The service needed from a provider.
- The functionality needed from a provider.
- The relationship needed from a provider.
- Future proofing so that Wealth Management firm can deliver on its business plans and look to never have to move provider again.
The final RFI should not be war and peace. It should be concise to allow the vendors the time to truly provide the best answers they can, without taking months to complete, and provide the required information for the right decision to be made. RFI’s that have 500 questions do not help anyone and are not needed.
Technology is helping the RFI process and that is for another discussion paper.
Thank you for taking time in reading this article. Like any article of this nature, it is written from our viewpoint based on our experiences within the field. We are very much open to constructive discussion and debate on this or any topic, as collaboration between Change Specialists should ultimately lead to better project delivery outcomes for end clients. Plus, it makes common sense 😊.
