Data silos continue to be an omnipresent challenge, resulting from years’ worth of broker-dealers, RIAs and other firms acquiring more department-focused software to run their operations. The more software used by different teams throughout the firm, the more disparate data emerged, making it difficult to find, aggregate and access the right, normalized data when and where it is needed. Receiving data from different sources on a regular basis also exacerbates to the problem.

Regulations continue to evolve, and a greater extent of core business processes, workflows and operations are driven by data. Firms lacking transparency into their own core business data increases operational, compliance and audit risk. Capital markets and advisory firms must also be able to respond faster to investor needs in today’s volatile markets, while remote workforces require workflows and processes to be efficient, paperless and secure.

Here are five reasons why broker-dealers and RIAs must overcome the data silos challenge without delay, and the advantages of technology platforms that successfully combine data and functionality onto one cloud-based operations environment.

1. Data Aggregation = Confidence

A comprehensive data aggregation capability gives firms the confidence that they can meet regulatory and audit requirements accurately and on time, while supporting advisors and service delivery. Driven by the data demands of managing advisor compliance and commission requirements, bringing together data and functionality onto one platform is needed to manage the process, from advisor and client onboarding, to meeting all compliance checkpoints, supervision, and commission payouts.

2. Reduced Compliance & Audit Risk

A firm’s ability to meet regulatory requirements is directly related to the data challenge of transparency and accessibility. Firms must be confident that they even have the necessary data, and that they can access the right data to meet various mandates and respond to audit requests. Regulation Best Interest (Reg BI) is underscoring the urgent need for firms to be able to access aggregate views of normalized data to identify trends and high-risk behavior, make recommendations to customers, and measure the effectiveness of their compliance programs.

3. Advisor Efficiency & Supervision

Firms must be able to manage their agents, advisors and support staff from the prospective advisor stage all the way through to onboarding and beyond. Advisors working remotely should be able to add or update state licenses and registrations, insurance licenses, carrier appointments and recurring fees, as well as track their continuing education along with initial, annual and ongoing questionnaires and attestations.

4. Client Lifecycle Management

Firms must also be able to manage client relationships from the moment they become a prospect, to each and every client meeting, related task, activity and event. Paperless onboarding and workflows complete with new account forms, client agreements, transactions, processing fees and commissions is a must in remote work environments. Aggregated and normalized data drives the process of managing the life of the client relationship from tracking appointments and delivery of Form CRS, to 17a3 Notices and 36-Month Letters, as well as suitability documentation during transaction reviews to comply with Reg BI.

5. Smart Data Insights

Having the right data not only drives greater efficiency across remote workforces and multiple workflows, it can also make firms smarter. Discovering and viewing the details of high-risk trends and behaviors within a firm – before they become bigger and more costly problems – are crucial for controlling risk. With aggregated data, firms can analyze, detect and present key business activity trends, enabling trade surveillance and supervision. 

Data that Drives Efficiency

Home office staff and remote advisors of broker-dealer and RIA firms must be able to access data when they need it for a wide variety of purposes. Cloud-based systems that provide aggregated and normalized data in one place, while adjusting quickly to evolving regulations and keeping advisors connected, are becoming more crucial to firms’ ability to control the risk and cost of non-compliance as well as advisor and client attrition.