3 Ways to Evaluate the True Value of Your Tech Stack
Firms are constantly evaluating their tech stacks and assessing where the greatest value lies – especially during times of uncertainty. Shedding unnecessary technology “fat” frees them to make reductions in order to pursue their longer-term digital strategy as well as enhance the firm’s balance sheet. There are three things firms should evaluate and require from their technology as they consider the value it brings to reach their growth goals:
- Innovation Sustainability – Each component of a firm’s tech stack must regularly evolve and expand their points of integration to sustain and grow with their capacity to innovate and integrate. This should include client portals, mobile users, advisor portals, CRM, etc. How regularly are their vendors enhancing and upgrading technology to fit the evolving needs of their clients? Lastly, if their firm developed an internal solution and is now bearing the cost of ownership, it might be time to consider the benefits of outsourcing technology to experts with larger innovation capacity and capabilities.
- Scalability – If you’re not growing, you’re dying. Typically, many view scalability as the ability for technology to fit the growth patterns and speed of a firm. However, scalability can have a more subtle context within a tech stack. It’s important to understand if technology is capable of deploying underlying features in multiple ways to fit a variety of use cases. Can the technology serve and deliver based on flexibility as well as agility? Some advisors need uniform and concise widgets to serve many clients, while others need a more sophisticated experience with custom capabilities.
- Adoptability – If your advisors don’t value or adopt the tools you’re giving them, you’ve just thrown money and hours down the drain. While some may love the pixels and functionality, they might resist upending their entire workflow to adopt a new system. Can the tools adapt and be deployed to fulfill the existing workflow and incrementally enhance it? If so, the chances of adoption are much higher.
When comparing technology’s price against the value that it brings to your firm, it’s imperative to consider where it falls in regard to innovation, scalability, and adoptability. Many firms have legacy systems that are low priority; however, it’s costing them resources to innovate around these systems. The firms have adoptability but lack scalability or sustainability, which solves temporary issues but keeps them hostage down the line.
“I think the most common question recently is, can you look at my tech stack and is it good enough? One, can I sustain, two, can I grow? And three, where am I at economically? There’s some cost to all of this technology and it’s fair to say in this economy, can I skimp on something? Can I downgrade in order to save some money but still have efficiency.”
Kristen Schmidt, Founder, RIA Oasis – Wealth Management Today Podcast: #ItzOnWealthTech – RIA Technology Hoarding and COVID-19