A vast majority of investment professionals expect their firms’ budgets to be allocated to technology that will help them comply with the new DOL Fiduciary Rule, according to a survey by SS&C Technologies Holdings.
Eighty five percent of the respondents in the survey believed that more of their firms’ budgets will be used for adopting technology that will help them meet standards of the DOL Fiduciary Rule, while 33% expected their firms to allocate 10-25% of their budgets for the same cause.
On being asked about the technologies that would help firms comply with the DOL rule, 18% cited client portal/document management capabilities, 14% said billing – fee scheduling and disclaimer support, 14% said portfolio management and reporting, and 13% cited financial planning.
When asked about business growth challenges, 28% of investment professionals cited that "operational efficiency isn’t where it needs to be to reach our business goals." This was followed by those who said that the challenge was whether or not their current service model is still a fit for today’s more demanding clients (22%), attracting the right advisor talent to meet growth goals (19%), the DOL rule and regulations are hurting their business (17%), and how to operate a robo-platform within their business (12%).
Moreover, 80% of respondents believed that the DOL rule will specifically affect impact policies, procedures and technology systems at their firms, and 41% expect "substantial changes" regarding the impact on their firms.
Further, 62% of respondents believed that complying with the DOL rule would affect the makeup of their client base.
SS&C Advent managing director and co-general manager Dave Welling said: "While the industry is still digesting exactly how to adapt their businesses due to the DOL rule, it’s undeniable that firms will need to evolve their advice models and their daily operations.
"We are actively engaged with our clients on the challenges and opportunities ahead and how investment in technology can help them grow, scale and run their businesses more efficiently."