Technology is ubiquitous. We hear about it transforming the way we shop, how we plan, how we spend our downtime. It’s transforming every conceivable industry, including the 401k, finance and retirement industries.
We know we should be ready, and that technology-driven change is inevitable. There are so many ways to incorporate technology into your 401k business, but trying to choose the right technology can be as daunting as choosing the right paint for your home. What are the right solutions?
To answer, we must first frame our decision process differently.
Rather than invest in a technology you hope will solve your problems, bottlenecks and pain points, ask this question: What is technology doing for you, your firm and your clients?
While a Band-Aid solution for all your business needs is not necessarily impossible, building technology to solve for all aspects of your business is costly and extremely time-consuming; so time-consuming, in fact, that if you build it for today, it’s probably antiquated by tomorrow.
That said, it’s best to begin by looking at you, your client and your firm separately, and define what each need. Technology should engage your client, streamline your firm, and produce greater efficiencies for you. Is your technology addressing them all? If not, why not?
Think about the money you’re currently investing in tech. How do you allocate your investments, and are you obtaining the outcome for which you are spending? Try not to overcomplicate—identify the goals technology will help you achieve for you, your clients and your firm.
The age-old debate continues—build or buy—but it’s changing. The trend now is a build it and buy it model; a hybrid of sorts. Based on the technology goals identified by entity begin by evaluating the offerings of niche technology firms. They tend to focus on doing/performing/creating a few things exceptionally well. Engaging a niche firm in order to execute in an area in which they do exceptionally well allows you to execute in areas where you do exceptionally well.
The next time you wonder about technology, and what it’s done for you lately, the answer should be that it’s helped you, your clients and your firm.
Christen Deeb is an independent contributor to 401(K) Specialist. She has spent the nearly a decade in financial services, but all her career has been in and around technology. Her articles are not meant to offer solutions, specifically, but engage 401k advisors in technology discussions across the industry.