40% Faster Onboarding with Digital Workflow Automation

40% Faster Onboarding with Digital Workflow Automation

Executive Summary

Registered Investment Advisors (RIAs) often grapple with inefficient, manual client onboarding processes that drain valuable time and create friction in the initial client experience. Pacific Gate Capital partnered with a leading advisory firm to address these challenges by designing and implementing a fully digital onboarding workflow. The new, automated system streamlined data collection, document processing, and compliance checks, resulting in a 40% reduction in onboarding time and a 25% improvement in client satisfaction scores.

The Challenge

For years, Pinnacle Wealth Management, a growing RIA managing over $750 million in assets, struggled with a cumbersome and inefficient client onboarding process. Their process, heavily reliant on paper forms, manual data entry, and back-and-forth email communication, was not only time-consuming but also prone to errors.

Here's a breakdown of the key pain points:

• Time-Intensive Manual Processes: Each new client required an average of 12 hours of staff time to onboard, from the initial data gathering to compliance verification. This included printing and mailing multi-page account opening documents, manually entering data into the CRM (Redtail), and chasing down missing information from clients. This 12-hour average translated to a significant operational cost, estimated at $1,200 per client based on staff hourly rates, negatively impacting profitability.

• Increased Risk of Errors: Manual data entry inevitably led to errors, resulting in inaccurate client profiles and potential compliance violations. A single error in asset allocation during the onboarding phase, for example, could expose the firm to significant financial risk and reputational damage. Pinnacle estimated that approximately 5% of new client profiles contained errors requiring correction.

• Poor Client Experience: The lengthy and disjointed onboarding process created a negative first impression for new clients. Clients often expressed frustration with the repetitive requests for information and the lack of transparency in the process. A client survey revealed that 30% of new clients felt the onboarding experience was "difficult" or "very difficult." The firm recognized that this poor experience could lead to client attrition in the long run.

• Compliance Burden: Ensuring compliance with regulatory requirements, such as KYC (Know Your Customer) and AML (Anti-Money Laundering) regulations, was a significant challenge. The manual process made it difficult to track and document compliance checks, increasing the risk of regulatory penalties. With increased regulatory scrutiny and the potential for fines upwards of $50,000 per violation, the need for a more robust and auditable process was critical.

• Limited Advisor Capacity: The time advisors spent managing the onboarding process detracted from their ability to focus on strategic client relationship management and business development. Advisors were spending approximately 20% of their time on administrative tasks related to onboarding, limiting their capacity to acquire new clients and grow their book of business. This directly impacted revenue growth, with a potential loss of $100,000 in new client acquisition revenue per advisor annually.

The Approach

Pacific Gate Capital took a strategic, phased approach to address Pinnacle Wealth Management's onboarding challenges. The strategy focused on automating manual tasks, streamlining data flow, and improving the overall client experience.

1. Process Mapping and Analysis: We began by conducting a thorough analysis of Pinnacle's existing onboarding process, identifying bottlenecks and areas for improvement. This involved shadowing advisors and administrative staff, reviewing existing workflows, and analyzing data on onboarding cycle times and error rates.

2. Digital Workflow Design: Based on the process analysis, we designed a fully digital onboarding workflow that automated key tasks, including data collection, document processing, and compliance checks. The new workflow was designed to be intuitive and user-friendly for both clients and staff.

3. Technology Integration: We selected and integrated best-in-class technology solutions to support the digital workflow. This included a digital signature platform (DocuSign), a CRM (Redtail), and a risk profiling tool (Riskalyze). The integration ensured seamless data flow between these systems, eliminating the need for manual data entry.

4. Compliance Integration: Pacific Gate Capital ensured that the new digital onboarding process was fully compliant with all applicable regulations, including KYC and AML regulations. A key compliance element was automated identity verification checks against global watchlists and sanctions databases, further reducing risk and streamlining regulatory obligations.

5. Training and Support: We provided comprehensive training and support to Pinnacle's staff on the new digital onboarding process. This included hands-on training sessions, user manuals, and ongoing technical support. We also offered train-the-trainer sessions to enable Pinnacle's internal team to support the system long-term.

6. Iterative Improvement: Pacific Gate Capital monitored the performance of the new digital onboarding process and made ongoing improvements based on client feedback and data analysis. We tracked key metrics such as onboarding cycle times, error rates, and client satisfaction scores to identify areas for further optimization.

Technical Implementation

The technical implementation involved a strategic integration of several key platforms:

• DocuSign Integration: DocuSign was integrated into the onboarding workflow to enable clients to electronically sign account opening documents and other important forms. This eliminated the need for printing, mailing, and scanning paper documents, significantly reducing processing time. The integration was configured to automatically store signed documents in Redtail.

• Redtail CRM Integration: Redtail CRM served as the central repository for all client data. The digital onboarding workflow was integrated with Redtail to automatically create new client profiles and populate them with data collected through the online onboarding form. This eliminated the need for manual data entry and ensured data consistency across systems. Data fields were mapped to ensure accurate information transfer, including client name, address, date of birth, social security number, and investment objectives.

• Riskalyze Integration: Riskalyze was integrated to automate the risk profiling process. Clients completed an online risk questionnaire through Riskalyze, and the results were automatically integrated into their Redtail profile. This allowed advisors to quickly assess clients' risk tolerance and recommend appropriate investment strategies. The integration also allowed for automatic updates to a client's portfolio based on their changing risk profile.

• API Integration: Pacific Gate Capital developed custom API integrations to ensure seamless data flow between all systems. This included integrating with Pinnacle's custodian bank to automate account opening and funding processes. The API integrations were designed to be secure and scalable to accommodate future growth.

• Workflow Automation: Using Redtail’s workflow engine, we automated a series of tasks, including sending welcome emails, scheduling initial consultations, and triggering compliance checks. These automations freed up staff time and ensured that all onboarding tasks were completed in a timely manner.

• Data Security: Data security was a top priority throughout the implementation process. All systems were configured to comply with industry best practices for data security and privacy, including encryption and access controls. We also conducted regular security audits to identify and address any potential vulnerabilities.

To ensure optimal data integrity, a two-factor authentication process was implemented for all users accessing sensitive client data. Furthermore, all data transmitted between systems was encrypted using AES-256 encryption.

Results & ROI

The implementation of the digital onboarding workflow yielded significant results for Pinnacle Wealth Management:

• 40% Reduction in Onboarding Time: The average onboarding time was reduced from 12 hours per client to 7.2 hours per client. This freed up significant staff time, allowing Pinnacle to onboard more clients with the same resources. The reduction directly translated to cost savings of $480 per client.

• 25% Improvement in Client Satisfaction: Client satisfaction scores increased by 25%, as measured by post-onboarding surveys. Clients reported a more positive and efficient onboarding experience, leading to increased loyalty and referrals. The Net Promoter Score (NPS) increased from 35 to 50 as a result of the improved process.

• 90% Reduction in Errors: The number of errors in new client profiles decreased by 90%, significantly reducing the risk of compliance violations and operational inefficiencies. This resulted in a savings of approximately $5,000 per year in error correction costs.

• Increased Advisor Capacity: Advisors were able to spend less time on administrative tasks and more time on strategic client relationship management and business development. This resulted in a 15% increase in new client acquisition, generating an estimated $75,000 in additional revenue per advisor annually.

• Improved Compliance: The digital onboarding process provided a clear and auditable trail of all compliance checks, reducing the risk of regulatory penalties. The enhanced documentation capabilities decreased the time required for internal compliance audits by approximately 30%.

• Return on Investment: The total cost of the digital onboarding project was $50,000. Based on the cost savings, increased revenue, and reduced risk of compliance violations, Pinnacle estimates that the project will generate a return on investment of 300% within the first three years.

Key Takeaways

1. Prioritize Automation: Identify manual, repetitive tasks in your onboarding process and automate them using technology. Automating data collection, document processing, and compliance checks can significantly reduce onboarding time and improve efficiency.

2. Integrate Your Systems: Integrate your CRM, risk profiling tool, and other key systems to streamline data flow and eliminate the need for manual data entry. This will improve data accuracy and reduce the risk of errors.

3. Focus on the Client Experience: Design your onboarding process with the client in mind. Make it easy for clients to provide the information you need and keep them informed throughout the process. A positive onboarding experience can lead to increased client loyalty and referrals.

4. Embrace Digital Signatures: Implement a digital signature platform to eliminate the need for printing, mailing, and scanning paper documents. This will significantly reduce processing time and improve the client experience.

5. Invest in Training and Support: Provide comprehensive training and support to your staff on the new digital onboarding process. This will ensure that they are able to use the system effectively and provide excellent service to your clients.

About Golden Door Asset

Golden Door Asset builds AI-powered intelligence tools for RIAs. Our platform helps advisors automate compliance tasks, enhance client communication, and gain deeper insights into their business. Visit our tools to see how we can help your practice.