Cut Red Tape: 50% Less Manual Data Entry Time
Executive Summary
Richardson & Associates, a growing RIA managing over $750 million in assets, struggled with the significant time burden of manual data entry during client onboarding. By implementing automated data entry processes utilizing Albridge Wealth Reporting and ABBYY FineReader OCR technology, Richardson & Associates reduced manual data entry time by 50%, freeing up valuable staff hours for client relationship management and strategic planning. This increased efficiency allowed the firm to onboard new clients more quickly and focus on delivering personalized financial advice.
The Challenge
For Richardson & Associates, rapid growth presented a significant operational challenge. With assets under management (AUM) increasing by 20% year-over-year, the firm was onboarding an average of 10-15 new clients each month. The manual data entry process associated with opening new accounts, transferring assets, and updating client information across various systems had become a major bottleneck.
Each new client required the firm to manually input data from various sources, including paper-based account applications, statements from multiple custodian platforms (such as Schwab, Fidelity, and Pershing), and legacy client records. This process involved painstakingly keying in information such as account numbers, asset allocations, beneficiary details, and tax identification numbers.
Specifically, before automation, the firm estimated that each new client onboarding process required approximately 8 hours of manual data entry across multiple staff members. With 10-15 new clients per month, this translated to 80-120 hours of staff time dedicated solely to data entry. Given an average hourly rate of $50 for operations staff, the firm was spending between $4,000 and $6,000 per month on manual data entry alone.
Beyond the direct labor costs, the manual process also introduced several other problems:
- Increased Error Rate: Manual data entry is prone to human error, leading to inaccuracies in client records and potential compliance issues. The firm estimated that approximately 5% of manually entered data contained errors, requiring additional time for verification and correction.
- Delayed Onboarding: The time-consuming data entry process delayed the onboarding of new clients, creating a negative first impression and potentially impacting client satisfaction. The average onboarding time was 10 business days.
- Reduced Advisor Productivity: Advisors were spending less time focusing on client relationship management and financial planning due to the administrative burden of data entry. They spent, on average, 2 hours per new client addressing data entry errors and issues.
- Scalability Concerns: As the firm continued to grow, the manual data entry process would become even more unsustainable, hindering its ability to efficiently onboard new clients and scale its operations. They were projecting an additional 25% increase in AUM the following year.
- Compliance Risks: Manual processes increased the potential for compliance breaches, such as failing to properly document client information or adhere to regulatory requirements.
The Approach
To address these challenges, Richardson & Associates recognized the need to automate its data entry processes. The firm's leadership team, spearheaded by the Chief Operating Officer (COO), established the following strategic objectives:
- Reduce Manual Data Entry Time: The primary goal was to significantly reduce the time spent on manual data entry, freeing up staff hours for higher-value activities. The target was a 50% reduction within six months.
- Improve Data Accuracy: Automation was expected to improve data accuracy by eliminating human error and ensuring consistency across all systems.
- Streamline Onboarding Process: The firm aimed to shorten the onboarding process and improve the overall client experience. The goal was to reduce onboarding time to 5 business days.
- Enhance Advisor Productivity: By reducing the administrative burden, the firm sought to empower advisors to focus on client relationship management, financial planning, and business development.
- Ensure Regulatory Compliance: Automation was seen as a way to strengthen compliance efforts by providing a more auditable and transparent data management process.
The decision-making framework involved a thorough evaluation of various automation solutions, considering factors such as cost, integration capabilities, security, and ease of use. The firm consulted with technology experts and other RIAs who had successfully implemented similar automation projects.
Ultimately, Richardson & Associates decided to implement a solution that involved integrating its CRM system with custodian platforms using Albridge Wealth Reporting and leveraging ABBYY FineReader OCR technology for automated data extraction from documents.
The COO championed the initiative, fostering collaboration between the operations team, IT department, and external technology consultants. The team developed a detailed project plan, outlining specific tasks, timelines, and responsibilities. They also established key performance indicators (KPIs) to track the progress and success of the automation project.
Technical Implementation
The technical implementation involved the following key steps:
- Data Aggregation with Albridge Wealth Reporting: Albridge Wealth Reporting was implemented to aggregate client account data from various custodian platforms, including Schwab, Fidelity, and Pershing. Albridge provided a secure and centralized platform for accessing and managing client data from multiple sources. The integration with the CRM system (using secure APIs) enabled automated updates of client account information, eliminating the need for manual data entry.
- OCR Implementation with ABBYY FineReader: ABBYY FineReader was deployed to automate the extraction of data from paper-based documents, such as account applications, statements, and legacy client records. The OCR software automatically converted scanned documents into searchable and editable text, enabling automated data extraction.
- Automated Data Extraction: Custom workflows were created within ABBYY FineReader to automatically extract specific data fields from different types of documents. These workflows were designed to recognize and extract information such as account numbers, asset allocations, beneficiary details, and tax identification numbers. The extracted data was then automatically populated into the CRM system.
- Data Validation and Verification: To ensure data accuracy, automated validation rules were implemented within the CRM system to flag any discrepancies or potential errors. The system also included a manual verification step, where operations staff reviewed the extracted data to confirm its accuracy.
- Integration with Compliance System: The automated data entry process was integrated with the firm's compliance system to ensure that all client information was properly documented and maintained in accordance with regulatory requirements.
- Calculations for Time Savings:
- Time Saved per Client: Before automation, 8 hours of manual data entry per client. After automation, 4 hours (50% reduction).
- Clients Onboarded per Month: 10-15 clients.
- Total Hours Saved per Month: (8 hours - 4 hours) * 10 clients = 40 hours minimum. (8 hours - 4 hours) * 15 clients = 60 hours maximum.
- Annual Cost Savings: 40 hours/month * $50/hour * 12 months = $24,000 minimum. 60 hours/month * $50/hour * 12 months = $36,000 maximum.
Results & ROI
The implementation of automated data entry processes yielded significant results for Richardson & Associates:
- Reduced Manual Data Entry Time: Manual data entry time was reduced by 50%, from 8 hours per client to 4 hours per client. This exceeded the firm's initial target.
- Improved Data Accuracy: The error rate associated with data entry decreased from 5% to less than 1%.
- Streamlined Onboarding Process: The average onboarding time was reduced from 10 business days to 6 business days, improving the client experience.
- Enhanced Advisor Productivity: Advisors were able to dedicate more time to client relationship management and financial planning, resulting in improved client satisfaction and increased revenue generation. Client satisfaction scores improved by 15%.
- Increased Operational Efficiency: The automation of data entry processes significantly improved operational efficiency, enabling the firm to onboard new clients more quickly and scale its operations.
- Cost Savings: The reduction in manual data entry time resulted in significant cost savings, estimated at $24,000 to $36,000 per year, based on $50/hour for operations staff.
- Scalability: The automation positioned Richardson & Associates for continued growth, enabling them to efficiently handle an increasing volume of new clients without adding significant headcount. They saw a 30% increase in AUM the following year.
Specific Metrics:
| Metric | Before Automation | After Automation | Change |
|---|---|---|---|
| Data Entry Time/Client | 8 hours | 4 hours | -50% |
| Data Entry Error Rate | 5% | <1% | -80% |
| Onboarding Time | 10 Days | 6 Days | -40% |
| Operations Staff Hours | 80-120/Month | 40-60/Month | -50% |
| Estimated Annual Savings | N/A | $24,000-$36,000 | N/A |
| Client Satisfaction | N/A | +15% | +15% |
Key Takeaways
For other RIAs considering automating their data entry processes, Richardson & Associates offers the following key takeaways:
- Conduct a Thorough Assessment: Before implementing any automation solution, carefully assess your current data entry processes and identify specific pain points. Quantify the time and cost associated with manual data entry to build a strong business case for automation.
- Choose the Right Technology: Select automation tools that are compatible with your existing systems and meet your specific needs. Consider factors such as integration capabilities, security, and ease of use. Don't be afraid to consult with technology experts to find the best solution for your firm.
- Develop a Detailed Project Plan: Create a comprehensive project plan that outlines specific tasks, timelines, and responsibilities. Clearly define the goals and objectives of the automation project and establish KPIs to track progress and success.
- Prioritize Data Accuracy: Implement data validation rules and manual verification steps to ensure the accuracy of the extracted data. Data quality is essential for maintaining client trust and ensuring regulatory compliance.
- Focus on Change Management: Communicate the benefits of automation to your staff and provide them with adequate training on the new systems. Address any concerns or resistance to change to ensure a smooth transition.
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