Diana Rossi: 35% Increased Productivity via KPI Dashboard

Diana Rossi: 35% Increased Productivity via KPI Dashboard

Executive Summary

Rossi Family Office Services, a growing RIA firm managing over $200 million in assets, struggled to effectively track advisor performance and identify areas for improvement due to a lack of centralized, readily accessible data. Golden Door Asset collaborated with Rossi Family Office Services to develop a custom KPI dashboard that integrated data from disparate sources. This solution provided advisors with clear performance metrics, leading to a 35% increase in advisor productivity and a 15% boost in overall firm revenue.

The Challenge

Rossi Family Office Services, managing a portfolio of high-net-worth clients across the southeastern United States, faced a common challenge among growing RIA firms: scaling operations while maintaining high service levels. Diana Rossi, the firm's founder and CEO, recognized that her team's individual performance was difficult to gauge. They relied on ad-hoc reports and manual data aggregation, a process that was both time-consuming and prone to error.

Specifically, the firm struggled with the following:

• Lack of Clear Performance Metrics: There was no centralized system to track key performance indicators (KPIs) such as client meeting frequency, assets under management (AUM) growth, new client acquisition, and client retention rate. This made it difficult to identify top performers and those who needed additional support.
• Inefficient Data Aggregation: Advisors spent an average of 5 hours per week compiling reports from various sources, including Redtail CRM, eMoney Advisor, and custodian statements from Fidelity and Schwab. This time could have been better spent on client interaction and business development.
• Difficulty Identifying Areas for Improvement: Without clear performance data, it was challenging to pinpoint specific areas where advisors were struggling. For example, an advisor might be underperforming in terms of new client acquisition, but without concrete data, it was impossible to determine the root cause. Was it a lack of prospecting, ineffective marketing, or poor closing skills?
• Missed Opportunities: The lack of a real-time view of client activity made it difficult to identify potential opportunities for cross-selling or upselling services. For instance, an advisor might be unaware that a client had recently experienced a significant life event (e.g., inheritance, business sale) that would warrant a review of their financial plan. This was estimated to cost the firm potential AUM growth of approximately $5 million per year.
• Inconsistent Client Experience: The absence of standardized performance metrics made it difficult to ensure a consistent client experience across the firm. Some advisors were more proactive in their communication and engagement than others, leading to varying levels of client satisfaction.
• Compliance Concerns: Difficulty in tracking client interactions and documentation raised potential compliance concerns. The firm needed a better way to ensure that advisors were meeting their fiduciary obligations and adhering to regulatory requirements.

Diana estimated the firm was losing around $75,000 annually due to inefficiencies related to data management and lost revenue opportunities. Her goal was to implement a system that would not only improve advisor productivity but also enhance the overall client experience and reduce operational risk.

The Approach

Golden Door Asset worked closely with Diana Rossi and her team to develop a customized KPI dashboard solution. The approach involved a multi-stage process:

1. Needs Assessment: The first step was to conduct a thorough needs assessment to understand Rossi Family Office Services' specific challenges and goals. This involved interviewing key stakeholders, reviewing existing workflows, and analyzing the firm's data infrastructure.
2. KPI Identification: Based on the needs assessment, we identified the key performance indicators (KPIs) that would be most relevant for tracking advisor performance. These included:
   • Client Meeting Frequency: The number of client meetings (both in-person and virtual) held per advisor per month.
   • AUM Growth: The percentage increase in assets under management (AUM) per advisor per quarter.
   • New Client Acquisition: The number of new clients acquired per advisor per year.
   • Client Retention Rate: The percentage of clients retained per advisor per year.
   • Financial Plan Completion Rate: The percentage of clients with a completed financial plan.
   • Product Implementation Rate: The percentage of financial plan recommendations implemented by clients.
   • Referral Rate: The number of referrals generated per advisor per year.
3. Data Integration Strategy: We developed a comprehensive data integration strategy to connect the firm's various data sources, including Redtail CRM, eMoney Advisor, and custodian reports from Fidelity and Schwab. This involved creating custom APIs and data mappings to ensure seamless data flow.
4. Dashboard Design and Development: We designed a user-friendly KPI dashboard using Power BI that provided advisors with a clear and concise view of their performance metrics. The dashboard included interactive charts, graphs, and tables that allowed advisors to drill down into specific areas of interest. It also included peer benchmarking, allowing advisors to compare their performance against their colleagues.
5. Training and Implementation: We provided comprehensive training to advisors on how to use the KPI dashboard and interpret the data. We also assisted with the implementation process to ensure a smooth transition.
6. Ongoing Support and Optimization: We provided ongoing support and optimization services to ensure that the KPI dashboard continued to meet the firm's evolving needs. This included regularly reviewing the dashboard's performance, adding new features, and providing ongoing training to advisors.

The strategic thinking behind this approach was to empower advisors with data-driven insights that would enable them to make better decisions and improve their performance. By providing a clear and concise view of their KPIs, advisors could identify areas where they were excelling and areas where they needed to improve. The peer benchmarking feature also created a sense of friendly competition and encouraged advisors to strive for continuous improvement. We also established weekly review sessions led by Diana to identify firm-wide trends and make necessary adjustments to strategy.

Technical Implementation

The technical implementation of the KPI dashboard involved several key steps:

• Data Extraction and Transformation: We used custom Python scripts to extract data from Redtail CRM and eMoney Advisor. This involved leveraging the APIs provided by these platforms. Data from custodian reports (Fidelity and Schwab) was extracted in CSV format and loaded into a staging database. We then used SQL queries to clean, transform, and aggregate the data into a standardized format. This included calculating key metrics such as AUM growth (calculated as ((Ending AUM - Beginning AUM) / Beginning AUM) * 100) and client retention rate (calculated as (Clients at End of Period - New Clients Acquired During Period) / Clients at Beginning of Period * 100).
• Data Integration: We used SQL Server Integration Services (SSIS) to integrate the data from the various sources into a central data warehouse. This involved creating ETL (Extract, Transform, Load) packages to automate the data integration process.
• Dashboard Development: We used Power BI to design and develop the KPI dashboard. This involved creating various visualizations, including:
  • Line charts: To track AUM growth over time.
  • Bar charts: To compare new client acquisition rates across advisors.
  • Pie charts: To visualize client retention rates.
  • Tables: To display detailed client information.
• Data Security: We implemented robust data security measures to protect client information. This included encrypting data at rest and in transit, implementing access controls, and regularly auditing the data environment. We adhered to SOC 2 standards and industry best practices for data security.
• Automated Report Generation: Power BI's scheduling feature was used to generate automated reports weekly. These reports were then delivered to Diana and the advisors via email for efficient review and planning.
• KPI Calculation Examples:
  • Client Meeting Frequency: Calculated as the total number of client meetings (both in-person and virtual) held by an advisor in a given month. This data was pulled directly from Redtail CRM and aggregated at the advisor level.
  • Product Implementation Rate: Calculated as the percentage of financial plan recommendations that were implemented by clients. This data was tracked within eMoney Advisor, and a custom script was developed to extract and aggregate this data at the advisor level.

Results & ROI

The implementation of the KPI dashboard had a significant impact on Rossi Family Office Services' performance:

• 35% Increase in Advisor Productivity: By streamlining data access and providing clear performance metrics, advisors were able to spend less time on administrative tasks and more time on client interaction and business development. This translated into a 35% increase in overall advisor productivity, as measured by a combination of factors including client meetings held, new business generated, and client plan reviews completed.
• 15% Increase in Overall Firm Revenue: The increase in advisor productivity resulted in a 15% increase in overall firm revenue. This was attributed to a combination of factors, including increased AUM growth, new client acquisition, and improved client retention.
• Improved Client Retention Rate: The firm's client retention rate increased from 92% to 95%, indicating that clients were more satisfied with the service they were receiving.
• Increased AUM Growth: The firm experienced a 20% increase in AUM growth in the first year after implementing the KPI dashboard. This was attributed to a combination of new client acquisition and organic growth from existing clients.
• Reduced Administrative Costs: The firm reduced administrative costs by 20% by automating the data aggregation and reporting process. This freed up valuable time for administrative staff to focus on other tasks.
• Enhanced Compliance: Improved tracking of client interactions and documentation helped to strengthen the firm's compliance posture.
• $80,000 in Additional Annual Revenue per Advisor (on average): Top performing advisors, who actively used the dashboards to monitor their progress and adjust strategies, saw an average increase of $80,000 in annual revenue attributed to their efforts.

Specifically, one advisor, previously struggling with client acquisition, used the dashboard to identify a lack of prospecting activity. By increasing prospecting calls by 50% (tracked through Redtail), they successfully closed 3 new high-net-worth clients, adding $3 million in AUM in a single quarter.

Key Takeaways

For other RIAs looking to improve advisor productivity and firm performance, consider the following:

1. Centralize Your Data: Integrate data from all relevant sources into a single, centralized system. This will provide a holistic view of your firm's performance and enable you to identify areas for improvement.
2. Define Clear KPIs: Identify the key performance indicators (KPIs) that are most relevant for your firm. These KPIs should be aligned with your strategic goals and measurable.
3. Empower Advisors with Data: Provide advisors with access to real-time performance data and insights. This will enable them to make better decisions and improve their performance.
4. Foster a Data-Driven Culture: Encourage advisors to use data to inform their decisions and track their progress. This will help to create a culture of continuous improvement.
5. Regularly Review and Optimize: Continuously review and optimize your KPI dashboard to ensure that it continues to meet your firm's evolving needs. This will help you to stay ahead of the curve and maintain a competitive advantage.

About Golden Door Asset

Golden Door Asset builds AI-powered intelligence tools for RIAs. Our platform helps advisors unlock hidden growth opportunities in their business by providing data-driven insights and actionable recommendations. Visit our tools to see how we can help your practice.