Document Management with Workflow Helps IFP Improve Efficiency as Firm Expands

Transcription

1 Reprint from June 2012 Document Management with Workflow Helps IFP Improve Efficiency as Firm Expands By Jennifer Tanck, Esq. Several years ago, our company, Independent Financial Partners (IFP), embarked on a new growth strategy that demanded improved efficiency and the ability to scale as new independent advisors joined the firm. As one of LPL Financial s largest producer groups, IFP supervises the compliance and operations of over 400 advisors throughout the country and is continuing to grow at a record rate. Our industry is very paper intensive and part of our growth strategy was to identify a way to handle the mountains of paperwork required by compliance. Due to financial industry regulations, we are required to keep a duplicate client file for every advisor that we supervise. As our financial advisor community grew, it became apparent that we had several major issues to address. 1. The volume of paperwork that would be accumulated as a result of these requirements could no longer be housed using a traditional paper filing system. 2. The client files we maintained were not consistent with client files in the offices of our remote advisors. 3. Our main office is located in a waterfront location in Florida, which we were always concerned about the potential threat of a natural disaster. 4. We needed to make sure we kept accurate archives for compliance purposes. IFP needed a system that would allow the firm to share documents, help meet obligations to safeguard files and ensure limited business interruption in the event of a catastrophic natural disaster. We knew that transitioning to an electronic filing system was the ideal solution. Volume X, Issue 6, June 2012 Our primary goals in selecting a document management system were to address the issues previously mentioned as we felt they were the most important to the growth, sustainability and strong compliance-oriented (C) Copyright Virtual Office News LLC All Rights Reserved

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3 culture of our business. Secondarily, we identified a long-term goal to make our business more efficient by introducing technology into certain workflow processes within our business, such as client new account review, approval and distribution. After researching several document management systems, we came across CNG-SAFE from Cabinet NG (CNG). After reviewing the platform and comparing options, we concluded that their system had the flexibility to fit our growing business, and CNG was committed to being a long-term technology partner with IFP. We also thought the solution had the best chance of being approved by our broker/dealer as an independent document management solution under the SEC Rule 17a-4 electronic storage requirements. With everything electronic via CNG-SAFE, we noticed an improvement in workflow with advisors submitting paperwork through the system for approval. Documents are first reviewed by one of our Compliance Analysts for completeness and accuracy. Once approved, CNG s workflow forwards the documents to the appropriate Registered Principal for suitability review and final approval. Using this method versus a pure paper method decreases the amount of time an account is open for review, which means business is ultimately processed faster. It is also much easier to gauge where we are in terms of turnaround times and outstanding items for review. CNG-SAFE assists us in knowing when workloads amongst our staff need to be redistributed. And, because each item within the system is already filed in its proper place, it greatly decreases the likelihood of paperwork getting lost or mishandled in some way. CNG-SAFE has been especially helpful during our annual branch exam, as well as the exams we perform on the (almost 300) offices that we supervise. For example, when LPL Financial comes to examine our office, they are provided with temporary logins to CNG-SAFE, allowing them to efficiently access the information they need from client files rather than requiring us to manually pull paper files as the requests come in. This makes for a more efficient examination from both sides of the audit. With respect to the audits we perform on the remote branch offices we supervise, CNG-SAFE allows us to complete a majority of the client file reviews from our home office location. On-site time is significantly reduced and focused on reviewing other important items. What Will You Require for Your Document Management Solution? Key to our strategy was selecting a partner that would work with us at the corporate level, but at the same time support our advisors in managing the flow of documents across the entire operation. Cabinet NG proved to be the best fit because of its strong product offerings and willingness to train and support the advisors. When searching for a solution, make sure to do your due diligence and identify the general requirements you want your solution to meet before reaching out to vendors. Below are some of the features we required in a document management solution. Ease of Use Simplicity is paramount; the solution must be user-friendly

4 with an intuitive interface, with the option for at least some customizations at either the advisor or supervisory level, or both. Look for a solution that mimics your physical environment so users will feel more at ease with a system that is similar to something they already know. As we ve gained experienced with the system, the ability to be able to make customizations to fit our business processes has been vital. Integration Look for a solution that integrates with your existing software, general business/office applications, billing system, etc. Linking systems together dramatically improves operational efficiencies and reduces data entry errors, otherwise you would need to budget for replacement software and retraining. For example, CNG-SAFE provides enhanced functionality with Microsoft Outlook, Intuit QuickBooks, Sage ACT!, Climark Advisor s Assistant and Laser App, among others. Workflow - An effective workflow system has the following characteristics: A central repository where documents are stored and indexed. A security system that allows only the appropriate personnel to view cabinets, folders and documents. A flexible workflow methodology with rules that mirror manual processes and can adjust the flow of information dynamically based on logical criteria. The ability for knowledge workers to have anywhere, anytime access to the documents they need to get the job done. Security & Compliance Controlling access and user rights on every single document is a must. Regulations are in place to ensure the privacy of customers and employees personal information. With a paper-based filing system, there is no efficient way of securing files beyond locking the cabinet. With a document management system it s easy to specify who has access and what they are allowed to do with a document, such as a view, edit and/or delete. In addition, document retention allows you to define how long a document must be kept in the system. Setting document retention ensures an employee will not inadvertently delete or alter a document for the designated period. Additionally, the system needs to strictly conform to SEC Rule 17a-4 electronic storage standards. Otherwise, advisors would be required to maintain companion paper files. Training The quality and availability of customer service and technical support during the first weeks and months of implementation is invaluable. Will your firm require in-house training? What happens when new employees are brought on or if someone needs a review of the system? Make sure you have the support in place for when you need it, because you will. ROI Demonstrating a financial return on the investment should be fairly easy to do since many firms spend tens of thousands of dollars annually on file folders, paper, offsite storage and file clerks. The system should make a meaningful impact on reducing cost and storage space in the office within a year. Labor savings, as a result of improved efficiencies, will be a major contributor to the total ROI. Because the financial services industry by its very nature is a paper-driven

5 business, it is important from a regulatory standpoint to maintain accurate books and records, and safeguard this information accordingly. CNG- SAFE helps us meet these objectives in a user-friendly and cost-efficient manner. While the overall savings we have achieved as a result of implementing CNG-SAFE are difficult to measure, the most significant impact has been the capital and space saved due to the lack of physical filing cabinets we ve needed to maintain. If we had to maintain physical paper copies of our advisors client files, we estimate that we would need in excess of 400 standard filing cabinets which we do not have adequate space for in our facility. For recruits who are looking to go paperless as they transition to a new firm, it is an added benefit that we already have a turnkey system and process in place that they can plug into with little or no effort on their part. * * * * * Jennifer Tanck, Esq. is President of Independent Financial Partners in Tampa, FL. Since 2008, she has helped grow the firm s comprehensive network of advisors and wealth management services. Independent Financial Partners recently experienced a year of record growth in revenue, financial advisors joining the firm s network and client assets under advisement and continues to expand. The firm ended 2011 with over 400 advisors in their network, resulting in record revenue of $56.5 million.