For many financial advisors, the idea of adopting new technology can feel daunting. Past experiences with complex or costly systems may have left you cautious about investing in additional tools. However, as the advice industry continues to evolve, delaying digital transformation is becoming increasingly difficult to justify.
Advisory firms that integrate the right technology into their operations are not only improving efficiency, they’re achieving stronger financial performance. Based on a 2024 report from Adviser Ratings, firms that proactively adopt digital solutions are reporting average profit margins above 20%, with the top-performing practices reaching 40%. In contrast, firms that remain hesitant to adopt technology are seeing lower average margins around 18%.
This growing gap highlights an important reality: the cost of maintaining outdated systems now outweighs the perceived risk of change.
Manual workflows limit growth
As a financial advisor, you’re likely familiar with the pressure to do more with less — whether that means managing more clients, meeting regulatory demands or providing more tailored services. Under these conditions, relying too heavily on manual processes can hinder long-term growth and operational efficiency.
Basic tasks such as performance tracking, dividend recording, or tax reporting still consume a disproportionate amount of time in some practices. This reduces the time available for higher-value activities such as client relationship management and strategic planning.
Adviser Ratings’ report found that 64% of advisory practices have already implemented digital applications to streamline workflows and reduce costs. These firms are using technology to drive efficiency, maintain compliance and improve the quality of service delivery. In this competitive and rapidly evolving landscape, standing still means you risk being left behind.
Profitability and competitive advantage
The link between tech adoption and business performance is becoming clearer. According to Adviser Ratings, firms that make targeted investments in their tech stack are achieving profit margins that are 50% higher than those of their less digitally mature peers. While profitability is influenced by many factors, operational efficiency plays a key role.
Technology helps reduce duplication, minimise errors, and provide faster access to reliable data — all of which directly translate into a more successful business.
Advisors also benefit from better business visibility. Automated systems offer clearer insights into client portfolio performance, enabling more proactive and personalised advice. This not only supports client outcomes but also contributes to long-term client retention.
Preparing for the next wave of innovation
The conversation is now shifting beyond basic automation to include technologies like artificial Intelligence (AI). Nearly half of advice firms report interest in AI, and research from Netwealth shows that 65% are planning to increase their AI investment over the next year. For many firms, this may involve automating more complex workflows or using AI-powered insights to enhance advice delivery.
While AI adoption is still in its early stages, firms that are laying the groundwork now are better positioned to respond to future client and regulatory expectations. If one thing is clear, it’s that tech adoption is no longer optional — it’s central to how firms operate, grow and deliver value for their clients.
Simplifying adoption with flexible tools
Digital transformation does not have to involve large, costly platforms. For many firms, the most effective approach is to integrate lightweight, purpose-built tools into their tech stack that solve specific challenges.
Portfolio tracking software is a good example of a lightweight tool that can make a meaningful impact in how you run your business without requiring a major investment. The right portfolio tracking tool will automate performance tracking, dividend reporting, capital gains calculations and more. The ability to import detailed portfolio data in just a few clicks, and even integrate with systems like Xero, can make a huge difference in the time you spend on admin.
A solution with reporting tools for tax planning, asset allocation, diversification, risk and performance evaluation will also elevate the client experience and help shift conversations from portfolio composition updates to strategic investing decisions.
While it’s not uncommon for advisory firms to adopt a WRAP platform, not only are these platforms typically expensive, but they rarely fit within existing workflows. If you’re looking to improve your firm’s reporting capabilities without undertaking a full platform overhaul, using a dedicated portfolio tracking solution can be a practical and scalable option.
A practical path forward
Advisory practices are increasingly expected to deliver a high standard of service while managing cost pressures and regulatory complexity. Amid these challenges, adopting the right technology is not about following trends, it’s about future-proofing your business to meet the needs of both current and future clients, and ensuring you can continue to thrive in today’s rapidly evolving advice landscape.
Whether the goal is to improve reporting, streamline compliance or better support client engagement, it’s clear that firms that invest in digital capability are seeing tangible business benefits. If you feel that your tech strategy is lacking, the good news is that you don’t need to overhaul your entire business. By taking a considered, incremental approach to tech adoption, you can enhance your service model, improve profitability and build resilience in a changing market.
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