We now move to our 4th blog in our series on our #RegTech platform Model Office – MO and the 5 keys our research has found are crucial in building a compliant, client-centric and sustainable professional practice. Click here sign up for our weekly blogs.
We now focus on ‘the engine room’ of your business being the business and client operational practice management strategies along with administration, tasks and quality of data and how it flows through the business.
As ever MO's keys are structured into business functions, and Your Systems has 11, which your firm’s back office, middle and front office effectiveness are measured against the FCA rules, MiFIDII, SMCR, GDPR and your peers activities:
Accounting software: This focuses on how your software is used to record and track income and expenses, inventory, invoicing and cash flow plus ensuring all financial data is accurate and kept up to date, your financial information is monitored and tracked in real time
Customer Relationship Management (CRM) system: With service suitability and product appropriateness in mind a dedicated client relationship management software should drive business efficiencies, opportunity tracking, relationship evolution and tracks client contact in real time. Data should be kept accurate, campaigns, service levels, fees & charges, MI, client reporting and bulk uploads also need to be tracked effectively and provide quality data on specific client needs
Policies and procedures (P&P) and Systems and controls: Well documented policies and procedures regarding the advice and implementation process and review meetings that ensure advice process(es) (i.e. face-to-face and/or auto advice) are streamlined across the practice, that evidence for client informed consent is obtained for each piece of advice and risk assessment meets MiFIDII’s due diligence requirements. An office manual outlining other important office policies that effectively drive business efficiencies and ensure the office runs smoothly needs to be accessible and understood by key staff
Workflow management system: MO tests for a highly developed, automated and efficient process for managing specific workflows across the business services including number of prospect and client meetings
Client portal and Information access: New technology now offers online secure messaging system that allows client 24/7 access to their information, secure document storage, minimises paperwork. This can heighten client engagement whilst also ensure your firm records client communications in a uniform manner across the business as per MiFIDII.
Activity management: MO focuses on 2 areas:
- Controls: With APER and SMCR in mind, there is a necessity to ensure all team activity is logged through diary management, enhance staff organisation, efficient delegation and non-duplication of administration tasks
- Straight through processing: Your system encourages quality fund data flow and capture across the product and platform/Centralised investment proposition(s)
Document management system: This needs to be centralised and accessible, with controls placed around all documents, illustrations/quotations and valuations and currently based in the European Union
Compliance: Systems and processes need to ensure 100% compliance with all regulatory directives. Internal and external audits are conducted and recorded frequently and thoroughly which MO’s system provides
Complaints handling: A Clear, documented and effective process for managing complaints that all staff are aware of and offers accessibility for all relevant stakeholders
Outsourcing: MO focuses on 2 key areas:
- Key business functions: Such as Para planning; professional fund management requires effective and efficient management and provides seamless experience for clients and delivers business efficiencies and financial benefits to the business
- Costs: Are monitored and scrutinised regularly along with the business plan
Data flows, quality and security: Client data feeds flow efficiently across systems, processes and technology to ensure confidential and sensitive information is kept secure. Data is stress tested and protected with back-up and security. An Application Programming Interface (API) is available to asses quality client data and MI.
The General Data Protection Regulation: MO tests your current practice against 7 key areas that The GDPR requires all firms holding customer data to comply with. These can be found at our GDPR blog
Next week we cover our 5th and final key Your People.
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