Wealth Professional spoke to Appway's John Gabrik about an eye-opening new industry report
This article was produced in partnership with Appway.
Wealth Professional spoke to Appway’s John Gabrik about an eye-opening new industry report.
Chances are – as a professional who works in the finance industry – you’re familiar with the acronym NIGO: Not in Good Order submissions, the errors or omissions in documents that can cause all sorts of setbacks during the client onboarding process.
But were you aware of exactly how big a problem NIGOs can be?
When software pioneers Appway commissioned research giants Forrester for a new study – the results of which can be found in their white paper ‘Client Onboarding for Financial Services’ – they were surprised at just how prevalent the issue turned out to be.
“While the acronym NIGO may be somewhat specific to broker-dealer operations, I think the pain associated with not gathering information correctly and not submitting onboarding documentation properly the first time is felt across all financial businesses,” explains John Gabrik, Customer Advocacy Manager at Appway.
“The fact that the customers involved [in the research] identified NIGOs as being their number one pain point was compelling. Not a total surprise, but it provided some codification around what we have been hearing anecdotally from our customers.”
The survey that formed the report initially came about in August of this year, when Appway were determined to continue measuring the impact of their onboarding solutions across the wealth community.
“The reason behind the report,” Gabrik shares, “was to measure the key benefits of our purpose-built solutions – one of which was broker-dealer-specific, one of which was Canada-specific.”
“Forrester talked to stakeholders in various organizations and then constructed what they call a ‘composite organization’, which is essentially an average of all the evidence collected. They dove into the numbers – and the two key challenges that were identified were 1) improving the outdated, manually intensive, unnecessarily complicated onboarding process, and 2) reducing high NIGO rates.”
And when the composite organization was put together, the benefits of Appway’s solution became very apparent. After utilizing the solution, the number of NIGOs dropped by a staggering 80% – going from a 16% NIGO rate to a mere 3%.
Solving the NIGO problem also solves a host of other inefficiencies and improves customer AND advisor experience and satisfaction. Mid-and-back-office efficiencies were measured to improve by greater than 70%.
As well as the NIGO issue, the report also produced other interesting results, including the benefits of Appway’s solution on advisor and staff training time.
“One of the KPIs that came to light,” Gabrik continues, “demonstrated how long it can take to train new advisors when working with convoluted, legacy processes: It took 2.5 to 4 days on average to train a new advisor on how to onboard a new client. And with Appway’s solution, since it's a guided process, the training for new advisors is cut down to a few hours.”
“Forrester also analyzed green impact. With Appway’s fully digital solution, there's no paper involved – no postage, no mailing forms back and forth. The green analysis – which predicts a 29-ton reduction in greenhouse gas emissions over four years – was an impressive impact that pleasantly surprised even us.”
Based on Forrester’s calculations, the report’s composite organization would save approximately $12 million over four years – and, as Gabrik observes, “if you’re a small firm, those numbers are huge.”
John Gabrik is the Customer Advocacy Manager at Appway.