3 Reasons Financial Bots Fail (And What Advisors Can Do)

Automating processes can make your operations incredibly efficient, but without proper setup and maintenance, the financial bots will get things wrong every time — creating more work, not less.

In today's environment, a firm’s future success will largely depend on how well it leverages technology.

Implementing bots is one way advisories can improve their processes, and the benefits of technology are clearly illustrated in Rohini ThoughtLab’s white paper, Wealth and Asset Management 2022: The Path to Digital Leadership.

Boosting revenue, reducing costs, and helping firms acquire and retain customers at higher rates are just some of the ways money managers can benefit when they have digitized, automated solutions.

However, as advisory firms increasingly leverage robotic process automation, they should be aware of ways things go wrong with financial bots. By being aware of these pitfalls and "shortcomings", RIAs of all sizes can take proactive measures to avoid risk and reap maximum benefits.

3 Ways Financial Bots Fail On Advisors

Bots Not Programmed Properly

When things don't work, it's not the bot's fault per se. The problem is how the bot was initially set up.

Robots can only work properly when sequences to complete a routine task are programmed correctly... by humans.

If a step in the sequence is missing, or if the bot was programmed to open the wrong tab and extract the wrong piece of data, then the task will not be done properly. In the end, a human will have to do the cleanup work, as a result of another human's improper programming of the bot.

Changes in Workflow

If steps change in the reporting processes, for example, the bots will need to be reprogrammed.

If the bots are not reprogrammed, however, they will be performing the task incorrectly based off the old steps and logic.

Similar to how it creates extra work for your team when the bots aren't programmed properly, your team will end up doing double work fixing the bots' mistakes, as a result of not reprogramming the bot to handle the changed workflow.

Expecting Bots to Perform Unreasonable Tasks

Some advisors are lagging behind the technology curve, and they may have never heard of RPA, let alone know the difference between RPA and AI (artificial intelligence).

But typically what happens with less-informed customers is that once they learn there is a solution out there can do some things, they assume the solution can do anything.

They may have purchased bots assuming bots can do a task that they really weren't designed to perform, like researching numerous cash and positions breaks. In some of those cases, there is not a clear logic to follow, thus the tasks require human analysis.

And when there is no logic or clearly defined steps, bots will be limited in their usefulness.

What Advisors Can Do to Get the Most Out Of Financial Bots

Recognize the Need for Human Excellence

Yes, in the age of automation, human labor is still incredibly valuable, as mentioned in one of our recent posts.

Bots need to be configured by humans, so whoever is tasked with this responsibility must know the processes inside and out, carefully programming each step, defining the logic, and setting the parameters.

And when workflows change, you or someone else on your team assigned to the task should know how to reconfigure the bots.

In both initial setup and reprogramming, you should test and see if the robots have performed the work correctly.

Seek Outside Expertise

It's understandable if you have no idea how to set up a bot, or question your ability in doing it successfully.

In either case, consider a reputable third-party to set up the bots for your firm. You can even find third-parties that specialize in automating advisory workflows. (Empaxis is proudly partnered with UiPath, one of the world's leading bot developers, to help investment firms automate their processes.)

No matter what you do or whom you choose to work with, the most important thing is knowing there are talented organizations out there to help when you need it.

Set Reasonable Expectations

Know exactly what processes will and won't be automated. This is especially important from an employee headcount and task delegation perspective.

If you misgauge the time that will be saved, your firm might end up over- or under-staffed.

Only by having an accurate knowledge of how much time will be saved, you'll know how to allocate existing personnel to other tasks.

Bots Work When Done Properly

As mentioned earlier, technology and robotic processes can generate efficiencies, but bots can't do their jobs when they are programmed incorrectly or when workflows change.

Furthermore, if bots cannot perform tasks you thought it could, then employee capacity and staffing levels will not be in line with what is demanded.

By no means should you dismiss or give up on bots because things could go wrong.

The benefits of automating processes are too great to ignore, and as long bots are set up properly internally or with the help of a third-party, then it should be smooth sailing from there.

And once you know specifically how much time you'll save, you can allocate the human capital accordingly.

Ultimately, a successful working relationship between humans and robots is what will keep your firm competitive for the foreseeable future.

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