Harrington Legacy: 20% Lower Churn with Enhanced Onboarding

Harrington Legacy: 20% Lower Churn with Enhanced Onboarding

Executive Summary

Harrington Legacy Advisors faced significant client churn within the first six months due to a clunky, paper-intensive onboarding process. By implementing a streamlined digital onboarding system with dedicated onboarding specialists and immediate resource access, Harrington Legacy significantly improved the client experience. This strategic overhaul resulted in a 20% reduction in client churn during the critical initial six-month period, preserving valuable assets under management (AUM) and improving overall profitability.

The Challenge

Harrington Legacy Advisors, a thriving firm managing over $350 million in assets for high-net-worth individuals and families, identified a concerning trend: an unacceptably high client attrition rate within the first six months of onboarding. A deep dive into the issue revealed that the traditional onboarding process, laden with paper forms, manual data entry, and delayed access to key information, was creating a negative first impression and leading to early departures.

Specifically, the firm found that nearly 15% of new clients were leaving within the initial six months, often citing frustration with the cumbersome paperwork, lack of personalized attention, and the perceived difficulty in accessing vital account information. This churn not only impacted revenue but also eroded team morale and consumed valuable time that could be better spent on existing client relationships and business development.

The financial impact of this churn was substantial. With an average client AUM of $750,000, losing 15% of new clients translated to a loss of approximately $5.25 million in potential AUM every six months. Assuming an average advisory fee of 1% per year, this equated to a recurring revenue loss of $52,500 every six months solely from onboarding-related churn. Furthermore, the cost of acquiring a new client, estimated at $5,000 through marketing and sales efforts, was effectively wasted for those who churned early, amplifying the financial drain.

Clients complained about the redundant paperwork, often having to fill out the same information multiple times. The delay in accessing online portals and receiving account statements also contributed to anxiety and uncertainty, particularly for clients new to wealth management. The lack of a dedicated point of contact during the initial weeks further exacerbated these issues, leaving new clients feeling unsupported and undervalued.

The Approach

Harrington Legacy Advisors recognized that a fundamental shift in their onboarding strategy was crucial to address the high churn rate. The firm embarked on a comprehensive overhaul, focusing on three key pillars: digitization, personalization, and immediate access.

1. Digitization of Onboarding Documents: The firm transitioned from paper-based forms to digital forms using DocuSign. This allowed clients to complete and sign documents electronically from anywhere, at any time. The integration with their CRM system (Wealthbox) eliminated manual data entry, reducing errors and saving valuable administrative time. This also allowed for a more seamless and secure document management process, enhancing compliance and reducing the risk of lost or misplaced paperwork.

2. Personalized Onboarding Specialist Assignment: Recognizing the importance of human connection, Harrington Legacy assigned a dedicated onboarding specialist to each new client. This specialist served as the primary point of contact during the first few months, guiding clients through the onboarding process, answering questions, and proactively addressing any concerns. The specialists were trained to provide personalized support, tailoring their approach to each client's individual needs and preferences. This included regular check-in calls, personalized welcome packages, and proactive communication about account setup and investment strategies.

3. Immediate Access to Resources and Information: Harrington Legacy invested in improving the accessibility of client resources and information. New clients were granted immediate access to their online portal upon account opening, allowing them to track their investments, view statements, and communicate with their advisor team. The firm also created a comprehensive onboarding guide, available both online and in print, that provided clear and concise information about the firm's services, investment philosophy, and contact information. This immediate access to information reduced client anxiety and fostered a sense of transparency and trust.

The strategic thinking behind this approach was to proactively address the pain points identified in the client feedback. By streamlining the paperwork process, providing personalized support, and ensuring immediate access to information, Harrington Legacy aimed to create a positive and welcoming onboarding experience that would solidify client relationships from the outset. The decision framework was guided by the principle of putting the client first and prioritizing their needs and preferences throughout the onboarding journey.

Technical Implementation

The successful implementation of the new onboarding process relied on several key technological integrations and process adjustments:

• DocuSign Integration: DocuSign was integrated with Wealthbox, the firm’s CRM system. This allowed for the seamless generation of digital forms pre-populated with client data. The integration also enabled automated notifications and reminders, ensuring that clients completed the necessary paperwork in a timely manner. DocuSign’s audit trail provided a secure and compliant record of all signed documents.

• Wealthbox Task Management: Wealthbox was configured to automatically create tasks for the onboarding specialists, ensuring that all necessary steps were completed for each new client. These tasks included sending welcome packages, scheduling introductory calls, and providing ongoing support. The CRM also tracked client interactions and feedback, providing valuable insights into the effectiveness of the onboarding process. A key task was ensuring each client received a phone call from their dedicated onboarding specialist within 24 hours of initial paperwork submission.

• Client Portal Enhancement: The client portal was redesigned to provide a more user-friendly experience. Key features included a personalized dashboard displaying account balances, investment performance, and recent activity. Clients could also access their statements, tax documents, and other important information through the portal. Single Sign-On (SSO) was implemented to streamline the login process and improve security.

• Security Protocols: Enhanced security measures were implemented to protect client data. This included multi-factor authentication for online access, encryption of sensitive data, and regular security audits. The firm also provided training to employees on data privacy and security best practices. Data loss prevention (DLP) measures were implemented to ensure that sensitive client data was not inadvertently shared or leaked.

• KPI Tracking: Key Performance Indicators (KPIs) were established to monitor the effectiveness of the new onboarding process. These included client churn rate, client satisfaction scores (measured through surveys), time to complete onboarding, and the number of support requests related to onboarding. These metrics were tracked on a monthly basis to identify areas for improvement.

Results & ROI

The implementation of the streamlined onboarding process yielded significant positive results for Harrington Legacy Advisors:

• 20% Reduction in Client Churn: Client churn during the first six months decreased from 15% to 12%, representing a 20% relative reduction. This translated to retaining approximately 3 additional clients per year for every 100 new clients onboarded.

• Increase in Client Satisfaction Scores: Client satisfaction scores related to onboarding increased by 30%, as measured through post-onboarding surveys. Clients specifically cited the ease of completing paperwork, the personalized support from their onboarding specialist, and the immediate access to resources as key factors contributing to their satisfaction.

• Reduction in Time to Complete Onboarding: The average time to complete the onboarding process decreased from 3 weeks to 1 week, thanks to the digitization of paperwork and the proactive support from the onboarding specialists. This freed up administrative staff to focus on other tasks.

• Increased AUM Retention: The 20% reduction in churn directly translated to increased AUM retention. Retaining an additional 3 clients per 100 onboarded, each with an average AUM of $750,000, resulted in an additional $2.25 million in AUM being retained.

• Revenue Growth: With advisory fees of 1% per year on the retained AUM, the firm realized an additional $22,500 in recurring revenue annually as a direct result of the improved onboarding process. This represents a significant return on investment for the technology and personnel costs associated with the onboarding overhaul.

• Improved Operational Efficiency: The elimination of manual data entry and the automation of tasks saved the administrative team an estimated 20 hours per week, allowing them to focus on more strategic initiatives.

Key Takeaways

• Prioritize the Client Experience: A positive onboarding experience is crucial for building long-term client relationships and reducing churn. Invest in creating a welcoming and supportive environment for new clients.

• Embrace Technology: Digitization can significantly streamline processes, reduce errors, and improve the client experience. Invest in technology solutions that automate tasks and provide clients with easy access to information.

• Personalize the Onboarding Process: Assigning a dedicated onboarding specialist can provide clients with personalized support and guidance, fostering a sense of trust and connection.

• Measure and Track Your Results: Establish KPIs to monitor the effectiveness of your onboarding process and identify areas for improvement. Regularly solicit client feedback to ensure that you are meeting their needs and expectations.

• Secure Data: Security is paramount in the digital age. Invest in data protection measures and educate staff to maintain client trust.

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