As our industry continues to evolve from a collection of small lifestyle practices into complex, growing businesses, more firms are seeking efficiency and scalability wherever they can find it. Each RIA executive faces a critical challenge: how to serve an increasing number of clients without significantly expanding employee headcount (and therefore, costs). To address this, many firms are adopting a centralized organizational structure, which allows them to streamline operations and better manage growing client demands. By centralizing repeatable, non-client-specific tasks, RIAs can empower advisors to focus on their core strengths: building relationships, understanding client goals and driving growth.
The primary objective of centralization is to alleviate administrative burdens from advisors, enabling them to serve as the “quarterback” of the client relationship. In this model, essential functions such as trading, investment management and client service requests—including money movement and performance reporting—are handled by a dedicated centralized team. Advisors act as the bridge between clients and the firm’s specialized departments, ensuring each client receives the expertise and attention necessary to achieve their financial goals. Without the centralization of these tasks, advisors face burnout as they constantly jump from client to client and play “Wack-a-mole” with each urgent issue that arises. With their focus solely on relationship management, advisors can foster trust, deliver personalized care and encourage referrals from satisfied clients.
Not all tasks are suitable for centralization, however. Firms must carefully evaluate which functions can be effectively managed by a centralized team. To determine this, it is crucial to focus on tasks that meet two key criteria: first, they should exhibit repeatability, meaning they follow a consistent and predictable process; second, they should require non-client-specific knowledge, allowing them to be handled efficiently by a team that does not have intimate familiarity with a client’s unique circumstances. For instance, processing money movement requests or troubleshooting technical issues related to data feeds into the firm’s reporting software can be effectively managed by a centralized team.
What does this look like in action? A centralized organizational structure is typically implemented through the firm’s CRM system. This technology ensures that every request is documented, assigned and completed efficiently. The process often begins when a client contacts their advisor with a specific request, such as, “We just bought a car—can you send $20,000 to our bank account?” The advisor inputs this request into the CRM, which triggers a task for the trade execution team to rebalance the portfolio and raise the required funds. Once the trades are executed, the trading team creates a follow-up task in the CRM for the client service team to monitor the trade settlement and initiate the wire transfer. After successfully transferring funds, the advisor receives a notification via CRM, enabling them to promptly send a congratulatory note to the client.
Similarly, if a client associate receives an email from a client regarding an issue with the client’s performance report, such as missing 401(k) assets, the associate can log the issue in the CRM. The reporting team can then resolve the problem, update the CRM and notify the associate and advisor once the issue is fixed. This centralized approach eliminates the need for advisors to manage operational details, allowing them to focus on client engagement.
By streamlining workflows and reducing duplication of effort, firms can significantly enhance efficiency, enabling them to handle a higher volume of client requests with fewer resources. This operational model not only improves the client experience, resulting in faster response times and consistent service managed by specialized teams, but also bolsters profit margins for the RIA. Additionally, centralization fosters scalability, allowing firms to grow without overburdening advisors or compromising service quality as the number of clients served by the RIA increases. By offloading administrative tasks, firms empower advisors and associates to focus their energy on larger relationships. With many of the day-to-day maintenance tasks covered by the centralized team, the firm’s advisory teams can hopefully drive engagement with higher-paying clients, improving economics for the firm.
With the delegation of repeatable, non-client-specific tasks to a centralized team, firms can truly empower advisors to focus on what matters most: building larger relationships, understanding client goals, and driving growth. With the right technology and processes in place, a centralized organizational structure can transform a firm into a well-oiled machine, delivering exceptional client experiences while positioning the firm for long-term success. For RIAs looking to scale efficiently, centralization isn’t just a strategy, it is the key to unlocking their full potential and ensuring they remain competitive in an ever-evolving landscape.
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