Financial professionals and advisors continue to adopt technology to grow their firms, accordingto a report released Tuesday by Fidelity. The report found that notonly are more advisors adopting technology, those who doare outperforming their peers.

The survey follows up on a 2014 survey Fidelity undertook to seehow financial professionals across channels were utilizingtechnology in their firms. It identified a subset of firms thatwere using twice as much technology as their cohorts andwere getting better business results.

Back then, about 30% of advisors fit into this “eAdvisor”subset. The 2016 eAdvisor Study found that percentage has increasedto 40%, according to Tricia Haskins, vice president of practicemanagement and consulting for Fidelity Clearing & CustodySolutions.

That's “definitely moving in the right direction and somethingwe're really excited about because we really do believe thattechnology is going to be an important part of firms that succeedin the future,” Haskins said.

She added that eAdvisors have continued to outpace theirnon-eAdvisor cohorts in their businesses. For example:

• eAdvisors have 42% higher AUM and 35% more AUM per client.
• They're attracting more clients with over $1 million thannon-eAdvisors.
• Their compensation is 24% higher than non-eAdvisors.

The report also found that eAdvisors are happier with theirfirms. Higher levels of satisfaction are important in the face ofthe potential exodus of retiring advisors.

“Those firms that really use technology, that have a culture oftechnology about them, become more attractive in that war fortalent,” Haskins said. “The younger folks coming in are going to bemore attracted to those firms that are really leveraging technologyto help you not only be more productive but also help you havebetter and deeper relationships with your clients.”

Although the report referred to the non-eAdvisor subset as“tech-indifferent,” Haskins stressed that they aren't avoidingtechnology because they aren't interested.

“Many of them are interested and do believe that technology isgoing to help advance their business, but we do find that they alsoare struggling with where to start,” Haskins said.

The constant flow of new releases from technology providersmakes it hard for some firms to identify valuable tools, shesaid.

“It really is difficult to wade through everything that is outthere and to understand what solution is right for you,” sheadded.

There are some ways advisors who are overwhelmed with theoptions available can narrow their search.

Step 1: Start with the end inmind.

Haskins suggested that advisors who don't know where to startlook at where they want to end. “Get a vision of what you want yourend client and prospect experience to be,” she said, “whetherthat's collaborating with them via online collaboration tools,video conferencing, streamlined account opening process [or]planning with a total view of assets.”

A clear view of what they want their clients to have will helpadvisors identify gaps in their current offerings and what theyneed to plug them.

Step 2: Identify growth targets for thefirm.

Haskins pointed out that technology isn't just a way foradvisors to connect with their current clients, but a tool forgrowing a pipeline of new prospects.

“One of the things we find about eAdvisors is that they'rereally looking at not only how to engage their current clients butthe next gen of investors. They're thinking long term about theirbusiness strategy,” she said.

The report found eAdvisors have 10% more Gen X and Y clients,Haskins said. Attracting younger clients is a priority for them,more so than for non-eAdvisors, “and they want to do it in advanceof [them] becoming a majority of their client base.”

She continued, “They feel they have some time right now toimplement these things in anticipation of that generational wealthtransfer.”

Step 3: Meet clients where they are.

Even eAdvisors may have clients who prefer to meet in a moretraditional way. Some technologies like online collaboration toolsor social media communication platforms may seem to target theneeds of younger generations, but other technologies can helpadvisors provide more holistic service regardless of their client'spreferred method of communicating.

For example, almost 90% of eAdvisors have adopted dataaggregation tools, the third biggest priority for firms in the newreport.

Haskins said that's driven by a move toward financialplanning-focused service. “In order to do a really comprehensiveplan, you have to see a total view of assets,” she said. “We thinkaggregation is an interesting thing to keep an eye on.”

Advisors who want to grow their firms need to be able to bringin new clients “while still making sure they care for their currentclient base in the way they want to be served,” Haskins said.

With technology, “It doesn't have to be an either-or; it's anand,” she said. “The way they collaborate and work with theirclients is going to shift over time.”