Financial advisory firms need to make use of social networking technologies to manage customer relationships, financial planning and client retention.

1. Financial Advisory in a Social World
Given the ubiquity of social networking, financial advisory firms must
focus on creating a technology platform using social networking concepts,
which will allow them to interact with clients in a 24x7 environment.
Executive Summary
Financial advisory is a high-touch, client-facing
business. In today’s complex financial invest-
ing world, the financial advisor’s role in helping
customers manage their finances has become
extremely critical. This fast-moving world also
calls for advisors to be available for their clients
at all times to be able to engage, educate, focus
and reassure them. We believe that the financial
advisory business will need to adopt a socio-
business view to bring customers together, and
also closer to their advisor, using Web 2.0 tech-
nologies that will enable them to share, interact
with and benefit from social networking.
In this paper we propose a socio-business frame-
work for financial advisory firms to understand
the enterprise benefits that a social networking
technology platform can bring to their businesses.
Introduction
Stacey Gilbert manages the treasury operations
of a mid-tier technology company. She has been
on the lookout for a good investment opportu-
nity for the unused cash pile that her firm has
amassed over the past couple of years. She
wants to invest this cash in assets that are safe,
liquid and short-term. Mark Kemble, her financial
advisor from ABC Bank, proposed some money
market instruments as possible investment
options. However, Stacey realizes it will take
further meetings with Mark to fully understand
the products and decide if they meet her needs.
Unfortunately, Mark will be away for the next cou-
ple of weeks and will not be available to discuss
the products with her. From her past experience
with the bank, she knows that once she finalizes
the product, there will be plenty of paperwork to
complete before she can actually invest. Time is
running out as she has been under pressure from
her management to reduce the cost incurred on
the idle cash.
In the not-too-distant future, we believe, profes-
sionals like Stacey will be able to conduct busi-
ness with their financial advisors using social
networking platforms. This will allow them to
interact and transact with their advisors in the
manner and at the time they want.
Social networking has been around for several
years. Fuelled by Web 2.0 technologies, it has
now become arguably the most popular means
of interacting, collaborating and networking with
people and organizations. Over 66% of all adult
Internet users are connected to one or more
social media platforms,1
spending on average
about 400 minutes per month on popular social
networking sites such as Facebook and Pinterest.2
cognizant 20-20 insights | july 2013
• Cognizant 20-20 Insights

2. cognizant 20-20 insights 2
The central idea for financial advisors is to create
a “blue ocean” capability by fashioning a technol-
ogy platform using social networking concepts,
which will allow them to interact with clients and
run business operations.
Current Business Landscape
A financial advisor to individual and institutional
investors is responsible for establishing the
liquidity needs, return needs and risk appetite of
the investors, based on which appropriate goals
and objectives are decided and an overall finan-
cial plan is drawn up.
The process flow in Figure 1 provides a simpli-
fied overview of traditional financial planning as
practiced by most financial advisors.
To start the financial planning process, the client
is expected to provide all financial information
right at the beginning, or else multiple appoint-
ments and meetings are scheduled until all the
relevant information is obtained. The linear
financial planning model makes the data gather-
ing exercise daunting for the client and could lead
to procrastination on the client’s part.
From a financial advisory perspective, it is inter-
esting to note that most users on social media
platforms are over 25 years old and the fastest
growing segment is over 50 years of age. Today,
clients are getting used to
a collaborative and inter-
active way of life that is
driven by social networking
technology. The next gen-
eration of clients will take
this for granted. Therefore,
it is important for financial
advisors to offer a full set
of services via media that
clients are accustomed to.
Social networking presents
a unique business opportu-
nity for financial advisory
firms to not only connect
advisors, clients and other
stakeholders with each
other in a 24x7 “always
on” environment, but also to provide products
and services to clients and perform internal
processes.
The central idea for
financial advisors
is to create a “blue
ocean” capability
by fashioning
a technology
platform using
social networking
concepts, which
will allow them to
interact with clients
and run business
operations.
Traditional Financial Planning Process of Financial Advisory firms
Figure 1
Objective
Generate
Financial Plan
Current
Financial State
Future
Financial State
Describe Gap
Develop a Plan
Gather
Relevant
Information
Information on
Current Income,
Expense, Assets
and Liabilities
Short-term and
Long-term
Financial
Needs
Financial Needs
and Current
State Deviation
Finalize on the
Plan to be
Implemented
Analyze
Information
Strategy Process Flow Experience Outcome
Fix appointment & schedule
multiple interviews
Share hard-copy of document
Review materials, prepare
questions for interview,
gather information
Conduct interview, have
multiple in-persion
discussions
Analyze current and future
state to identify the needs,
shortfall
Prepare and share an outline
with recommended financial
products
Discuss and get feedback &
views
Make modifications as per
discussions

3. cognizant 20-20 insights 3
After the exhaustive data-gathering exercise, the
financial advisor completes financial planning
projections for the client. Financial advisors may
take several days or weeks to analyze the client
information, and schedule an appointment to
present the results. During the presentation, if the
client shares new information or wishes to look
at a different version of the projections, further
analysis takes place for several days or weeks,
which is followed by another meeting. Such an
experience discourages clients from testing the
plan with multiple possibilities in terms of life
events. Instead of providing
clients with a positive inter-
active experience, financial
advisors end up providing a
slow, back-and-forth itera-
tive process.
Financial planning is no
longer about delivering the
”plan” as an end product. It
is about continually align-
ing the clients’ money with
their goals, as their lives
and circumstances change.
This means that the value
of financial planning is
rooted in the ongoing experience that the client
has while engaging in the planning process.
We believe that the continuing maturity of the
financial advisory profession, advancements in
technology and changing customer behavior
patterns will define the “future of work” for the
financial advisory business.
We propose a “socio-business framework”
for financial advisory firms. We believe this
framework will enable firms to use social media
concepts to enable a more efficient, interactive
and collaborative association between internal
and external stakeholders.
Socio-Business Framework
The socio-business framework allows advisors
to be responsive, attentive, willing and able
to provide the information or assistance that
clients need. Clients who have a positive experi-
ence interacting with the advisor are more likely
to buy a product or service, recommend the advi-
sor and/or continue with the existing relationship.
The basic elements of the socio-business frame-
work for the financial advisory business are:
We believe that the
continuing maturity
of the financial
advisory profession,
advancements in
technology and
changing customer
behavior patterns
will define the
“future of work”
for the financial
advisory business.
Social Experience
Figure 2
InformationGatheringFinancialPlanning
Gather Client Info
Assess and Evaluate
Client Data (Risk
Appetite, Financial
Health, Age Group, etc.)
Interact
(Text/Video)
Plan
Sign-off
Discuss Financial Plan
Client-Advisor
Private Network
Client Network
(Peer/Expert)
Interact (Text/Video/Chat)
Upload/View Cash-flow
Projections
Disclosure Agreement
Advisor
Create
Plan
Advisor
Client
Peer/
Expert
View
Client Peer
Network
Client
Experts

4. cognizant 20-20 insights 4
Social Experience
The social experience is all about information
seeking and information dissemination. It is
driven by:
• Exploring the advisory marketplace looking
for resources and information that will help
clients chart the financial course to meet their
objectives. This includes connecting clients
to each other to enable peer support and to
make clients feel connected to and a part of
the organization.
• Formulating a plan to achieve the desired
outcome through interactions with the finan-
cial advisor, peer groups and expert groups.
• The course of action selected by the customer
is validated by objective evidence. Reinforce-
ment may come in the form of expert reviews,
peer comments and other trusted sources.
Connect and Collaborate
Customer interactions with an organization
typically do not make it past the employee speak-
ing with the customer. In a social business frame-
work, the customer can connect with a wider
group, involving peers and other employees.
When the customer submits a request or gives
feedback on a product or service, these can be
discussed internally within the employee network
for viability and feasibility, and a response can
be sent to the customer. Also, the feedback or
request can be debated and discussed within the
client’s peer group.
Objective-Driven Networks
Clients view the organization as one entity and
expect it to function as a single unit and not
as functional silos. The socio-business frame-
work provides mechanisms that make everyone
in the organization responsible for collabora-
tion. For instance, financial advisors, the client
management team and the marketing team can
collaborate in a social network for the customer
onboarding process.
Technology
Social technology is about communication using
electronic devices and networks. Socio-business
for financial advisory can benefit by:
• Choosing social tools based on the way
the business communicates, whether it is one-
to-one conversations or broadcasting, text or
audio, feeds or streams.
• Enabling individuals to use the device
best suited to their needs and keeping them
connected everywhere and at all times.
• Adding social collaboration capabilities to
the applications employees use to do their
jobs, and allowing information sharing within
the context of business processes.
Compliance
In order to comply with most industry and
government regulations, including FINRA, all
company data including electronic communica-
tion traffic over blogs, discussion forums, private
chat and message broadcast are archived and
stored. Social technology can enable these to be
easily retrieved for regulatory compliance and
legal discovery.
The goal of the socio-business framework is to
create an environment where clients feel that the
Event/Campaign Management
Figure 3
EventManagement
Advisor
A client can be part of at least
one event network. An example
of this would be segmentation
based on risk appetite, financial
goal, etc.
Event
Network 2
Creates
Client
Network
Assigns
Client
Assigned to
Event
Network 1

5. cognizant 20-20 insights 5
journey to their desired outcome is easy and rel-
evant to their needs.
Conclusion
Conducting financial advisory business over a
technology platform built using social networking
concepts will become as ubiquitous as Internet
and mobile banking are today. The time is ripe
for financial advisors to understand, evaluate
and embrace a technology-driven socio-business
culture. They need to understand and assess the
impact of this culture using the socio-business
framework and then create a roadmap of how to
transform their business operations to emerge as
leaders in the industry.
Figure 4
ProspectsManagement
Advisor Look-up
Search for
Advisor
View Advisor
Profiles
Convert a Lead
Exchange Messages
Within Lead Network
(Private/Public)
Interact with
Advisor
(Private Text/Video)
View
Demo
Handle Queries/Support
Call
Center
Manage a Campaign
Launch
Campaign
Interact Within
Campaign-Specific Network
Join &
Participate in
Campaign
Publish
Marketing
Material
Track
Campaign
Client
Volunteers
Request to Register
(Directly)
Add Prospect
to Lead
Network
Request to
Register
(Through
Campaign)
Advisor
Advisor
Advisor
Prospect
Prospect
Prospect
Other
Leads
Other
Prospects
Prospect/Lead Management
Footnotes
1
http://pewinternet.org/Commentary/2012/March/Pew-Internet-Social-Networking-full-detail.aspx
2
http://www.blogherald.com/2012/06/07/social-networks-broken-down-by-demographic-infographic/
References
• Information on usage of social media, http://ansonalex.com/infographics/social-media-usage-statis-
tics-2012-infographic/.
• Social media and decision-making, http://dssresources.com/faq/index.php?action=artikel&id=225.
• Gilder, G., “Metcalf's Law and Legacy,” Forbes ASAP, September 1, 1993, http://www.discovery.org/a/41
and http://www.gildertech.com/.
• Usage of social media for investments decision-making, http://mindfulmoney.co.uk/10057/investing-
strategy/incorporating-social-media-into-investment-decisionmaking.html and http://money.usnews.
com/money/personal-finance/mutual-funds/articles/2012/01/31/investors-increasingly-tap-social-
media-for-stock-tips.
• Making a case for socio-business network, http://www.altimetergroup.com.

6. About Cognizant
Cognizant (NASDAQ: CTSH) is a leading provider of information technology, consulting, and business process
outsourcing services, dedicated to helping the world’s leading companies build stronger businesses. Headquartered
in Teaneck, New Jersey (U.S.), Cognizant combines a passion for client satisfaction, technology innovation, deep
industry and business process expertise, and a global, collaborative workforce that embodies the future of work.
With over 50 delivery centers worldwide and approximately 162,700 employees as of March 31, 2013, Cognizant is a
member of the NASDAQ-100, the S&P 500, the Forbes Global 2000, and the Fortune 500 and is ranked among the
top performing and fastest growing companies in the world.
Visit us online at www.cognizant.com for more information.
World Headquarters
500 Frank W. Burr Blvd.
Teaneck, NJ 07666 USA
Phone: +1 201 801 0233
Fax: +1 201 801 0243
Toll Free: +1 888 937 3277
Email: inquiry@cognizant.com
European Headquarters
1 Kingdom Street
Paddington Central
London W2 6BD
Phone: +44 (0) 207 297 7600
Fax: +44 (0) 207 121 0102
Email: infouk@cognizant.com
India Operations Headquarters
#5/535, Old Mahabalipuram Road
Okkiyam Pettai, Thoraipakkam
Chennai, 600 096 India
Phone: +91 (0) 44 4209 6000
Fax: +91 (0) 44 4209 6060
Email: inquiryindia@cognizant.com
­­© Copyright 2013, Cognizant. All rights reserved. No part of this document may be reproduced, stored in a retrieval system, transmitted in any form or by any
means, electronic, mechanical, photocopying, recording, or otherwise, without the express written permission from Cognizant. The information contained herein is
subject to change without notice. All other trademarks mentioned herein are the property of their respective owners.
About the Authors
Sathish Thiruvenkataswamy is a Senior Manager within the Cognizant Business Consulting (CBC)
Practice. He has over 11 years of technology and consulting experience in the banking and financial sector.
Sathish holds a post graduate diploma from IIM Calcutta and earned his bachelor’s degree from National
Institute of Technology Silchar. He can be reached at Sathish.Thiruvenkataswamy@cognizant.com.
K B Venkatasubramaniam is a Senior Consultant within the Cognizant Business Consulting (CBC)
Practice. He has over nine years of technology and consulting experience in the banking and finan-
cial sector. Venkat holds a post graduate diploma from T.A. Pai Management Institute and earned his
bachelor’s degree from Sri Venkateswara College of Engineering (University of Madras). He can be
reached at Venkatasubramaniam.Balasubramaniam@cognizant.com.
Sumit Srivastava is a Senior Consultant within the Cognizant Business Consulting (CBC) Practice.
He has over six years of technology and consulting experience in the banking and financial sector.
Sumit holds a post graduate diploma from IIM Lucknow and earned his bachelor’s degree from Delhi
College of Engineering. He also cleared the financial risk management (FRM) examination in 2009.
He can be reached at Sumit.ShankerSrivastava@cognizant.com.
• Traditional Approach in the financial advisory business, http://www.bellaonline.com/articles/
art9351.asp, http://www.fa-mag.com/, http://www.bargaineering.com/articles/interview-with-a-finan-
cial-advisor-jlp.html, http://smallbusiness.chron.com/core-business-processes-financial-services-780.
html and http://www.riabiz.com/a/7166554.
• Improving customer experience through social technologies, http://socialenterprisetoday.com/
blog/posts/how-social-technologies-contribute-to-a-better-customer-experience/, http://www.mycu-
stomer.com/ and http://www.supportindustry.com.
• Impact of socio-business model, http://futureofcio.blogspot.in/2012/01/seven-business-visions-
social-business.html.
• Financial planning process, http://www.kitces.com.
• Business Benefits, http://www.zdnet.com/blog/hinchcliffe/assessing-the-business-benefits-of-social-
business/1487.