Outside Looking In: Reflecting on the Problems in Estate Settlement from an Industry Outsider

Ari Brojde
Founder & CEO

I'll be the first to admit it: I've never had the misfortune of administering an estate.

Yet today, I find myself at the helm of Estateably, a tech company that is moving closer to transforming an industry that has seen very little in the way of innovation for the past few decades.

To the managers, partners, officers and administrators at the trust companies, law, accounting and notarial firms with whom we've engaged in discussion, we are industry outsiders. During introductory meetings, as we acquaint interlocutors with our company mission and vision, we are -- more often than not -- greeted with a healthy dose of skepticism. I can recall one of our very first meetings with a senior manager at a bank-owned trust company, who moments after shaking my hand, asked the question, "Why, may I ask, are you looking to get involved in this industry?"

Indeed during the early days of the company, I often felt that not being an industry insider might be too lofty a challenge to overcome. But over time, I began to realize just the opposite: that being an industry outsider can have its own distinct and powerful set of advantages.

If you're going to transform an existing industry, it's critical to bring a fresh perspective to the table. As a result of having worked in a different industry, you naturally have a unique approach to solving problems. Also, you have a wide array of past experiences to draw on that industry insiders do not.

Because of the lack of practical industry experience, outsiders can tend to be a bit more curious than insiders. And when you're interested, you ask a lot of questions, and when you ask a lot of questions and listen attentively, good things happen.

The first book I read after leaving my job as a private wealth manager in 2015 to start a tech company was Stanford University's Steve Blank's "The Startup Owner's Manual."

The message of Blank's seminal work can be summarized by an oft-used quote "There are no facts inside your building, so get outside."

As outsiders with no practical experience administering estates, it was critical that we take Blank's advice to heart. So before drawing a single wireframe, generating product designs, and before writing a single line of code, we spent months speaking with industry insiders to uncover their pain points.

The more time we spent outside of the building, the more we began to realize that the problems stated were not unique to any single firm, nor industry segment. Every professional executor we met provided honest answers to our questions, and as it turns out, faced the very same problems.

So what problems did our research uncover? From an outsider's view, issues in estate administration exist into two categories: issues with external processes and problems with internal operations and their implications outlined below.

Problems with Internal Operations

There are four common operations-related problems that we've been able to identify throughout our continuous discovery with industry stakeholders:

1 - Excessive Manual Data Entry

Estate administration, as we've learned, is highly manual and labour-intensive. Those completing the day-to-day administrative work frequently complain about the lack of tools and automation made available in the office. In this regard, repetitive form filling and manual entry of transactions into accounting systems topped the list of automation-related demands.

2 - Steep Learning Curves

At trust companies, in particular, training and education for new hires are inconsistent and inefficient. As an aging workforce begins to take their retirement, managers will need to replace them to meet the demand of the practice. Official government statistics suggest that the number of deaths in most jurisdictions will rise by 60-75% over the next two decades. Most new hires will have little experience or knowledge of the estate settlement process. Today, new hires report finding it difficult to locate training information in existing systems of record promptly. They, therefore, need to rely on advice from senior staff, who are consistently too busy with their work to offer immediate help. All this translates into steep learning curves where both staff and managers estimate that it takes over a year for a new hire to get up to speed.

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3 - Tedious Documentation

All executors face significant legal and financial liability that comes part and parcel with their role, and this only increases for corporate executors. As such, there's a necessity to ensure strict regulatory compliance through the maintenance of accurate audit trails and activity logs. Yet, administrators we spoke with admitted that they rarely complete progress reports on time. Instead, their completion occurs weeks later, leading to hastily prepared reports, significant risks of non-compliance, and a lack of visibility to clients.

4 - Inefficient Collaboration

To be done efficiently, the settlement process, especially at a trust company, requires the participation of multiple individuals working on a single file as it passes through the end-to-end workflow. Yet, today, there exists no simple way for various individuals - whether internal or external stakeholders - to access the information they need to collaborate seamlessly around a case file.

Implications of Operations-Related Problems

Identifying problems by asking the right questions is the simple part; the more difficult task is determining what business implications can arise if these problems remain unchecked. From an outsider's perspective, the four issues identified above have a standard set of consequences, all of which can negatively impact the vitality of an estate administration practice. These include, but are not limited to lower staff productivity and non-optimization of resources, which in turn lead to higher labour costs; a disgruntled workforce, leading to greater incidence of staff turnover; poor customer experiences, leading to lower likelihood of future client referrals; and operational inefficiencies, leading to longer settlement times, higher compliance costs, and lower profitability overall.  

Over the next several months, we'll be taking a deeper dive into each of the problems identified above. If you're a manager, trust officer or administrator, attorney, paralegal, accountant or notary in the business of settling estates professionally, we'd love to hear your feedback. Creating meaningful transformation in an industry that has been resistant to change for such a long time cannot be done by one person or company alone.

If there's anything we've overlooked, please leave a comment or send me a note at abrojde@estateably.com!

Ari Brojde
Founder & CEO
Ari Brojde is co-founder and CEO of Estateably, a platform that empowers trust and estate professionals to digitize their practices through automation and enhanced compliance while facilitating practice-wide collaboration.

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