Software development vs. financial planning: an unexpected comparison

November 03, 2016 by Joey Dieringer

A close up of someone using a laptop for software development

About the author

Joey Dieringer

Senior business analyst

Joey focuses on implementing new product features and improving existing ones. He enjoys working with project stakeholders to solve complex problems and improve process.

Here at Advicent we wear many hats, including those related to financial planning and those related to software development. We have great people who fill both of these roles – some experts in one or the other, some experts in both. Combining the two is what is needed in order to remain effective in the FinTech industry.

That being said, financial planning and software development are not two things that are inherently similar – at least that is what I thought prior to starting at Advicent. My background is in software development, but my prior experience has not been in solutions geared towards financial advisors and their clients. I have learned a lot about the financial services industry and have begun to draw some comparisons between software development and financial planning – two topics I once considered very distant from each other.

While planning for some upcoming Advicent initiatives, I started by going through some of the typical steps I would for any project: determining key stakeholders, defining the project’s success criteria, and scheduling meetings. As I went through this process, I began to see some analogies between software development and financial planning, specifically around two prevalent concepts in the development world: cadence and iteration.

Cadence in software development

To successfully plan and deliver any software solution, it is important for the project team to establish and monitor what is referred to as their cadence. This includes holding important meetings, regularly communicating progress, and having a good understanding of what you are capable of delivering in a given timeframe. Establishing this cadence does not happen overnight, but as a team becomes more familiar and comfortable with one another, the cadence becomes smoother and more predictable.

This is not far off from how a financial advisor builds a relationship with a client. As time goes on, an advisor becomes more knowledgeable of their clients’ wants and needs, and their ability to guide them through their particular financial situation improves. It takes time but, much like development work, the benefits of those efforts will become very apparent.

Iteration in software development

In addition to establishing a cadence, it is important for a software team to iterate on what has been delivered. The key concept in iteration is to be constantly improving. The first version of a solution a developer provides is not always (or ever) going to be perfect. Once a team accounts for this, they are better positioned to respond to feedback quickly and effectively. It is easy to get discouraged when the expected results are not immediately visible.

This same concept can be seen in the financial world. For example, an advisor may not secure a client relationship after the first meeting, or a client may not improve the financial likelihood of buying that boat as quickly as they would have liked. It is important to realize that this initial lull in progress is okay, as it is far better to begin and improve than to not begin at all.

Whether you are implementing the latest and greatest software solution, or advising a client on how to save for retirement, the concepts of cadence and iteration can be applied. The methods used for establishing cadence and improving through iteration may present themselves very different between the two fields, but the underlying implications remain the same: as we streamline the way we work together and improve the solutions we provide, we are better positioned to enable everyone to understand and impact their financial future.

To learn more about the NaviPlan financial planning software and its role in the planning process, click here or call (855) 885-7526 to speak with an Advicent representative.