MFS Investment Management, a Boston-based global asset manager with $113 billion in assets, recently went live with on online advice service from Morningstar. Morningstar, the Chicago-based global investment-research vendor, is providing Morningstar Advisor Workstation for MFS' financial advisers.
"We felt that the product was fairly innovative and something that could differentiate us from some of our competitors," explains Bruce Harrington, vice president of product development for MFS Investment Management, adding that he believes MFS is currently the only mutual-fund family using the tool.
Harrington says the MFS, which operates as a wholesale firm, will make the Web-based tool available to MFS' 100,000 financial advisers and sales people, Harrington says. The solution will allow them to educate customers on choosing the right investment products, he explains, using modules, which include hypothetical tools, asset allocation and research functionality. "The asset allocation module was particularly appealing because we have a strategic focus on discipline diversification," Harrington says. "The Morningstar module fit nicely into that strategy."
In addition, Harrington says that he sees the Morningstar brand name as a competitive advantage that an adviser can bring to the table.
The solution is hosted on Morningstar's Web site, Harrington explains, with a seamless integration and branding of MFS' own Web site. The implementation was not a difficult process, he adds, with little more to do on MFS' side than ensure security when linking the sites. "With any service implementation, everything is not going to 100% when you roll out the gate," he says, "but we've given them feedback and they've already improved their system with tweaks or enhancements to make the system more efficient to our business model."
Harrington says that MFS' prior solution for its advisers, CDA/Weisenberger, had come to the end of its contract. Since CDA lacked extensive modules such as asset allocation and research, Morningstar was a logical choice with a comparable price tag, he says. "There's not a ton of options out there right now," he explains, noting that CDA is the predominant tool in the industry. "It would have taken a significant amount of capital and resources to try to build our own system, and we already use other Morningstar products, so there is a nice synergy."
A spokesperson for Thomson Financial, who owns CDA/Weisenberger, declined to comment on this story.
Feedback from MFS' financial advisers has been positive, and product usage has significantly increased since the firm made the switch in the beginning of the year, Harrington says.