In the financial industry, staying ahead of the curve is no longer just beneficial — it’s necessary. For registered investment advisors (RIAs), this means constantly reassessing the tools and technologies that power their operations.
One area that can be a point of contention for many RIAs is the use of virtual desktops. While this technology may have once been considered cutting-edge, there are now compelling reasons why RIAs should move on from it.
What are virtual desktops?
Virtual desktops enable users to access a desktop environment using any internet-connected device. Instead of using a traditional physical desktop computer, employees can log in to their virtual desktop from a laptop, a tablet, or even a smartphone.
The idea behind virtual desktops is to create a more flexible and mobile work environment, where employees can access their work from anywhere. Virtual desktops are also known as virtual desktop infrastructure or VDI, virtual computers, cloud computers, hosted desktops, and remote desktops.
Why virtual desktops were once popular among RIAs
There are a number of reasons why virtual desktops gained popularity among RIAs. One of the main drivers was the promise of cost savings. Virtual desktops require less hardware and maintenance, which can result in lower operating costs for a firm. Additionally, virtual desktops offered more flexibility and mobility for employees at a time when cloud-based software platforms weren’t as accessible as they are today.
Virtual desktops were also seen as a way to increase security, as data and applications are stored in a central location rather than on individual devices. This was ideal for preventing data breaches and ensuring compliance with regulations.
The pitfalls of virtual desktops
While virtual desktops may have been seen as a viable solution in the past, modern challenges have posed several drawbacks that make them less appealing to RIAs.
Latency: A silent disruptor
Imagine this scenario: You’re conducting an important video conference, discussing financial strategies in real time, and suddenly the connection becomes unstable. The audio starts cutting out, the video quality drops significantly, and you’re unable to clearly communicate your ideas. This is an example of latency, and it’s a common issue with virtual desktops.
Latency refers to the delay in response time when accessing a virtual desktop. This can be caused by a variety of factors, such as network congestion, distance from the server, and even the type of application being used. For RIA operations, where speed and accuracy are crucial, even a small delay can have significant consequences.
The workaround conundrum
RIAs are known for their problem-solving skills, and faced with the complexities of virtual desktops, many have come up with workarounds to try and improve the user experience. However, these workarounds often come with their own set of challenges.
For example, some RIAs have resorted to using local applications instead of accessing them through the virtual desktop. While this may improve performance, it also defeats the purpose of having a virtual desktop in the first place. Others have tried implementing additional software or investing in expensive hardware upgrades, both of which can be costly and time-consuming.
False sense of security
Virtual desktops promised increased security. However, as technology has advanced, so have cyberthreats. With virtual desktops, all data and applications are stored in a central location, making them vulnerable to a single point of failure. If the server is compromised, all information and access are at risk. Additionally, as virtual desktops become more popular, they also become a bigger target for cybercriminals.
What’s more, many virtual desktop users assume that the technology itself will protect their data. The truth is that human error is still a major factor in cyber breaches, and no amount of technology can completely eliminate this risk.
The cost dilemma
While the benefits of virtual desktops may have initially made them seem like a cost-saving solution, the reality is that virtual desktops can end up being quite costly in the long run. Paying for cloud servers and resources is one thing, but the additional expenses for hosting Microsoft licenses and other services to make the platform more efficient can quickly add up. It’s essential for RIAs and financial advisors to evaluate whether the investment aligns with the actual benefits received.
Better alternatives for RIAs
So what are the better alternatives to using virtual desktops that RIAs should consider? One option is leveraging cloud-based software platforms specifically designed for financial advisors. These platforms offer secure and compliant hosting of applications and data, without the latency and workaround issues of virtual desktops. They also come with added benefits, such as integrations with other tools and services, automated reporting, and ongoing support and updates.
Another alternative is investing in high-performance hardware for local applications. While this may require a larger upfront investment, it can provide faster access to critical data and applications without the lag of virtual desktops.
Ultimately, it’s essential for RIAs to carefully evaluate their needs and consider all the options when it comes to technology solutions. Virtual desktops may have once been the go-to choice, but as technology evolves, so should RIAs’ approach to creating a secure and efficient work environment.
Our team at RIA WorkSpace can help your RIA or financial advisory firm find the best technology solutions to fit your unique needs. Contact us today to learn more about how we can support your business and improve your overall operations.