Wealth management is a relationship-focused business that demands trust and faith on the part of the clients who put their personal fortunes into your hands.
But the digital revolution is transforming the connection between client and professional. People now form bonds over social media, and the new generation of millenials exhibits an unprecedented level of trust in technology.
Robo advisors like Wealthfront and Betterment are raising incredible amounts of asets as they build online tools to deliver algorithm-based portfolio advice. Traditional firms like Blackrock and UBS are also getting into the robo game with their respective acquisitions of FutureAdvisor and SifFig. Even as technology is forcing firms to adapt, the human touch nonetheless remains critical. Betterment, for example, recently added a human touch to its offering.
Particularly in the higher net worth market segments, advisors will continue to play an important role since personalization and customer engagement will continue to be critical. However, advisors must harness technology to shape the client experience. Technology can increase the global reach of wealth management firms.
There are some universal themes that advisors must consider. First, true digital transformation requires a multidisciplinary team. Advisors, IT professionals, compliance and risk need to work in concert to deliver the best solutions.
The right governance framework is also a critical component of success. While different deparments and business units focus on different applications, there needs to be an overarching governance framework to ensure that each element works to further the global strategy while adhering to regulations and best practices.
For more information, please read:
How to Achieve Digital Transformation | Wealth Management