It’s a drastic understatement to say that the wealth management industry is changing. In addition to the uncertainty and disruption caused by COVID-19, shifting client demands, smarter technology, and a more diverse client base are changing how firms do business. Additionally, digital disruption is accelerating and has already shown that firms with smart, modern digital offerings are those who have earned the right to compete in the industry — those who don’t have either gone or swiftly becoming obsolete.
Successful firms, those that maintain their competitive advantage and are prepared to face the industry’s rapidly changing landscape, focus their investments on specialized “productivity” solutions. Specifically, wealth leaders invest in solutions that improve client and advisor experiences, automate repetitive processes, and ensure data compliance.
5 Areas Advisors Are Spending Their Tech Money
In response to the sudden shift to remote work and additional industry demands, top-performing firms prioritized financial investments with resources that support and strengthen digital offerings and capabilities. These include digital onboarding, robotic process automation, cloud migration, cybersecurity and virtual assistant chatbots.
Digital Onboarding
The 2019 World Wealth Report found that 90% of high-net-worth clients place service quality as the primary criteria for selecting a wealth management firm. However, many firm’s onboarding experiences fail to provide the fast, seamless, and personalized experience that today’s clients demand. A survey by Fenergo and WealthBriefing found that 28% of today’s firms take more than 20 days to completely onboard a new client.
Today’s emerging technologies streamline the entire client onboarding process, reducing onboarding time from weeks to just days. Additionally, firms that automate AML compliance and screening free up wealth advisor’s time, enabling them to focus on client needs and offer better, more personalized advice.
Robotic Process Automation
As part of improving the client experience, firms rely on robotic process automation (RPA) to automate repetitive tasks and ensure processes and operations are compliant with company regulations or standards. With faster, more efficient processes in place, employee productivity and customer satisfaction are increased.
Cloud Migration
Cloud migration has become a top priority for dozens of companies worldwide. One driving factor for this rapid growth is the substantial cost savings simply by minimizing expensive IT structures. Additionally, the cloud provides advisors, clients and home office professionals with anytime anywhere access to important financial data. A comprehensive view of processes and teams is provided to wealth management leaders, which streamlines decision-making while clients have the 24/7 access they expect.
Cybersecurity
Assets under management (AUM) of wealth management firms are expected to grow by 5.6% annually by 2025, equaling close to $147.4 trillion — those dollars are likely irresistible to cybercriminals. The top wealth management firms are all too aware of this risk which is why many are allocating financial resources to boost cybersecurity. In addition to client assets, firms need to safeguard private client information to prevent fraud, extortion, or identity theft.
With the uncertainty from COVID-19 still lingering, clients want to know that their information—and their money—is protected. Many firms have responded to this larger attack surface by rethinking their cybersecurity strategy, ensuring they have the right tools available to detect threats and alert IT professionals quickly.
Virtual Assistant Chatbots
On the horizon for wealth management firms are Millennial clients (currently age 25-40) who love technology. These tech-savvy users expect rapid access to their financial information to make fast but informed financial decisions. Should they experience issues or have questions regarding their finances, many will turn to a virtual assistant for instant help.
In addition to fulfilling client expectations, firms that utilize chatbots free up advisors’ time. With a robot answering general questions or concerns, advisors can focus on client-facing operations. Additionally, as AI and ML technology become smarter, virtual assistants and chatbots provide highly personalized, professional advice based on a thorough market data analysis.
Planning for and Investing in the Future
While it may feel like the industry has been flipped on its head over the past decade, the truth is: Fintech-disruption is just beginning. Wealth management firms can only expect these massive industry changes to continue as technology becomes smarter and client needs evolve. The top-performing financial advisors smartly channel funds into technology that not only improve firm efficiency and productivity but provide clients with a modern, seamless experience they’ve come to expect.
About Docupace:
Docupace is a solutions provider focused on digitizing and automating operations in the financial advice and investment industry. Financial services firms use the Docupace Platform (a cloud-based, integrated software suite) to reduce back-office expenses, improve efficiency, strengthen recruiting, and enhance the experience of advisors and investors. With headquarters in Los Angeles, California, Docupace is proud to serve some of the largest independent broker-dealers and registered investment advisers (RIAs) in the financial services industry. For more information, please visit www.docupace.com
