Although many firms are still looking at reactive, defensive reasoning, there is a keen interest in the aggressive, data-driven plays typical of FinTech, according to Theo Paraskevopoulos, CEO, Invessed. 2020 could be the year that real innovation kicks off. In particular, customer intelligence and behavioural analytics are both enabling technologies in terms of collecting data and extracting value personalisation and automation.

Challenges: What do you see as the main technology and technology-related challenges for the wealth management sector through 2020?
Companies are affected by different technology trends depending on where they find themselves in their journey of digital transformation (DX). Across the response, I will refer to:

• Early stage companies - siloed systems; rudimentary digital experiences (i.e. just a brochure website); traditional marketing roles; cyber-security as an afterthought
• Evolving – combination of modern and legacy systems; a basic customer portal; digitally-aware marketing roles; cyber-security aware
• Advanced – mostly integrated systems; fully-featured investor portal or app; hybrid IT-marketing (digital) roles; security-by-design

Companies still at the early stage, face an urgent business risk of redundancy. Their focus on personal relationships is great, but customers demand digital engagement, and their position looks increasingly outdated. The biggest technology-related challenge though is security. A data breach from an antiquated system can cripple the entire business.

Evolving companies primarily face velocity and budget challenges. As FinTech solutions gain traction and big tech ponders a move, they risk losing market share if technical complexity delays them. The technical risk here is dealing with legacy, which can deplete budgets and stall progress on any digital project.

Digitally advanced firms, on the other hand, are worried about realising (and proving) the value created by their investment so far. Without tangible proof, management may withdraw their support for digital and scale back operations. Without agile operations, they will have trouble delivering continuous innovation and business value.

Opportunities: What do you see as the main technology and technology-related opportunities for the wealth management sector through 2020?
Early stage companies clearly need a ‘spark’ to get them moving. In 2020, modern CRMs and Digital Experience Platforms are beginning to specialise. These systems can deliver security, reporting and document management in one go, setting late adopters on their way.

At the same time, 2020 could well be the year when cloud providers prove that they are bigger, cheaper and more secure than internally built networks. With things like virtualisation, service buses and microservices coming of age, evolving companies can reduce time to value dramatically.

For advanced companies, 2020 can be the year to create value through AI and machine learning deployed to personalise service or automate processes. An increase in Customer Lifetime Value (LTV) and / or reduction in personnel costs would prove the value of this proposition beyond doubt.

Market focus: When considering your wealth management clients and prospects, where are they currently focusing their technology investments and resources: clients, advisers/staff or their business infrastructure?
Most of our clients are around the evolving end of their digital transformation journey. Having recognised the need to drive change, they have hired talented digital people and are beginning to empower them with budgets that look adequate enough to tackle the challenges ahead.

It must be said that conversations still tend to start with reactive, defensive reasoning – fine-tuning the user experience, data management, Cloud migration and keeping up with security and regulation demands.

However, there is a keen interest in the aggressive, data-driven plays typical of FinTech, and some copy-cat moves are underway. 2020 could be the year that real innovation kicks off, possibly triggered by a FinTech / BigTech making a bold move for the mass affluent segment, with clear sights on the HNWI market.

Excite: When you look at the technology capabilities and resources now available to the wealth management sector, as a solution provider, what excites you most in 2020?
We agree with Gartner’s Hype Cycle that machine learning expectations have some way to go before benefits can be realised – a process that would take some time. Instead, we think the most exciting technology for 2020 would be customer intelligence, and especially behavioural analytics, as both enabling technologies (data collection) and value extractors (personalisation, automation) have come of age.

It is all about data. What insights can we glean by collecting and combining data from websites, portals and CRMs? Could we use the Internet of Things to track behaviour from events, visits and meetings? Could a customer’s digital journey describe their needs better than a dry risk appetite questionnaire?

We have barely scratched the surface of customer behaviour and intelligence in wealth management. This data can release so much value that we invite clients to track their Data under Management (DuM) as well as traditional AuM.  

Your support: Finally, as a solution provider to the wealth management sector, what will you be doing in 2020 to help your clients and prospects meet their main technology and technology-related business needs?
Invessed is designed for firms in all stages of their DX journey. The product roadmap is adjusted continuously to help them tackle the challenges and make the most of the opportunities presented by technology and competition. In 2020 that means:

• A turn-key version of our experience offering, enabling early stagers to deploy a fully featured portal with minimum implementation effort – under the headline of ‘Security is a design issue.
• Expanding the library of CRM / data integrations and cloud tools, to help evolving companies move faster and check costs – delivering the objective of ‘Self-funding projects’.
• For digitally advanced firms, expanding behavioural tracking across channels, further R&D with ML Insights, BI and data consulting services. It’s all about data, and a metric of ‘Data under Management’ (DuM).