The client relationship management (CRM) system is core to many businesses. Is that also true for wealth managers? What can you tell us about the role of the CRM in wealth management and what role it has played in the technology infrastructure of wealth managers?
CRM remains a catch-all term for client engagement among many wealth managers and private banks. Research indicates that CRM ranks consistently as the most widely used technology among advisers, yet four in ten of the firms we surveyed in recent original research are falling behind the CRM investment curve.
In terms of a role within the technology infrastructure, wealth managers’ CRM implementation maturity varies widely. While 25% of firms have a fully integrated system, covering the entire client lifecycle, 37% are stalled in the early stages of their CRM journey.
How has the CRM developed in the wealth management space and what has driven the solution in this direction? Is there still a battle, for instance, between the industry-agnostic CRM and the wealth management-specific CRM?
Most CRM systems have evolved to accommodate multiple technologies and data sources. The result is a complex systems landscape.
Today, wealth managers may be running a generic CRM system – which may be strong in sales pipeline management or in reporting. Given the specific way in which wealth managers acquire clients, service and sell to them, a vertical CRM solution specific to wealth managers needs might deliver important operational and process efficiencies. Especially if the solution is designed to provide end-to-end management of prospects and of clients across their whole lifecycle.
The rewards of running a true wealth management CRM are wide-ranging and significant. They span the whole relationship lifecycle. They drive service experience quality for clients and multiple benefits to the institution. These include:
- More accurate prospect profiling and higher conversion rates to fully onboarded client
- Relevance, understanding and affinity-driven client relationships
- Timely and actionable client communication that exceeds expectations
- Operational efficiencies delivered by a centralised and comprehensive system
- Sales and advisory functions no longer need separate platforms
- Process automation reduces relationship manager routine workloads, enabling re-focus on value-creating activities
- Automated compliance checks are built into the sales and advisory processes
- System-generated alerts and intelligent recommendations ensure a more pro-active level of service
Like the portfolio management system and other tools, the functionality and the role of CRM has changed. How has CRM adapted, what functionality should a CRM system have today and what role does it play for a wealth management business?
What should a true wealth management CRM solution deliver?
- Lead and sales pipeline management, with operational support for all relevant sales functions (meeting preparation, proposal management, sharing of content and research)
- Digital client onboarding and account opening – with minimised prospect waiting and attrition
- Deeply holistic client profiling
- 360° client view and dashboards (at relationship manager, desk and region levels)
- Real time views of client holdings and ability to aggregate household level balance sheets
- Automated alerts / notifications
- Individual client opportunity prompts
- Communications history and task management
- AI-enabled functionalities and deep data analytics
For the modern wealth management firm, how can they make the most out of CRM and what are the factors and steps they need to take to get there?
The modern wealth management firm needs to do four key things to make the most out of CRM functionality. These are the tasks:
- Reassess the role of CRM in their client-facing processes
- Realign to fresh and more ambitious goals
- Retool to enable new levels of client service
- Reap the rewards that come from building client service quality, loyalty and value
Looking forward, what does the future look like for the CRM in wealth management? Will the CRM still have a role, will the term CRM be replaced, what will the future CRM look like?
When we return to a closer approximation “business as usual,” one thing is certain; Private banks and wealth managers will need to focus on the R for relationship in the CRM acronym. A deeper and more personal exchange of information and actionable advice will be crucial. The challenge is that financial institutions will have to grow a sense of high touch client support, at a time of huge pressure on their own bandwidths. They will have to do more – and differently – with less. Their relentless focus will need to be on their client relationships.
Wealth managers have the opportunity to move to a whole new level of tailored CRM, where smart data-driven insights will yield benefits way beyond regulatory compliance. Reassess, realign, re-tool … and reap the rewards. This is the progression the whole wealth management industry should be embracing with their CRM, from now on.
