The Goodacre Securities Industry Conference was the “cannot miss” appointment for the UK Securities industry to discuss around the priorities for Wealth Management firms over the coming 12 months. Digitising wealth management is top of mind. As Objectway’s recent research with senior wealth managers and many ongoing conversations with board level executives confirm, the sector sees this as critical in order to achieve client growth and operational scale. Covid-19 has amplified the spotlight on digitising the sector. Indeed, 75% of clients believe that improved digital engagement will make them want to see their wealth manager even more. Client demands have changed and their digital experience is now a real differentiator between firms: a personalised experience is seen as a reason to stay with or choose another firm. As a result, firms must ensure that their digital channels are fit for purpose when it comes to delivering a great overall client experience.
Achieving hyper personalisation
More than half of 48 wealth management firms that Objectway spoke to earlier this year are developing their own hyper personalised strategies and their current state of progress varies considerably. Most firms would like to be able to offer personalised portfolio construction based on client preferences, and 4/10 firms are currently implementing this. One of the major hurdles is the state of data in wealth firms. This is often wide spread in multiple systems and manually inputted leading to duplication and error. Firms are aware and realise the importance of addressing this as they look to change/upgrade their systems.
Achieving operational scale
The vast majority of firms in the industry are not scalable and haven’t been for many years. One of the main reasons for this is inefficient IT and Operations. IT costs as a percentage of total revenue vary significantly across the industry. The median is close to 10%, however the peak is over 30%! Legacy IT systems are a major contributor to this statistic and most firms are burdened with multiple systems, which are not well integrated and require many manual workarounds to communicate. Currently, there is a negative correlation between IT spend and profitability in the market. Firms appreciate that changing and simplifying their IT estate will be a major challenge. There is a shift in the market to consider flexible modular architecture as opposed to a one size fits all approach. Overall, there is a massive opportunity in the sector to improve efficiency and scalability through digital change.
Indeed, during the conference Objectway discussed examples in the industry of firms who have successfully managed to grow at scale post digital transformation.
About Objectway
Founded in 1990, Objectway Group is a leading provider of investment management and digital software solutions to the worldwide financial services industry. Our omni-channel, omni-device software platform supports the rapidly advancing digital revolution within the wealth and investment management segment.
Under the direction of CEO and founder Luigi Marciano, Objectway has seen steady growth since its inception, both organically and through strategic acquisitions, with revenues topping 60 million euros in fiscal year 2015. Our awarding-winning platform is the trusted choice of leading wealth and investment firms across the globe from EMEA to Canada to Central America.
From offices in Italy, Belgium, the UK, Ireland and South Africa, Objectway's roughly 500 employees support more than 100,000 investment professionals in 15 countries, who manage more than one trillion euros in wealth. For more than 25 years, we've kept our focus on a single vision: combining advanced technology with a deep understanding of business needs to help our clients reshape their wealth management services.
