Bold Choices and Competitive Strides for Wealth Management Firms

With the wealth management industry currently undergoing a significant transformation, driven by factors like economic uncertainly and regulatory changes, the emphasis is even more firmly focused on client satisfaction.  The financial advice firms that thrive, will take the bull by the horns and make bold choices to rethink and reshape the client experience.  This change is necessitated by evolving client expectations and FCA Consumer Duty which sets high standards of consumer protection across financial services and requires firms to put their customers’ needs first.

There are so many ways to do this, where do we start?

The world is very different now, with everyone, not just in the financial planning sector wanting, and indeed expecting information to be immediately available at the touch of their fingers. Technology plays a huge role in this, but access to people is also a requirement and the level of information they provide somehow seems to be different too.

Hyper-Personalisation: Exemplary financial advice has certainly not ever been generic in nature, but now the level of personalisation required has increased. Knowing what the client wants even before they ask for it, means you can be fully prepared with the best advice, and being one step ahead of the client conveniently, also sets you apart from the competition.  Data analytics and other Fintech offerings will enable advisers more easily and efficiently to offer tailored advice and products of the highest standard. We reference this more in our WealthTech article called: Wealth Technology: Reshaping Wealth Management Recruitment

Digital Transformation: It’s not however just about having the best possible, pro-active, tailored advice, it’s also about how that information can be accessed. The easier it is for the client to seamlessly access their investment and financial information, through digital platforms or face-to-face, the happier they will be.  This may involve companies rethinking how they provide their services and investing in robust digital platforms and other new technologies, and even embracing the use of AI.

Omnichannel Experience: The need for 24/7 access to information has never been stronger, and therefore the need for providing consistent service across all touchpoints – digital, in-person, and by phone.  For some companies, this may mean a brave and redefining restructuring of how services are provided.

We have mentioned above how the increased use of technology is expected these days and quite frankly, fast becoming unavoidable in providing the level of service required by clients, but what does this actually mean?

Artificial Intelligence (AI): AI is expanding exponentially in every aspect of life, and within the financial services industry can be used in an abundance of ways.  Robo-advisers are becoming more popular, and if we are talking bold choices, then cutting out or limiting human interaction, would definitely be seen as a bold choice.

However, for firms not wanting to go quite this far, AI can take the strain regarding responsibilities like portfolio management, risk assessment, and client services.  With these more measured tasks taken care of, the Wealth Planner will have more time to focus on the level of personalisation that can only be provided by truly knowing their client.

Blockchain and Data Analytics: Letting technology do the background work and anything where the human element could potentially and controversially be called a hindrance can save time, with the added bonus of reducing or eliminating human error.  For example, using blockchain applications for secure transactions, asset management, and compliance can streamline processes and free up time for advisers.

Data Analytics are extremely useful in uncovering insights and identifying new opportunities, providing information that can give the adviser a head start, and once more saving time for them to spend personalising advice.

Onboarding Platforms:  The all-important client experience should under no circumstances be overlooked.  It’s more often than not, the first impression a client has of your organisation and you, and you never get the chance to make a second first impression. With onboarding being an area which can be heavily streamlined by technology, it’s a good place to embrace this new way forward and if carried out impeccably and easily for the client, differentiates you from your competition.  Many firms overlook the importance of this introductory process, forgetting how crucial those first impressions can be.

It’s not enough simply to provide advice, it’s the start and cultivation of a very special relationship.  A relationship that needs to be strong, there needs to be trust and there needs to be a total certainty that you are getting (client) and giving (Financial Planner) the best possible advice.  This certainty on both sides is what makes you retain clients and stand out from the competition, ensuring long-term sustainable relationships.

Holistic Wealth Management: The expectation is high for an all-round service and clients are looking for a Wealth Planner who provides a comprehensive service that goes beyond investments.  Tax planning, estate planning, and philanthropy feature highly on wish lists and firms that offer this will be of interest to those clients wanting that extra level of advice.

Alternative Investments: Where appropriate, offering access to alternative asset classes like private equity, real estate, and hedge funds.

Sustainable Investing: Integrating ESG factors into investment strategies to meet growing client demand.

Digital Financial Planning Tools: Offering self-service tools for clients to manage their finances for those who want this and supporting them in making informed decisions.

We have talked in our blog “Competition, Communication and Candidates” about the importance of using strategic communication to give your recruitment that all important edge.  As the need for attracting and retaining high-calibre wealth management candidates has never been greater, what can you do to enable this?

Focus on Digital Skills: With WealthTech becoming the norm for providing a high-end service, the hiring and developing of talent with strong digital and technological expertise is essential.  Clients expect this level of service and firms need to be up to date in providing it.

Diverse Workforce: For your talent acquisition program to be a success, there mustn’t be a limit to the talent you access.  To obtain a diverse, gifted and special workforce your team needs to bring together differing values, perspectives and cultures, all working together with the same ethical outlook.  The best workforce is a diverse workforce, that listens to each other’s needs with every member feeling equally valued.  Building a diverse team, who work cohesively means that the advice given will also be varied and strong and of the best standard.

Continuous Learning and Appreciation: The hiring of diverse, tech-savvy, high-calibre staff is only the beginning, and it never pays to become complacent.  The best staff will only stay if they are challenged, appreciated and happy in their work environment, with a realistic and healthy work/life balance.  Investment in employee development and happiness is therefore very important in order to become a wealth management firm where people stay and thrive and consequently provide the best level of advice for clients.

Throughout the world we see organisations and people collaborating and forming partnerships where in doing so, they are stronger and able to provide a better offering by working together.  These strategic partnerships are often a force to be reckoned with and by being bold and combining skills, a robust competitive edge can be found.

Collaborations with Fintechs: Partnering with fintech companies provides instant access to innovative technologies and solutions, delivered by those that are the experts in their field.

Strategic Financial Alliances: Collaborating with other high end financial institutions can create a more expansive reach and a larger portfolio of product offerings, and access to high-calibre advisers.

Outreach/College Programs:  Many financial institutions attend careers fairs in order to introduce themselves to students, differentiating their company from the competition and showcasing their specific and unique values and ethics to potential candidates.

Risk Management and Compliance – two separate issues, but also intrinsically linked.  In being fully compliant with financial and other business regulations and also your ethical frameworks, your risk is reduced. Without risk management and strong compliance, you can leave yourself wide open to failure and it can quickly result in client complaints.

Robust Risk Management Framework: Implementing a comprehensive risk management system to protect clients and the firm is a wise move and ensures that a solid base is created from which to offer excellent advice to clients.

Regulatory Compliance: Staying abreast of regulatory changes and ensuring compliance with all relevant laws and regulations is important, and as mentioned above, Fintech can be used to streamline this process so it takes up less valuable, advice-giving time.

Ultimately it’s about the best ways to look after clients and their needs – embracing technology is a great way to support your objectives. By embracing these bold choices and competitive strides, wealth management firms can differentiate themselves, enhance client satisfaction, and position themselves for long-term success in a fast evolving industry.

For other insightful information on WealthTech, check out our article: Wealth Technology: Reshaping Wealth Management Recruitment