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Are you a ‘digital magpie’?

Are you a ‘digital magpie’?

The combined pressures of unrelenting regulatory change, the growth of new and disruptive market challengers and increasing client expectations are leading to massive distraction risks for wealth managers and financial advisers.

At times, it can feel that if you don’t tick the ‘digital box’, then someone else will and would they then gain a competitive advantage over your business?

This may be driving some firms to reach for the next shiny new thing, not quite out of desperation but certainly with a view that something is better than nothing…

Don’t get me wrong, there’s massive benefits to be had from adopting digital solutions but the key to getting the most out of digital is controlling it rather than allowing it to control you.

This means putting your customers at the centre of what you do and then working out, as a business, what you want your service proposition to be, what data and technology solutions you need to implement this, and ensuring you join them together in a customer-focused way.

Let’s look at it this way; say you’re reading this article at a time of your choosing, your phone is on ‘silent’, you’re travelling by train – that arrived on time and you have a seat – and you feel calm and in control, the coffee is good!.


Sounds great doesn’t it? However the reality is likely to be somewhat different; it’s more likely you’ve managed to grab five minutes in between meetings and you have any number of emails piling up plus alerts and reminders and what’s that your friends are planning for the weekend?

Yes, technology has transformed our lives, enabling us to be far more connected, productive and efficient. But we need to ensure we are the ones in control of when and how we use it.

There can be a pressure these days to keep up with the latest tools, and a fear of missing out.

This applies equally in business and our personal lives. But in the financial services industry in particular, where the volume of data can be overwhelming, there is potentially a greater risk of becoming distracted. There’s a danger in attempting to adopt new systems as they come along and tick every digital box that can be ticked.

It can be easy to lose sight of why we do things. Does a certain tool or digital process really help a business put effective strategies in place and achieve its aims and those of its clients?

Being strategic 

Firms should think strategically; it’s not about plugging gaps and simply automating manual processes - doing these things without a cohesive, well thought-out strategy, with client outcomes at the centre means running the risk of not achieving your desired results and repeating the whole process in a couple of years.

Regulation, for example, is placing a greater emphasis on communication and engagement with clients, understanding their needs and being able to meet them.

So the temptation is to provide new access points, such as online meetings and secure client portals. These may work, but unless the rationale is clear and it fits into a wider strategy, designed for your customers and your business, there can be a limited benefit to simply adding new tools and systems. 

Even tools and systems that work brilliantly on a standalone basis can have their impact diluted by contributing to the fragmentation of the digital proposition.

Take video-conferencing, for example - used increasingly by advisers and wealth managers to trim the cost of advice, create additional flexibility and give customers an extra access point.

The benefits are clear, both for the company and the client. But busy professionals such as wealth managers and financial advisers, do not want to be using disparate tools with multiple, stand-alone applications.

There’s little point in video-conferencing a client unless it can be delivered on a platform that suits the customer, or in a way that allows the client to view all the necessary information at the same time, for instance.

Good digital engagement tools, like video conferencing that is integrated into a firm’s financial planning software, have the potential to deliver an exceptional proposition for advisers and their clients.

Digital solutions like this must also meet increasingly stringent regulatory requirements around tracking, auditing and recording – not to mention inbuilt functionality to enable firms to meet GDPR requirements around portability, consent and erasure of client data.

It has to be part of a cohesive digital eco-system if the real gains are to be made.

Harnessing the potential 

The transformative potential of digital is not realised by simply moving paper-based processes online (which should be an absolute minimum) or making small efficiency gains.

The real change that technology can drive comes about from using data and connectivity to radically improve, or better yet introduce, new standards and benchmarks in service that a wealth management and financial advisory firm can promote to its customers as a competitive differentiator, while also enabling your business to operate efficiently.

If you get this right you’re on the road to digital transformation. Get it wrong and you’ll soon discover you have a collection of nice shiny pieces that look pretty but don’t deliver the benefits you seek. Or you’re simply creating your next legacy system.

Richard Ross (pictured) is digital product manager at Iress 


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