Four top uses of technology in wealth management

Tech­nol­o­gy has long been part of the busi­ness of wealth man­age­ment, but its role was his­tor­i­cal­ly focused on sup­port­ing inter­nal needs of wealth man­age­ment firms in areas such as port­fo­lio account­ing and man­age­ment. Very rarely did the tech­nol­o­gy used go fur­ther and pos­i­tive­ly touch the client.

How­ev­er, we are wit­ness­ing an evo­lu­tion in the appli­ca­tion, flex­i­bil­i­ty and deploy­ment of tech­nol­o­gy in the wealth man­age­ment indus­try. Much of the tech­nol­o­gy used in the past was clunky and real­ly only suit­able for inter­nal use, but we now see rel­e­vant, mod­ernised tech­nolo­gies right through the busi­ness from front to back. Good for the busi­ness, the advis­er and, thank­ful­ly, for the client too.

While much of the news on the client side might focus on fash­ion­able top­ics such as robo-advice, many of the rel­e­vant themes also sup­port the wider devel­op­ment and appli­ca­tion of tech­nol­o­gy through­out the busi­ness. We use the term Built for Wealth, which high­lights tech­nolo­gies built with a focus on the needs of this sec­tor and there has been a sig­nif­i­cant uptick in solu­tions built for wealth man­age­ment.

From the client’s per­spec­tive, mul­ti­ple tech­nol­o­gy devel­op­ments are chang­ing what wealth man­age­ment is, who deliv­ers it, how it is deliv­ered, who it is offered to and what is includ­ed. This ongo­ing change looks set to deliv­er a wealth man­age­ment offer­ing that will be bet­ter for both the tra­di­tion­al wealthy client base as well as increas­ing­ly enabling a wealth-man­age­ment-for-all mod­el.

We see tech­nol­o­gy, depend­ing on the require­ment for any indi­vid­ual wealth man­ag­er, help­ing the wheel spin smoother, faster, straighter, longer and more effi­cient­ly.

Let’s pro­vide four clear exam­ples:

Relationship and communication

What type of rela­tion­ship does a client want? Advis­er led, tech­nol­o­gy led or a mix, to be deter­mined as and when the client requires it? Pre­vi­ous­ly, there was lit­tle or no choice. Tech­nol­o­gy now allows the client imme­di­ate and deep­er access to their port­fo­lios, and mul­ti­ple means to engage their wealth man­ag­er when and where they want and whether by chat, secure email, video or brows­er. This grow­ing flex­i­bil­i­ty rep­re­sents a sea change for the indus­try and the client.

Aggregation and reporting

Achiev­ing a full view of net wealth across bank­ing, invest­ments, debts, pen­sions and more has always been hard. This is chang­ing. Through reg­u­la­tion, tech­nol­o­gy tools and client demand, access­ing a full view is becom­ing increas­ing­ly pos­si­ble across mul­ti­ple providers. Hav­ing access to this view, in one place, is a sig­nif­i­cant step for­ward in the con­cept of wealth man­age­ment.

Behaviour and customisation

What exact­ly does a client need and want? His­tor­i­cal­ly, this under­stand­ing was deliv­ered by the advis­er. That was how cus­tomi­sa­tion was deliv­ered. Tech­nol­o­gy is now chang­ing this to deliv­er an increased under­stand­ing of client behav­iour and, close­ly linked, the poten­tial to then offer a cus­tomised ser­vice, prod­uct and pric­ing to an indi­vid­u­alised pro­file.

Products and investment ideas

All the above also maps well to the new capa­bil­i­ty of wealth man­age­ment to offer a broad­er range of prod­ucts to its client base that, with a greater under­stand­ing of a client’s pref­er­ences, can also facil­i­tate the deliv­ery of improved invest­ment ideas to rel­e­vant clients. Whether exchange-trad­ed funds, alter­na­tives, off-mar­ket deals or more, tech­nol­o­gy is improv­ing access, process, cost and per­son­al­i­sa­tion.

To con­clude, from the client per­spec­tive, the new era of mod­ern tech­nol­o­gy is bring­ing a bet­ter wealth man­age­ment expe­ri­ence, more client cen­tric, more trans­par­ent, more cost effec­tive, more per­son­alised and gen­er­al­ly eas­i­er for a broad­er client base to access. The evo­lu­tion remains ear­ly in its jour­ney, but the build­ing blocks of change and indus­try improve­ment, which are good for all par­tic­i­pants, are increas­ing­ly avail­able and being put in place.