What will the business model of the future look like and how big an impact will technology have on the customer experience? The discussion revolves around how technology will help wealth managers now and, in the future, and how it can be implemented.
- Businesses need to ask two key questions before starting to develop digital solutions: What are our core value add services and how can we get customers to support our vision of future customer engagement?
- Once that is in place businesses need to create a vision for what the digital requirements of the customers will look like and then take a leap of faith and align their business model to that vision
- Once these are defined, developing digital solutions becomes easier
- One example is to imagine customers’ first interaction with an AI system which would replace the first initial human point of contact (e.g. Amazon Alexa or Apple Siri)
The discussion evolved around how technology can be implemented into the current wealth management business model. A participant raised the issue of automated call centres which guide customers to the right point of contact and that these seldom result in a good customer experience. The question then is how would an AI system be different then the described system?
It was argued that Amazon’s Alexa for example, which is an AI based virtual assistant, does provide a good customer experience and is becoming more popular with the wider public. In the future a similar system might be able to provide a first point of contact which will be able to simulate the human interaction.
Another point raised was who might be the driver of this digital change within wealth management? Fintech firms for example are focused on developing an app which provides “the solution” to wealth mangers and their customers but are dependent on the customer data of the wealth mangers to create it. Additionally, pressure might be coming from customers who demand that certain aspects of their wealth management service might be provided through a third-party app.
Not tackling that challenge might lead to wealth managers purely becoming data suppliers who might be left behind in the digital transformation. A solution might be to develop technology in-house which can represent a costly challenge and another option would be to partner with another firm/fintech company.
Another point raised was that wealth managers are often left with legacy IT systems, which are not entirely coherent throughout firms at times. The challenge represented therefore is how to drive digital change with these incoherent IT-systems? To overcome this issue firms will need to go through the task of systems and data integration to be able to develop the right technologies.
The key value add for wealth managers is their relationship with the client. Technology is seen as an enabler and enhancer of these relationships. For the individual adviser technology might be able to provide better and more targeted advice, which in turn should lead to a better client experience.
Given the breadth of current and new technologies, it is very important to find the right combination of technologies to face the digital revolution.
The key driver for further digitalisation and more advanced technological development within wealth management is the demand and the pressure of the clients/customers. Given that customers generally demand something which already exists, the question will be - have you all been left behind?
Expert: Jaco Cebula, Multrees