Getting the best out of technology in your business

Wealth Management and Private Banking

19 July 2016

Wealth Management and Private Banking


A Meeting of Minds Wealth Management & Private Banking June 2016

Expert: Paul Bayliss, SEI 

Key message

All players in the wealth management industry have to some extent developed a digital interest in the recent years. A digital presence can improve client experience satisfaction scores, reduce costs/improve efficiency, and reduce risk. We would now need to start thinking of technology in the context of value, and decide between investing in the front office or back office.


  •  A focus on front office technology investment could bring greater value than a focus on the back office
  •  Client-facing staff are spending too much time on administrative work
  •  Project management capabilities need to be improved for implementation to happen and in a timely manner
  •  Challenges delegates face relate to regulation, which takes up the time and budget for technological solutions
  •  Cloud technology could be considered as the cost is low and fixed

Key themes

A diagram was presented at the beginning of the roundtable, with the x-axis starting from ‘impacts value/front office’ to ‘less impact on value/back office’. The y-axis increases in ‘end client perception of value’. The line on the chart suggested that focusing on front office tech investments will bring greater return than investing in the back office.

Our expert set the scene with the insight that clients no longer value the technology used for online advice. Instead, if firms can simplify what they put in front of clients using technology, instead of an Excel sheet, then it would be much more appreciated. A variety of reasons were heard around the table for investing in technology:

  • Lowers the regulatory risk, especially tax compliance and suitability
  • Automates the process so that there is a good trail of previous discussions and in one delegate’s case, save 12 weeks of time annually 
  • Reviews asset allocation continuously
  • Frees up sales staffs’ time from administrative work to focus on value creating tasks
  • Getting an elegant solution from the wealth manager to the client
  • Cuts out paper
  • Ensures that fees charged apply to the service offered and not for admin work
  • Leverages technology-led distribution
  • Decreases number of human errors
  • Caters to younger generations’ tastes

One delegate spoke about how the industry is over-servicing their clients, causing a large amount of administrative work. Thus, the value from investing in the back office could be passed on to clients and drive front office value creation as one-third of client-facing staffs’ time is spent on administrative/regulatory work.

The current situation seems to be all talk/no action. One delegate brought to light the fact that there is sometimes cynicism at the senior management level. As they are more distant from administrative work, they lose sight of how much time is spent on it and thus do not necessarily perceive as high a value-add as those on the frontline. There is also the fear of going first when trying out new technology. People want to wait and see the impact of digital solutions on other firms before committing time and money into implementing it themselves.

As we move on to the problems which delegates wish technology could resolve, application programming interfaces (APIs) and stale data were discussed. API relates to the need for ‘systems to talk to each other’ and stale data speaks about problems such as having five different phone numbers for the same client.

There is also the dilemma between buying versus developing technology with in-house capabilities, with the common belief in the room was that developing solutions is going down a dark hole. Interestingly, the major issue seems to have shifted from what needs to be fixed to how to project manage technological implementations. As one delegate said:

“You think something is being done but perhaps due to communication breakdowns it is not always the case.”

One challenge experienced by most delegates is that regulation gobbles up the time and budget for technological advances. In the words of one delegate:

“Regulation will hijack everything. There may be some glossing over at the back end but it is better than humiliation in the public eye for regulation related negativity.”

This is also why RegTech is emerging and why some believe it will always beat FinTech.

Processes which do not add value could be outsourced to cloud technology, where the cost is low and fixed. It could be a great option should wealth managers choose to embrace it. However there are fears of cyber security and leaks, especially in the wake of the Panama Papers as the work could be sub-contracted to 3-5 layers.

On a final note, an insightful delegate offered that the solution may well be to get rid of the back office.


Technology is on everyone’s mind, however the problem now is no longer what needs to be fixed and how. It is time to focus on the project management capabilities of wealth managers. Time is needed to implement these innovative solutions and add value to firms by cutting the amount of time client-facing staff spends on administrative work and by boosting client experience.