Why a Low-Tech Approach Could have Significant Ramifications

InvestCloud, Inc.
Jul 28, 2017 · 3 min read

There is a lot of soul searching in the wealth management industry when it comes to digital. Many believe they know what digital means for their business, but are unsure of how to implement it…others remain unconvinced of its utility.

The approach of most wealth management firms has remained largely unchanged for generations, with only incremental technological changes (such as the adoption of email as a primary source of communication). To carry on this way regardless of mass-scale digital adoption is foolhardy at best, and at worst creates a situation where businesses are struggling to survive, out of touch with the realities of life in 2017.

A business imperative

Clients’ lives are dominated by digital services. Today, 85 percent of all high-net-worth individuals (HNWIs) use three or more digital channels in their daily lives.

A lot of wealth management firms have taken a ‘Band-Aid’ approach to digital — making only incremental changes. This simply isn’t cutting it with clients. While they still see value in personal meetings and events that promote customer relationships, it is the same approach used by every manager, and does not encourage loyalty. A PwC Report from 2016 showed two thirds of HNWIs would not recommend their advisor.

There is a real need to differentiate and move away from the reliance on a low-tech approach and instead adopt a true digital strategy.

The need for speed

There are many hard-coded solutions available in the market, but these often suffer from being slow to implement, clunky to use for both client and manager and slow to update with new capabilities that the client needs. This is not what the client expects from a digital solution — in all other aspects of his or her life — particularly pertaining to communication — they are used to instant access, personalized experiences and customizable functions.

This cannot be achieved by traditional hard-coded software. But it can be addressed by harnessing the power of the cloud.

Cloud computing has come a long way since its first mainstream adoption in the late 2000s. Today, most apps and internet service providers use the cloud to some extent, if not entirely, to ensure on-demand access. Done correctly, wealth managers will have access to a powerful computing tool, which can incorporate vast amounts of data at speed.

The cloud gives clients access to a powerful digital platform that can be completely personalized while giving them a complete view of their wealth. It will incorporate not just their investments, but other personalized features — for example a crowd-funding philanthropy platform, secure messaging services, even bespoke reporting dashboards — tailored just to them.

In today’s world, a low-tech approach won’t deliver the client satisfaction it would have done ten or twenty years ago. Clients expect more — and if operations don’t change now, then the issue will only get worse. Adopting cloud technology is one way to create a seamless digital experience that can be updated and customized at scale — creating a newfound loyalty in the process.

To find out how to deliver client satisfaction digitally, call us at +1 (888) 800–0188 or visit us at InvestCloud.com/demo.

1“Sink or swim: Why wealth management can’t afford to miss the digital wave,” 2016, PwC <http://www.pwc.com/sg/en/publications/assets/wealth-20-sink-or-swim-gx.pdf>.

2 ibid.

InvestCloud, Inc.

Written by

First-class, digital solutions, pre-integrated in the cloud. Modular platform. 670 clients with over $1.7T in assets. www.investcloud.com

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