Super charge your most talented wealth management FAs: Augmented Intelligence

Super charge your most talented wealth management FAs: Augmented Intelligence- blog by Don Yerger

Business is booming for wealth management firms. There is a lot of wealth out there and not enough talented financial advisors to provide quality advice and services. Much of the talent is consumed with Ulta High Net Worth (UHNW) customers. But how do you spread that talent to more of the wealthy masses? Wealth Management is fueled by smart people… very busy smart people. Smart investors (or admittedly not so smart investors) looking for smart advice from smart financial analysts. “The industry is already racing to maximize productivity,” Says Oliver Bussmann CEO of Bussmann AG Advisors. “How many assets under management can you manage as a financial adviser? Even in the high-net-worth environment, you have to think about how much can you automate and drive efficiency while not losing that personal touch.”

So how do we spread the wealth (pun intended) of our limited pool of smart Financial Analysts? To answer that question let’s first look at what an FA does. We’ve listed them in priority order:

1. Prospecting
2. Servicing Current Clients
3. Financial Planning
4. Administrative and Compliance Tasks
5. Continuous Education

Let’s focus on the top two. Since one of the key aspects of an FA that effects the customer experience is interacting directly with customers our priority is mainly based on the personal touch. The most critical areas to growing an FA’s Book of Business, a “side effect” if you will of excelling in delivering the highest quality personal touch is Prospecting and Servicing Current Clients, building and managing client relationships. These might also be considered the most critical areas to improving the customer experience and thus retaining customers.

• Understanding client’s goals and fears
• Understanding markets
• Understanding the client’s assets and associated compliance rules
• Understanding the client’s industry
• Understanding complex compliance rules

“Understanding” is a key word here. Many successful FA’s focus on a type of client. The FA may have a head start in “understanding” if they also have similar experience as the client. For example, an FA may focus on the following types of High Net Worth Individual (HNWI) profiles:

• Successful and retired athletes
• Industry specific Business Owners
• Startup business owners and/or CxOs involved in VC’s, complex stock issues, mergers, acquisitions (with sub-focus areas (e.g. software, hardware, professional services…etc.)
• Members of high net worth families

Despite the head start and focus, each one of these categories involves processing massive amounts of data and synthesizing that data into actionable information from multiple sources. Not to mention there is great benefit in understanding at least some topical information across and beyond these areas into other financial service subject areas. According to Aite Group, in occupations where processing data has become relentlessly time-consuming workers are quickly reaching “peak human capacity”. Considering that data analysis is one of the key strengths of AI and the advent of robo-advisors (see why not replace the FA for the wealthy masses allowing the human FA’s to service HNWI’s? Excuse me for stating the obvious, but it’s because people trust other people, they build a relationship with, a person or adviser that is like them, and that has shown them they can provide trustworthy advice and services in the areas that matter most to them. The areas of focus above are built on personal relationships. For example, would a retired athlete be more likely to trust a robo-advisor or another successful retired athlete that has deep experience in Wealth Management? It’s the human touch.

It starts in the prospecting phase by projecting the image of quality and professionalism. Then the follow through into servicing clients by turning that projection to reality, delivering the quality services (the “actions”) associated with and exceeding the expectations set, delivering a great customer experience. Perhaps this is the most critical application of the human touch. The ability to educate clients and convince them to do the right thing will substantially impact the overall success, and potential liability, in this business. (For more, see: These Firms are Tops Among Financial Advisor Clients.) Consider also that many other aspects of an FA’s responsibilities are dependent on these skills, negotiating with wholesalers, compliance officers, regulatory officials and customer service representatives who may or may not be in the mood to help when needed. The ability to maintain a good relationship can make the difference between an inconvenience and lost business. No wonder the most talented FA’s are spread so thin.

If the FA cannot be replaced how can automation help?

“No man is better than a machine, and no machine is better than a man with a machine.” — Paul Tudor Jones

AI and machine learning is also very good at improving the performance of people, FA’s included. AI is to data analysis as a bicycle is to running. Let’s look again at the top two daily activities of an FA. Then we can illustrate where AI can provide “augmented intelligence” to give us the super FA’s that can exceed peek human capacity.

First, AI can look at a limited set of transaction data about the FA’s clients and prospects, then combing huge amounts of external data to predict what the best next action should be.

Salesforce a CRM cloud platform used by many wealth management firms (e.g. Openheimer, Stifel and Morgan Stanley) provides AI solutions for Wealth Management. These firms and others utilize core Salesforce products for FA’s within their organization to improve the performance and “spread the wealth” of talent: Sales Cloud for prospecting; Service Cloud for servicing current clients; and Community Cloud for brokerages utilizing services provided by wealth management firms. Community Cloud is used to control the exposure of applicable customer data and services to brokerage FA’s. Einstein is Salesforce’s suite of AI products that run within Sales Cloud, Service Cloud and the Community Cloud. Let’s see how Einstein is helping FA’s with prospecting and servicing the Client.

Prioritization of prospect and client calls or meetings:

Let’s take retired or retiring athletes as our first example. An FA may spend most of the very early hours of the morning analyzing the newspaper and news feeds. Is an athlete recently retired or about to retire? Is an athlete just started to become prominent in their sport? There’s a lot of athletes out there, and a lot of sports. Combing the news is one way to find out and this can be very time consuming for an FA. AI can take current information about a client and comb sports news to uncover trends in athletes’ careers advising the adviser in identifying and prioritizing prospects. The FA is provided with a recommended prioritization with the background information driving the prioritization first thing in the morning.

For high wealth families AI can predict if any of their children are reaching an age where a trust fund needs to be set up? Have any significant changes to asset values occurred? Have any state or federal laws changed effecting taxes? This may be easy for a few of the portfolios managed by the FA, but the task becomes exponentially harder as the portfolios increase.

Looking at business owner focused FA’s, uncovering mergers and acquisitions will quickly identify new prospects or existing clients to contact.

AI can recommend a prioritization of contacts for the day and provide the reasons for the prioritization, allowing the human FA to adjust the criteria or weights. The FA may continue to do similar data activities for potential top prospects, but Einstein is now able to widen the number of prospects an FA can research and dig deeper into data associated with top prospects.

Similarly, Einstein AI can predict the Next Best Action for a portfolio:

What prospects or clients should be called today based on current events or known client events? What background information is key to understand before calling the prospect or client?

At Dreamforce this year Salesforce has announced two new Einstein features. One is called Next Best Action and runs on the Sales Cloud, Service Cloud and Community Cloud. When an FA is reviewing the prioritized list of prospects or clients Einstein uses an easy to set up machine learning feature to predict the Next Best Action that the FA should take.

The other solution is called Einstein Prediction Builder. Since Einstein was released a few years ago, Salesforce has provided AI and Machine Learning features that could be turned on by business admins, basically by just turning it on. All model building is handled behind the scenes, so that the business admins don’t need to be PhD data scientists. Now that some business admins and technical admins have a working knowledge of applied AI and Machine Learning, Einstein Prediction Builder now allows more sophisticated model building by business subject matter experts that know a company’s data and what is the most impact full way to process that data into actionable information. Einstein Prediction Builder does this all without Salesforce integration to other AI systems. Although it requires an additional license to turn it on, it comes with the Salesforce cloud solutions. Many Solution Integrators, including Marlabs offer Salesforce consulting expertise that can be leveraged by a company new to AI and Machine Learning looking to leverage Einstein.

The tools are available to augment your best FA’s to provide the highest quality of wealth management to more of your clients, perhaps even improving the best FA’s to super FA’s!