It's time for Wealth Managers to embrace digital and be truly omnichannel

Jonathan Wauton
March 11, 2021

The need to implement digital strategies is paramount

A year on from the first lockdown and with most of us still cooped up working from home, the pandemic has thrust into the spotlight many of our working practices and processes.

With offices shut and teams dispersed, many businesses struggled to maintain business continuity. Caught off guard by this ‘black swan event’ companies were forced overnight to switch to remote working.

For wealth and financial managers, they found themselves with heavy responsibility for managing money on behalf of clients in unprecedented territory. Overnight digitalisation of client-facing services and processes rocketed up the priority list of wealth firms around the country to meet this responsibility.

A sticking point

It is no secret that digitalisation has long been a sticking point for wealth firms – the sector was memorably described as “one of the least tech-literate” by accountancy firm PwC back in 2016[1]. Aside from the large amount of money, time, and technical expertise it takes to develop a digital offering, a major factor underlying this digital disconnect has, for some time, been a lack in a sense of urgency.

Historically, the majority of wealth management and financial advice clients are – on average – older than those in other financial industries and content with doing things the way they have always been done. Rather than engaging solely with an app, they like to receive investment updates and advice in person.

However, as more wealth passes down to younger clients that have grown up with digital functionality in every area of their lives, the expectation for wealth firms to provide a similar service will only rise. That said, even this growing pool of clients requires some personal interaction when monitoring and managing their portfolio – something evidenced by the slower than expected gains in AUM of the robo-advice sector in recent years.

Firms with predominantly paper-based operations are at a considerable disadvantage when the office is shut. With no digital platform, they are severely limited or even entirely prevented from onboarding new clients or managing existing clients' portfolios and providing them with updates when required.

In contrast, maintaining business continuity will be much more achievable for wealth companies with a digital offering to complement the personal service. Technology can provide the means to automate critical steps of the client management process remotely - think onboarding new customers, creating personalised investment reports and rebalancing portfolios that have become unsuitable. Updates and information can then be provided to clients – once again remotely - on an engaging, secure digital interface that allows them to monitor and personalise their portfolio. If needed, any follow-up queries can be dealt with over the phone or on a video call.

Longer-term benefits

While face-to-face client contact will return in some form, wealth firms caught out by coronavirus have fast-tracked their digital development enormously to ensure they can communicate through more than one channel. However, with digitalisation also bringing many additional benefits in “normal” working conditions, we believe the significance of this acceleration extends beyond today’s environment alone. In particular, we believe that the real change will be to bring about a hybrid operating model, where some services - particularly the advice piece – remains personal and face-to-face, but the time-consuming, costly and ‘messy’ processes such as client onboarding, reporting and other client services will move to customer facing self-serve online processes.

For us at Tiller, we’ve been working closely with our wealth management customers to help them bring about change and introduce digital solutions into their businesses. Our products can be used across the client lifecycle from onboarding, account creation and product selection, to portfolio management and reporting.

One final note worth making, Anna Zakrzewski of Boston Global Consulting summed things up in the Financial Times at the outset of the pandemic when she said:

“Relationship managers in the past saw digitalisation as a threat. Now it’s the only way to do the job,”[2]