Q&A on How Financial Firms Should Adapt Technology Post-Pandemic


WITHOUT ANY END YET IN sight with the global pandemic, sectors across the economy are bracing for the long-haul, including financial advisors. Among the chief everyday difficulties for financial advisors is the lack of sufficient technological support.

A recent survey by Broadridge Financial Solutions found that financial consultants faced a series of difficulties in adapting to the pandemic-induced virtual environment. Chief amongst them was not having adequate innovation. As the world begins to accept the pandemic may be a precursor of a new standard, advisors are looking to their firms for technological assistance in preparing to navigate the coming years.

We spoke to Michael Alexander, president of wealth management at Broadridge Financial Solutions, which has closely studied these shifts. Here are excerpts from that interview.

How has the pandemic altered the financial advice and wealth management landscape?

The pandemic has accelerated the shift to digital for wealth supervisors and financial advisors. Clients anticipate advisors to have the proper technology tools to assist them. However, 74% of advisors reported in our survey state that they want their company to have better access to these tools. The pandemic and matching stay-at-home mandates have strengthened that the future is digital and advisors require to make certain they have the correct technology tools to service customers essentially for the long-haul.

The pandemic has likewise changed the frequency in which advisors and customers connect, as we are now available 24/7. Sixty-three percent of financial advisors report that they interact with customers on at least a weekly basis, and 51% of millennial financial consultants interact with their customers daily.

With this regular interaction comes more personalized advice. Advisors consistently share ideas for brand-new financial investment cars with clients, in addition to a personalized analysis of existing financial investment cars. As we continue to live in an unpredictable time, investors desire real-time, regular updates on their financial investments, and consultants require the digital tools to act quickly.

What obstacles has the pandemic brought for consultants?

Financial advisors are seeing their clients ask for more info throughout not only retirement planning and the existing status of investments but likewise info regarding taxes and financial obligation management suggestions. These outcomes are a clear indicator that monetary suggestions are moving toward holistic monetary preparation, and the advisor is no longer just a financial investment supervisor.

According to another Broadridge survey, consultants younger than (age) 40 are four times more likely than older consultants to believe that the primary worth they supply to customers is holistic monetary preparation. Advisors acknowledge that this shift is happening, however, it’s taking place at a quick pace, and wealth management companies need to support their consultants in this shift.

How should firms and consultants be adapting to the “new normal” the pandemic has brought?

For firms to stay competitive, they need to turn disruption into an opportunity and reimagine their operating models, further leveraging technology and integrating it with individual interactions. According to a Broadridge pulse study of 500 C-suite executives and their direct reports, wealth management companies prepare to focus on a range of technology tools within the next 6 months, consisting of modernizing IT platforms and software application engineering, to establish new digital proposals and enhance the capability to rapidly collect and examine information.

As wealth management firms use these tools to browse the effect of the pandemic, they’re finding opportunity in the chaos. According to that exact same survey, 38% of wealth management companies reported that remote working and partnership is among the most significant opportunities that will emerge from the pandemic.

Companies likewise need to show their value as a goals-based and holistic financial planner, but advisors still find that they are lacking insight into their clients’ financial images. In order to succeed in the brand-new regular, consultants should incorporate a customer’s banking, illiquid property, held away properties, and liability details to appropriately provide goals-based recommendations.

Digital transformation is a huge and challenging task. Companies need to be dealing with an innovation partner, internal or external, that is ready to invest along with the firm throughout their innovation improvement.

What dangers do advisors and companies deal with if they do not accelerate their digital transformation?

If firms do not focus on, speed up and make investments that support digital communication and holistic monetary preparation, they could be at threat of losing advisors and stopping working to connect with the next generation of investors.

According to Broadridge data, 77% of monetary consultants have lost business as a result of not having the appropriate technology tools to interact with clients. Over half of the monetary consultants state they typically think about leaving their present firms looking for better innovation, and this number is even greater for millennial consultants.

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