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Why a holistic approach is the future for wealth management

The wealth industry is changing. As a recent Wealth and Asset Management study suggests, firms now expect up to three-quarters of their interactions with clients to be conducted digitally within two years.

In line with the changing attitudes towards digitalisation, the Global Wealth and Asset Management Study uncovered that 40% of investors view being granted digital access to services as a priority when dealing with Wealth Management firms. 

But how does this impact the client-adviser relationship? How can financial planning and wealth management firms adapt to this rapidly shifting marketplace?

The key to success lies in embracing the added value that advisers are uniquely placed to provide: a holistic approach to helping clients achieve their overall life goals and sustained financial health.

So what are the trends driving the market?

Let’s explore the key trends that drive the shifts in the market outlined by the Wealth and Asset Management Study in more detail.

Investors expect more choice

A significant minority (around 39%) of investors look to their chosen wealth management firms for goal-based financial advice. As the data suggests, this trend will continue to rise within the foreseeable future, with the industry anticipating approximately a 10% increase in demand for retirement, next-generation succession and real-estate investment planning advice over the next two years.

The evidence indicates that firms that widen their portfolio of products, thereby offering more choice to clients, are better positioned in years to come to outperform those that don’t.

Investment in new digital channels is paying off

Financial planning firms are already seeing the rewards from digital investment, with over one-third of firms reporting a high ROI during the 2021 study.

This is no surprise given the growing expectation among investors for more personalisation and accessibility. The next challenge is to leverage advancements in digitisation to offer a more bespoke journey.

Put simply, firms should be offering a wider range of solutions provided via channels that are convenient for them. For example, a massive 89% of investors have singled out mobile apps as the channel set to become their preferred medium of interaction over the next two years.

Investors continue to value the human touch

While the rise of hybrid human-digital advice solutions allows firms to widen their offering and reach new markets, the benefits of a strong client-adviser relationship are apparent.

The demand for more holistic products and services means a personalised approach is needed. Moving away from static demographic details that might consign a consumer to the ‘mass-affluent’ or ‘UHNW’ box is critical. After all, an individual’s needs vary throughout their life. The more firms ask ‘where is the client in their journey?’ rather than ‘which box they fit in?’, the more relevant and high quality the final advice will be.

And that’s not all. Approaching the advice process in this way – where each individual is a moving target with evolving needs – will also encourage more robust fact-finding. Advisers will be less tempted to rely on pre-determined ideas based on demographic data or stereotypes.

Instead, the onus will be on firms to offer a more comprehensive set of options alongside personalised advice, ultimately empowering clients to make an informed choice that fits their situation.

How to achieve the holistic approach?

Having talked about and recognised the importance of a holistic approach to serving clients, let’s consider the tools you need to get there.

1. A client-centric culture

Optimised client outcomes will need a more profound cultural shift in the way firms approach the advice process and client relationships. It will inevitably take a clear focused organisational culture strategy to make such an approach work in the long run.

That’s why it’s so vital that senior management leads by example and champions a people-focused, purpose-led business strategy motivated by achieving the best possible outcomes for clients.

Compliance and conduct focused firms, like TCC Group, lead the conversation in organisational culture and offer Intelligent Culture Analytics tools to help firms measure, track and transform their organisational culture, and overcome sector challenges.

2. Diversifying communications channels

The digital era has given rise to a paradigm shift in the way investors expect to interact with their providers. Whether via instant messaging, video conferencing or other methods, firms should be actively exploring communications channels to speak to clients. Clients enjoy the opportunity to choose the medium they’re most comfortable with.

Conducting client communications through digital channels means interaction monitoring is easier than ever before, thanks to speech recognition platforms such as Recordsure Voice. Where once advisers had to rely on hastily jotted meeting minutes or spend hours composing meeting notes, it’s now possible to have entire conversations recorded and transcribed using sophisticated AI.

With the advances in machine learning, Recordsure Voice tools provide sophisticated client interactions analysis. For example, firms can examine conversations via topics and identify areas of potential concerns or risks while substantially reducing the cost of post-meeting reviews.

3. Supercharge processes for greater compliance

Investors and regulators have never been more focused on wealth management firms’ regulatory standards, with emphasis on fair treatment, transparency and regulatory compliance.

With the tendency for firms to be squeezing the compliance budgets more than ever, automating as many manual, administrative, compliance tasks as possible is in your best interest. An introduction of powerful RegTech tools, like Recordsure Voice Analytics or Recordsure Documents Analytics, allows for quicker processes, better transparency and compliance assurance while benefiting the business, clients and keeping the regulators happy.