Financial Advice Nirvana – Part 3: Technology

David Jenkins, Matt Jeffery

Financial Advice & Technology

The way advisers interact with clients has changed markedly throughout the course of the pandemic, accelerating the demand from advice firms for greater digital capabilities and improved client engagement models. We believe this evolution is just the beginning and that the role of technology in an advice business will become increasingly important as firms look to improve the client experience, de-risk the advice process, and reduce operational cost.

We are starting to see firms use technology to create a differentiated position in the market and to significantly improve the advice value proposition. This is being supported by a range of factors including; improvements in the advice technology landscape, greater customer and adviser demand, and an evolving regulatory environment.

Creating a customer-centric, digital-first culture is paramount in designing and delivering a market leading advice proposition focused on experience and engagement.  We are seeing technology help achieve this in the following ways:

  • enabling clients to engage and interact with the end-to-end advice process
  • reducing the number of non-value add meetings with clients
  • empowering advisers with next best actions and insights at their fingertips
  • delivering automation and straight-through processing
  • removing administration from advisers and support staff
  • placing risk and compliance in the design of the model by default

Building a digital front-end and delivering significant improvements to the customer experience

First impressions count and a lengthy, labour-intensive onboarding process can set the relationship off on the wrong foot. Improvements to the front-end allow the client to engage with the end-to-end process, often without the need or input from the adviser. From video engagement platforms, gamification, and behavioural applications, to self-serve financial planning tools, the client journey can not only be engaging but educational too. The ability for customers to input or update their details, goals, and risk appetite as well as test multiple future scenarios makes them feel closer to  – and more engaged with –  the financial planning process.

Adviser/client collaboration

The ongoing collaboration between adviser and client is key to the success of the future advice model. Via digital interfaces the adviser should be able to interact with the client, creating a “multi-dimensional experience”, allowing collaborative ongoing financial planning. Video messages can be shared through a secure online messenger, forms signed via e-signature, and meetings organised via a chatbot or automated diary management system. The ability to collaborate directly within financial planning tools (e.g. cashflow forecasting software) will further smooth the advice process, reducing the required number of touchpoints and supporting faster, more informed decision-making.

Making the most of your adviser’s time

We are already seeing an increased focus on freeing up adviser time, allowing greater client and prospect face-time. Technology can facilitate this shift in multiple ways, even augmenting the advice process itself. Automating fact-finds and KYC and enabling the customer to self-serve can be fully integrated into the digital experience. The impact of this is a streamlined and efficient journey for both client and adviser.

“Technology can be an enabler, differentiator, or a complex problem to solve. Regardless, it is more critical to advice firms than ever before…”

How can technology enable these benefits?

Typically, financial advice firms have solved specific problems with point solutions, rather than having the capabilities to manage technology holistically. Prior to any technology transformation, it is critical that a clear strategic vision is established around which design principles and a technology framework can be crafted, in order to deliver a  golden source of data, multi-channel advice experience, automated processes and digital front-end.

Central to the strategy should be a practice management system that links the digital front-end with the required planning tools, portfolio management system, and adviser platform, creating a fully optimised technology stack from which the business can scale and grow.

How Can Alpha Help?

We hope you have enjoyed our series of articles on the current challenges and opportunities facing the financial advice sector. Alpha is passionate about creating positive change in the industry, helping shape future operating models and customer propositions. Please do get in touch with us here if you would like to learn more about how we can support in transforming your business.

About the Authors

David Jenkins

David is a member of Alpha’s Insurance division, supporting the Financial Advice team. David has experience in proposition development, M&A, distribution, operating model design and business transformation, working with a wide range of high-profile clients. Prior to entering consulting, David was a portfolio manager for a discretionary fund manager and led the operations for a fintech payments start-up.

Matt Jeffery

Matt is a Manager in Alpha’s Insurance division in London and helps lead the Financial Advice proposition. Matt has over seven years' experience in the investment industry, having trained as a financial adviser before moving into consulting. His background gives him a unique position to help his clients and, as a result, he has built up strong expertise across the value chain. Recently, Matt has helped his clients in projects across operating model design, supplier selection, corporate strategy, M&A, outsourcing, and product and distribution strategy.