Here's How WealthTech Increases. Not Diminishes, Hands-On Service

Many advisors in your firm may believe the best way to deliver personalized service to high-value clients is to be as “hands on” as possible. That often translates into spending lots of time constructing, monitoring and adjusting portfolios for important clients. While it may seem oxymoronic at first, the automation that technology provides can actually enhance the personalization and “high-touch” service that advisors want to deliver. Advisors sometimes have doubts about how easy implementing new technologies will be. Still, you can make a compelling case that the right technological solutions enable advisors to spend more time on the areas of their business where they can deliver the greatest value.

1. Hands-on portfolio oversight can be time-consuming and unnecessary, while also limiting scalability.

Technology doesn’t have to deliver cookie-cutter solutions for every client. Advisors can still set the parameters that incorporate each client’s specific investment objectives and preferences and then deliver the investment choices and allocations that are right for them. Ongoing portfolio oversight can also be achieved with checks that will adjust investments and allocations, to respond to market activity or to implement other strategies, like tax optimization, that have become essential offerings for advisory practices. Rather than remove the personal touch, technology can help improve it. Adjustments that would be difficult and time-consuming to implement manually across all client portfolios can be quickly made, as needed, with the support of the right technology platforms. Capacity management, which can be a struggle for a growing practice, can cease to be a major issue.

“Wealth managers are increasingly recognizing that to fulfill their primary role as providers of critically needed advice to all their current clients, they need a solution that enables them to offer all their services at scale,” said Woo Fung Kwong, Co-Head of the Aladdin Wealth Tech business within BlackRock Solutions. “Firms would do well to equip their advisors with technology resources that are focused on risk management, so that advisors can spend less time constructing and monitoring portfolios and more time guiding clients on broader financial planning issues."

1. The focus can shift from products to portfolios, as a whole.

Traditionally, advisors have focused on finding the right products within each asset class, and their sense, albeit one acquired from training and experience, about how each asset class interacts. Technology enables a much more sophisticated analysis, and ongoing monitoring, of how different strategies interact with each other, under multiple scenarios, and how the entire portfolio could be affected. Advisors often want to promote a “holistic” approach that takes in multiple considerations for clients. Technology can enable that with a level of detailed analysis that would be impossible for advisors to perform manually. That analysis on how portfolios should be constructed and adjusted over time can better inform advisors across a practice and deliver better outcomes for more clients.

1. Delivering true personalization becomes possible.

Today, every client wants to know they are getting solutions that will address their specific needs and align with their personal values and preferences. Delivering that across an entire client base can be extremely difficult without automated solutions that can implement and maintain those personal details once the initial parameters for each client are entered and set. The right technology will ensure that each client’s objectives and risk tolerance levels are taken into account and that the investments selected for each individual portfolio align with the client’s values. That makes the advisor’s process with each client much more powerful.

1. Time is freed to allow more direct engagement with clients.

With less time needed for portfolio management tasks and routine monitoring, advisors will have more time to engage with clients. Freeing up more hours in each week to meet in-person with clients, make calls or send emails will improve the quality of service that advisors deliver and enhance clients’ perception of the value they are getting from their advisor. Spending more time with clients can begin a virtuous cycle. Getting to know them better will enhance an advisor’s ability to understand and express their clients’ preferences and find the right solutions for them. That deeper awareness can help enhance the portfolio results delivered and improve client satisfaction. That virtuous loop of improved customer service and clients’ increasing appreciation of the quality of that service can continuously strengthen the quality of the advisor-client relationship. Happy clients are also more likely to make referrals.

1. Technology can become a revenue generator.

By freeing up time in their weekly calendars and providing better insights on clients’ portfolios, technology can help advisors deepen relationships in ways that generate more business from existing clients and members of their families. Advisors will also have more time to engage in the activities that target prospects, everything from conducting seminars and networking in the community to having a strong presence on social media and offering investor education and market perspectives through blogs, podcasts or videos. The investment in technology can quickly lead to the rewards of additional business and greater opportunities to scale by offering more services in a cost-effective way across a broader base of clients.

1. Sophisticated Technology Can Be an Advisor Recruiting Tool

Firms that employ powerful technology solutions in the right ways will be the firms for which savvy advisors want to work. There is considerable appeal to joining a firm that avoids dull and routine tasks and enables more meaningful interactions with clients and prospects. Demonstrating those capabilities will make a convincing case to the talented candidates that firms are eager to bring onboard.

A Competitive Differentiator

Advisory practices that use technology in sophisticated ways are likely to become the envy of other financial advisors in a market and the advisory firm that more clients want managing their wealth. Advisors who might have initially resisted bringing more technology into their practice probably won’t have any regrets once they do. It’s far more likely that they’ll wonder why they didn’t embrace these solutions sooner.