Major transformations are happening in the financial services industry, and firms and advisors need to try to keep pace with the changes, according to Lisa Dolly, CEO of Pershing, a BNY Mellon Company.
In some instances, the financial services profession is behind other industries in adapting, Dolly told 2,500 financial professionals attending the BNY Mellon Pershing Insite18 conference being held in Orlando on Wednesday.
In today’s world, bigger is better, she said. “Broker-dealers are adding scale in order to improve services” for firms and investors, she said, adding that this is going to be pushed even more because of the $1.7 trillion in private equity assets that are currently uninvested.
The maturity of the RIA business model is demonstrated by the fact that there are now more non-owner advisors than there are owner advisors, she said.
“This will bring an even greater concentration of assets at fewer firms,” she added.
Investment management will transform itself into financial life management, which looks at clients’ whole financial life and at life decisions, the CEO said.
“We are only at the tip of the technology revolution. Artificial intelligence will be used to predict clients' behavior and allow advisors to customize portfolios to the clients. Financial advisors are not doing well at keeping up with the digital revolution, Dolly said.
Finally, the business world as a whole is being hit by a talent shortage, reflected in the decreasing unemployment numbers,
“Our industry is worse off then others and the shortages being faced now will become much more severe in the future,” Dolly said.