[The key to business success — especially in a hyper-competitive operating environment driven by accelerating rates of change like ours — relies on strategies that are built firmly around and stay very close to your clients. Changing investment options, service delivery systems, client engagement tools, and enhancements to holistic advice are altering the way consumers look at financial services and their expectations of wealth management advisors and firms. This opens up great competitive opportunities, but they must be forged by truly being client-driven. The history of successful business model innovation demonstrates how to innovate from your clients, not just from a corner office vision.
In order to do so, you need to speak openly with your clients and studiously leverage that first-hand knowledge with relevant ongoing client research being done on your marketplace. Only from this informed reality can you know the solid steps you need to take towards reinventing your firm, transforming your operations, and fine-tuning your business model innovation efforts. Understanding changing client needs and new operating dynamics can help guide you in developing a strategic road map and the best next steps for competitive positioning and deep client engagement.
One great source of Wealth Management industry research is provided by Accenture — a global professional services company that provides a wide range of end-to-end business services and solutions with five main practice areas in strategy, consulting, digital, technology and operations across 40 industry sectors. They work “driving change globally” and “helping clients create their futures” supported by their global network of Advanced Technology and Intelligent Operations centers.
An Accenture Wealth management consumer study entitled Wealth Management: The new state of advice spotlights the rise of newly engaged investors with growing financial advice needs and wants. The Study reports that investors want holistic advice that moves beyond just investments and is delivered within the right context of a client's financial, emotional, and social goals. It also clearly shows that financial firms need a robust digital and personal engagement business model that is powered by analytics to deliver against clients’ changing expectations.
We reached out to Scott Reddel, global wealth management practice lead at Accenture, to learn more about their research activities in wealth management, the changing dynamics around “advice” in the industry and the three trends they have identified that will most greatly shape the industry in 2024 — longevity, generative AI and the changing advisor workforce. Scott shares his real-world industry perspective based on his work with leading financial firms and advisors and his firm’s extensive research on global wealth management trends.]
Bill Hortz: Can you explain the range and depth of the work that Accenture does in the Wealth Management area? What kind of research and activities does your firm perform in this space?
Scott Reddel: Accenture is a massive business consulting and solutions firm that has an extensive global and cross-industry perspective on change and change management. I run our wealth management area globally within our Capital Markets group and, for us, Wealth Management is really about “advice” as a horizontal across financial services. We span the range of traditional wealth managers, defined contribution, benefit providers, banks, insurers, all these types of firms that provide financial advice. That is the focus of my area.
Typically, our sweet spot, in terms of the work we do, is really about driving transformation and increasing business reinvention. Key topics we cover include how digital transformation is enabling more capabilities for advisors, but increasingly we are covering how do you reinvent your business model to deliver different types of advice, monetize that, and so forth. We use our research to really help drive and accelerate that change.
Our research activities include doing periodic surveys with advisors and their clients. Advisor surveys look at what advisors want and need from “advice” delivery and capability enablement. I would say increasingly we are doing a lot of work and research around generative AI and what is the role of AI for advisors because of the demand there, but then also looking at the ecosystem and our ecosystem partners (be it technology firms, product firms, other innovations) and examine how they are being used and applied to the industry.
Hortz: Do you openly share any of your wealth management industry research and where is it accessible?
Reddel: We maintain a public Capital Markets blog site where we post a great deal of our research. We also push out research on LinkedIn as well, so our research is readily available for industry leaders and wealth managers to use in their planning and strategy development.
We do our own primary research but we also have a set of research partners. As an example, with the World Economic Forum, we run their Future of Capital Market series among a number of ongoing research with them like just publishing a paper on the Broadening Access to Private Markets. We also have a relationship with University of Chicago Booth and a couple of other academic institutions where that research is not always on our website, but we will push it out in different forums based on the topics being explored there.