Doug Fritz, founder and CEO of F2 Strategy, is a former wealth management executive who decided to create his own partner for strategy consulting, F2 Strategy. It provides consulting services globally to support existing technology teams and marketing departments within the wealth management, family office, RIA, and wealth manager space. F2 Strategy recently partnered with MyVest to research discretionary portfolio management programs, unveiling how broker-dealers, banks and wirehouses can respond to the tension between advisor customization and firm-level portfolio control.

How have the client and advisor’s roles changed during the digital transformation?

Surprisingly little so far. People still need people to help them out, and robotics, direct to tech, and chatbots have not made any material dent into the expectations of clients. What has changed is the expectations for reduced friction—and even what constitutes friction has changed.

What is the main criterion that shows whether a company would be successful when implementing technology or not? How can you know whether or not the company can succeed in their tech transformation?

We spend nearly all of our time at F2 Strategy helping clients make great decisions about the tools they need and teaching them how to implement them successfully. By far, the most important factor in success has been how closely does the tool or capability align with the core of what that firm does and what clients/advisors expect the firm to be great at. When firms select technology, which amplifies the already established and inculcated value proposition: Advisors and Clients rally toward it. When firms try to change culture, behavior, or value propositions with technology, they almost always face steep challenges.

The success of a digitally transformed company is based on the ability to find and grow the right clients. How has digital transformation changed the ideal client profile of wealth management companies?

Not a lot. Even with fast-growing companies, the majority of the focus has been on serving the clients they already have. Despite the rancor, none of our clients have materially seen a shift in client profile from the great impending wealth transfer. However, we have seen clients who have had significant success in refining their marketing and experience around specific client profiles and needs. It’s one of the most daunting challenges that our clients face: How to say “no” to the wrong client. Much respect for those who really take this on and follow through on it!

Advisory firm growth is also defined by its ability to scale. From your experience, can you describe a model that won’t scale well? What should be done to fix it?

Eesh. I think all advisory models can scale but would need to do so differently. For example, planful advisory firms can scale themselves with the help of client-plan-interaction. Tools such as eMoney that allow the client and advisor to partner on the plan can be configured to keep the plan “central” but also allow advisors to take on more clients.

What is more important for a wealth management company that wants to grow, sales or service? How can one find a balance between the two?

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