Digital transformation of the wealth management industry accelerated to warp speed during the pandemic. The way advisors and financial professionals work looks very different now than it did this time last year. And one thing is clear: there is no turning back

Every time clients evaluate you and your business, the goal posts keep shifting, as technology innovators like Amazon, Google and Netflix continue refining the meaning of the “user experience.” The question is not when advisors and financial professionals will change—but how they can adapt to ensure they’re not left behind. The decision we made more than a decade ago to begin our digital transformation has proven that technology is our ally.

Insights To Guide Your Digital Transformation
Technology helps us better understand the needs of financial professionals and the clients they serve. We use it to provide real-time personalization at every touchpoint along their journey, to improve their experience and meet their needs more quickly. It provides a continuous feedback loop, so that with every interaction, we never stop learning more and digging deeper. And technology helps drive targeted product innovation, with more simplicity, greater transparency and lower costs that we can pass along to financial professionals—and ultimately to their clients.

Whether you’re with a wirehouse, broker dealer or independent, these insights based on our track record of innovation can help guide your firm’s digital transformation.

What’s New With The Wires?
Wirehouse advisors have successfully maintained the highest rates of productivity in the industry—124% more productive than the average financial professional, according to The Cerulli Report—U.S. Broker/Dealer Marketplace 2020. Cerulli attributes this largely to the wires’ focus on more affluent investors—and by their investments in technology.

Wirehouses are leveraging the advantage of scale and the power of integration when developing new technology, according to Cerulli. A recent example is Merrill’s new advisory platform, the Client Engagement Workstation. Launched late last year, it integrates artificial intelligence, a custom-built web browser, real-time data feeds and account servicing tools into a single dashboard, to allow management across banking and brokerage.

Tech integration is key on the product front as well. For example, we partnered this year with J.P. Morgan on J.P. Morgan Multi-Asset Choice. This innovative annuity solution combines a professionally managed tailored portfolio with tax-efficient investment options—all fully integrated into J.P. Morgan’s advisory platform to allow for more holistic management across taxable accounts and tax-deferred annuities.

What’s Working For The Independents?
When it comes to leveraging technology, wires and broker dealers have the advantage of size and scale. Independent advisors have the advantage of choice and flexibility.

As the independent channel continues growing, more fin tech providers are stepping up to support them, from the front-end to the back office. This includes customer relationship management (CRM) solutions like Salesforce, financial planning solutions such as MoneyGuidePro and eMoney, and performance reporting such as Black Diamond and Envestnet Tamarac. 

Some larger independent firms may have the scale and resources to build their own advisory platforms and integrate directly with these third-party fin tech solutions. Other independents may rely on custodians like Schwab and Fidelity, or aggregators like HighTower and Dynasty, for a turnkey platform with open architecture that allows them to plug and play fin tech solutions as needed. Meanwhile, more product providers like Nationwide have committed to building the pipes that feed data directly into these advisory platforms and third-party solutions.

The Customer Is The Center Of Everything
One of the most important lessons we’ve learned in our digital transformation is that a relentless focus on the customer should be at the heart of everything you do. Understanding clients’ needs and meeting their demands is key. The goal is to offer your clients a digital experience that is hyper-targeted, highly personalized and omni-channel, with self-service options, 24/7/365.

Providing a digital experience for clients was among the top priorities for advisors and financial professionals to pivot their practice in response to the pandemic, according to our sixth annual Advisor Authority study. And serving clients remotely was the number one way that they would use technology to better meet clients’ needs. It’s not just for right now and not just for current clients. A digital experience that puts clients first will also help you attract the next generation of clients and retain clients’ heirs as inter-generational wealth changes hands.  

AI And Analytics Can Drive Deeper Insights
Artificial Intelligence and advanced analytics already fuel numerous robo advisory solutions like SoFi, Betterment and Wealthfront, which can be used to optimize portfolios. AI drives solutions such as Riskalize and Vise, which are used to help mitigate market risk.

But the real future of digital transformation is embedding AI and advanced analytics directly into your own practice. In fact, AI and advanced analytics were among the top five solutions that advisors and financial professionals were most interested in integrating into their practice, according to Advisor Authority.

By using the power of AI, every interaction with a client, every email or LinkedIn post they open, every visit they make to your website, creates new data points along a continuous feedback loop. This can be used to predict the best next steps and create a more personalized path, for more meaningful client connections. And as more data is added, AI will get “smarter” at every step along the way.

It’s In The Cloud
To truly scale your use of AI and advanced analytics across your operations requires managing your clients’ data to ensure that it is accurate, current and consistent—as well as ensuring it remains private and secure.

You’ll need the right CRM. And you’ll need the cloud, for its capacity to store, manage and protect the data you’ve collected within your own firm, and the data you rely on from product providers and other third-party sources. For a growing number of advisors and financial professionals, cloud-based platforms will continue replacing many legacy systems to support agile innovation and rapid growth.

Engaging And Empowering Employees
We have also learned that when we give our associates the most efficient and scalable technology, it empowers them to solve complex problems, provide better service and put more focus on meeting the needs of financial professionals—so that financial professionals can focus on meeting the needs of their clients.

In this same way, the right technology can help you and your firm improve decision-making, productivity and collaboration. It can empower you and your team to solve complex challenges and develop specialized expertise. It can automate routine tasks and free up time for more high value activities. Digital transformation also means instilling an “innovation culture” among your employees at every level of your firm and investing in their development and upskilling.

Re-Tooling For A 24/7/365 World
Even after all of the adaptations and innovations made last year, many wealth management firms are re-thinking their strategic priorities and re-tooling their practices for a 24/7/365 world. Change continues and the digital transformation of our industry has a long way to go. Now the stakes are getting higher. Because it’s not just other advisors and financial professionals competing for your clients. It also tech leaders like Amazon and Google who are looking for ways to capture a share of their wallet and a portion of their investment portfolio. So, are you going to race against the machine—or run with it?

Craig Hawley is head of Nationwide’s annuity distribution.