Technology
How Tech Changes Role Of Wealth Advisors - JHC
More coverage on the digital disruption in wealth management and where it is bringing most benefit.
Andrew Watson, who earlier this month stepped into the newly-created post of chief product officer at UK wealthtech provider JHC, spoke to WealthBriefing about how he sees technology changing the role of advisors and what kind of tools they should be making a priority. The interview continues our series on the transforming (sometimes disruptive) effects of digital on wealth managers. (The publication's editor and CEO also discuss the issues here in a recent video.)
What specific examples can you give of where technology
is having the most impact and where firms need to be doing
more?
Firms need the right technology not only to help win business by
improving customer engagement, but also to give them the scale
and capacity to do this while continuing to offer high value,
personalised services that deliver the best investment outcomes.
But it's important that the back-office is not overlooked. It's
crucial that firms have technology in place to enhance day-to-day
processes in order to increase efficiency and reduce operational
cost.
Of all the changes wrought by tech, what’s been the most
significant change to how advisors work?
Digital allows advisors to illustrate investments in an engaging
way. We're very excited by ESG and how this can be used as a
client engagement tool by giving advisors more opportunities to
understand the customers' needs and provide investments that
reflect customer values. The challenge here is meaningful data,
but that's a problem that is being solved and technology has a
big part in aggregating the data and using it in a meaningful way
to inform customers and help investment managers make better
decisions.
A big debate recently has been whether tech such as
artificial intelligence is going to either replace people or make
them more effective, or possibly a bit of both. What in your view
is the likely outcome?
Increased use of digital to engage with clients is imperative,
but it is most effective when delivered with a human touch and
used to support face-to-face interactions with advisors. I do
expect to see more gradual growth in automated advice but this
continues to be slow as people will continue to want advice from
people they can trust when investing for their future. We are
seeing a role for AI when it comes to analysing data and helping
investment managers optimise portfolios for risk, return and
(coming soon) ESG.
Do you see different levels of tech adoption by advisors
of varying ages and backgrounds? Have you seen any specific
trends?
We're definitely seeing increased adoption of digital technology
such as client portals even amongst our older, more conservative
clients. This will help our clients drive down costs by taking
care of lower value activities such as sending documents and
updating details.
In five or ten years’ time, in what ways do you think the
role of advisors will have changed and to what extent will tech
be the reason for that?
In 5 years' time, there will still be a demand for advisors out
in the field as people will still want peace of mind and someone
they trust when investing. However, the advisors will need the
right technology in order to be able to better illustrate the
customers' state of affairs and, when required, provide real
insight into the make up of the investments.