Tomorrow’s leading wealth managers will be those that focus on delivering excellent client service. Doing this requires major strategic shifts and investment, as well as operational and cultural changes.

Within wealth management, all is booming. Rapid growth of personal wealth is fuelling fast expansion in assets under management, and profits for wealth managers. To us, it is clear that wealth management is evolving. Tomorrow’s leading wealth managers will be those that focus on delivering excellent client service. Doing this requires major strategic shifts and investment, as well as operational and cultural changes. It will not be easy, but those that succeed will reap the rewards offered by market growth. Our recent 2007 Global Private Banking/Wealth Management Survey (available on our website, www.pwc.com) published last June, revealed a contrasting picture of growth and challenges. Chief executive officers were predicting the highest annual growth in assets seen in the survey’s 14-year history – a staggering 30 per cent. At the same time, the challenges of managing growth surfaced again and again. The survey highlighted the changing shape of wealth management. The participation of 265 organisations across 43 countries is evidence of the global explosion of wealth management. Participants came not only from the established markets of the Americas and Western Europe, but also in large numbers from Eastern Europe and countries such as India and Singapore. The number of private clients overall is increasing as a result of the accelerating economies of these new nations, as well as sustained growth in established markets. New clients to wealth management are dominated by entrepreneurs who have built private businesses, representing a fundamental shift from traditional inherited wealth to self-made wealth. Today’s clients understand business, know what they want and expect to get professional service at competitive, institutional costs. Those wealth managers who deliver these clients what they want will become tomorrow’s leaders. Supporting growth and dealing with the related issues are now the key challenges facing our industry. Are wealth managers able to manage exceptional growth without compromising an excellent client experience? For an industry that is seeking to become more client-centric, wealth managers need to change their business models in response to changing demands. A gap is appearing to emerge between those wealth managers taking actions to prepare for a new world, and those not doing so. Our further analysis explores the building blocks on which wealth managers need to focus – clients, people, technology, strategy and the internal organisation - if they are to emerge as one of tomorrow’s elite. As yet, few have succeeded in implementing these changes throughout their organisations, and this remains their challenge. At a time of rapid asset growth it is all too easy to delay tackling the challenges revealed by our survey. Indeed, our research suggests that while some are investing for the long term, others are not. Such is the magnitude of change required that implementing it is a long-term journey. The danger is that by failing to change, some wealth managers fall behind, becoming firmly consigned to the sector’s second division. We believe this to be a formative time in the history of wealth management. The sector’s first division of tomorrow will emerge from those that invest some of today’s profits for the future.