The linkage between use of technology and wealth managers' performance was the theme of a panel debate at a WealthBriefing GCC Region Summit.

The world’s wealth management industry has made highly uneven use of technology as it grapples with the need to be more efficient in the face of mounting regulatory and other costs, and in the face of rising client expectations around service delivery, a conference organised by this publication has heard.

Relationship managers are still spending significant chunks of time dealing with bureaucracy and paperwork, while RMs are in some cases spending hours in preparing for client pitches – a situation that drags down their efficiency and puts more strain on the system.

These are some of the findings from the report, Help or Hindrance? The Link Between Technology Provision and Advisor Productivity, (see report in full here) that was released by the publisher of this news service earlier this year, and written by Wendy Spires, head of research at WealthBriefing. She expanded on the findings of the report at a panel discussion held in Dubai for the WealthBriefing GCC Region Summit. Sitting with her on the panel were Martin Engdal, who at the time of the event (May) was Market Strategist & Director of Business Development, EMEA (he has since left this firm and now works at SimCorp); and Siddarth Bhandari, head of investment solutions at Emirates NBD. The conference was sponsored by Advent, Dominion, smartKYC, Jersey Finance, and ProFundCom.

Spires led the audience through a number of stand-out conclusions in the report, such as 21 per cent of advisors devote upwards of two hours on preparing for an annual review meeting with an existing client; while 79 per cent spend over an hour. The situation is even worse when it comes to the time taken to prepare a proposal and pitch materials for a prospect: here, 48 per cent of advisors spend upwards of two hours on these preparations and 84 per cent spend over an hour.

She explained that RMs will give the quality – or lack thereof – of technology at firms as a reason for changing jobs. Most advisors questioned for the survey said they could only spend around 40 per cent of their time with clients, suggesting a heavy administrative workload. 

She said there are large time savings to be won because, according to the report’s findings, many advisors are spending double the time that they should have to on meeting preparations, while they are trying to juggle a big book of clients. 
“Almost half (46 per cent) of advisors have to access three or more systems to prepare for an annual client review meeting,” she told the conference.

She gave other findings, such as that 43 per cent of RMs say a significant or very significant amount of manual work is required to prepare for an annual review. Automation currently stands at such a low levels that just a tenth of advisors say they can prepare for an annual review meeting with very little manual work being required, she said.

“Client-facing time has always been of paramount importance in the wealth management industry, since it is a relationship business. But being able to spend the maximum amount of time with clients is more essential than ever today I would say. Amid the rise of robo-advisors and other low-cost options, there is a huge need to emphasise the value of tailored, one-to-one advice. However, there are two other crucial – and interlinked - factors here that are also worth mentioning,” she said.

In an age when the financial crisis has forced clients reconsider their expected returns, it becomes more necessary than ever for RMs to discuss these expectations with clients – hence the need for RMs to minimise time devoted to back-office paperwork. The need for deeper conversations also stems from how regulators are enforcing greater transparency on fees, as well as on investment performance.