A Roadmap to Digitize your Wealth Management Practice

By Valuefy

February 12, 2019


Traditional Wealth Management firms can vastly benefit from partnering with new Fintech kids on the block to digitize their offerings. A well-implemented partnership can bring with it a host of benefits including uplift in the bottom line, saved time, saved costs and an increase in customer penetration.

As the wealth management landscape is undergoing a sea change, with people choosing to go the DIY route through Robo Advisors and Passive investing, it has become imperative for traditional firms to make the switch to digital. If you’re thinking of digitizing your practice here’s a quick 5 step guide to consider before placing your bets.

Clearly establish the goals of digitization:

What is the problem statement and what exactly are you looking to acheive. Are you looking to save time spent on operational tasks? Are you looking to increase efficiency and client loads per relationship manager? Are you looking to reduce costs? Are you looking at improving customer satisfaction with digital offerings? Benchmarking this data before and after the exercise will help you measure your degree of success.

Consider the ripple effects on people and processes:

For your digitization strategy to be successful, it must consider the impact of transformation on company culture and on people and process. Are your wealth managers ready to adopt technology? Are they willing to take time to unlearn existing practices? It’s essential that transformation doesn’t result in parallel processes due to a lack of trust or usability of the adopted tools.

Assess and prioritize:

Don’t bite off more than you can chew, prioritize your goals and identify short, medium, and long term milestones. Eg a 5% improvement in manager productivity in the first 6 months or a 3% reduction in costs in the first month. Proper prioritization by key stakeholders will trickle down to the rest of the team and reduce apprehensions about the transformation.

Develop a clear timeline:

Building up your digital capabilities isn’t a one-time thing. Allocating the resources, getting the organization on board, outlining the investments is a continuous process. It helps to have a clear horizon of when each step needs to be taken. Develop a high-level plan and define the key architecture of changes to be implemented. Some key questions should be answered in consensus to avoid miscommunications later on. Should you partner with a Fintech or develop an in-house solution?  Should the focus be on the web or on the app? Should there be a one time launch or an iterative process? Should you buy a readymade solution or develop a customized one?

Make the move:

Once you’ve made the decision to digitize your practice, developed a consensus and defined your roadmap, it is essential to act to get the ball rolling. Large organizations especially those in traditional sectors such as Wealth Management and Banking can be notoriously prone to inertia and resistant to change. Once you have your key stakeholders on board, make your first step soon to avoid digitization plans being shifted to the next quarter to accommodate immediate concerns and short term goals.

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