Advisor Success Blog

Technology, Change, and the Industry’s Future

Jul 02, 2018

Advances in technology continue to change every aspect of our lives. Christopher Roberts and Micah McCann tell us how technology is changing our industry.



Technology and Change

By Micah McCann; Vice President, Technology

In looking back at the last few years in the financial services industry, it’s hard to ignore the amount of consolidation that’s taken place. It’s like watching the swinging silver spheres of a Newton’s cradle. The initial movement of those shiny orbs is seemingly perpetual. The momentum of broker-dealer acquisitions is similar. One can only wonder when things will slow down.

It’s not just broker-dealers that continue this consolidation trend. There has also been a significant amount of merger and acquisition (M&A) activity in the technology space. A good number of smaller software companies have been bought up by larger players looking to round out their own platform offering. A few deals worth mentioning are Envestnet’s acquisition of Yodlee, Broadridge’s acquisition of M&O (Compensation), Fidelity picking up eMoney and iPipeline buying LaserApp. It’s hard to predict the long term benefits these acquisitions will bring and what value we as an industry will glean.

What is apparent is that these combined organizations now have access to a greater amount of data. This may be stating the obvious, but it’s important to point out that the data itself was a key driver for many of these acquisitions to begin with. These companies realize that the more data they have the more they can do with it. This can lead to offering more services and positioning themselves for greater influence on industry standards. So why does this matter if you’re an advisor?

It won’t be long before these companies begin offering ways to make their data more accessible and present it in more meaningful ways. It’s becoming easier to layer on third party tools that support artificial intelligence, predictive analytics, and machine learning. Serving up quality information more frequently could raise awareness on new business opportunities. It could also enhance client engagement and improve how business operates.

Another benefit is that larger institutions tend to have more resources and are willing to dedicate them to data quality efforts. An example of this is the recent launch of data scrubbing services offered to H. Beck through Investigo. This service aims to improve accuracy of performance reports. Without the backing of Investigo’s parent, Broadridge, data scrubbing may not exist. It’s worth noting that data quality and presentation are just as important as the experience in interacting with the data.    

Several of our industry partners are beginning to recognize that the way we interact with technology is changing. Voice commands are becoming more commonplace. For example, Alexa for business is now forging its way into corporate meeting rooms for voice enabled conference calls. The intent is to create a frictionless experience where rooms can be booked and meetings can start all from a few spoken words. Although it’s far from mainstream, we are beginning to see these voice enabled tools work their way into our industry creating even more possibilities for the future.



Embracing Change to Differentiate Yourself

By Christopher Roberts; Senior Vice President, Sales Support

“Innovation is the ability to see change as an opportunity – not a threat.” – Steve Jobs

I was taught that there are three key things in the adviser-client relationship. Do they trust you? Do they like you? Do they need you? If any of these are in doubt, so is that relationship.

“Do they trust you?” That level of personal trust carried you through the distrust of the financial industry during the Financial Crisis. It should not be in doubt.

“Do they like you?” They wouldn’t be your client if they didn’t. When I was an adviser, many of my clients called me friend, or even family.

“Do they need you?” Do they?

New technology may shed a light on that.

Clients are now gaining accessibility to far more sophisticated tools without the need of an adviser. They are questioning costs and wanting more control. This pressure is causing the potential commodification of the financial industry, where fee is all that matters. That pressure is combined with clients’ expectations of lower costs and higher personal service. Where is this change taking us? It will come down to how we answer some key questions:

1.              Will technology make you better at your job, more efficient, or no longer vital? 

2.              What value do you bring to the financial planning process for a client?

3.              Can they do that on their own?

4.              Can Artificial Intelligence (AI) do it better and cheaper?

5.              Do you work only in a sales capacity?

6.              When asked the question, “Do they need you?” will they answer “No”?

When an industry undergoes a commodification process, those who can’t present value to their clients will lose those clients and eventually be swallowed up by the wave of change. Change gives everyone the opportunity to determine and articulate how they differ from others in the market.

Take time to understand what separates your practice from others. Service? Accessibility? Community?  Once you fundamentally know what makes you stand out, make sure your clients know too.

See this change as an opportunity, not a threat.



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