People power: wealth management’s most valuable commodity and how technology is holding it back

While one of the surprising consequences of working from home has been the time saved through limited travel, relationship managers are still bogged down in admin. Asked to name the biggest drain on their time, compliance comes out top, accounting for 18% of a relationship manager’s day – and 75% stated this was too much for their liking.

The relationship managers we spoke to were unanimous that clients were the key motivation in their day-to-day roles, and client management consumes up to 27% of their day. But underlying admin remains a drain on their resources: preparing for meetings consumes an average of 1.6 hours while writing up notes afterwards takes 1.3 hours. This is not surprising, said Compeer’s James Brown. “Firms need to think carefully about administration. Look at data, for example. It’s important to make use of support resources so that data entry is placed elsewhere – this will then free relationship managers up to focus on clients and their underlying portfolios.”

In spite of the challenges that have arisen over the last 18 months, it was clear from the research that growth remains a continued priority for advisory firms. Relationship managers told us that many of their firms still have growth targets of close to 10%, with a large group with targets of 11-25% over the next 12 months. But achieving these will be no mean feat. As Gary pointed out, “The great transfer of wealth is imminent: as much as $15 trillion will be transferred to the next generation over the next 10 years. There’s no reason for younger clients to necessarily have to go to the same wealth management provider as their parents, and one major issue is that wealth managers barely communicate with them because a lack of resources and natural inclination to focus on the wealth holders themselves.”

James agreed. “There needs to be a major step up with digital. One of the good things that’s come out of this pandemic is that firms are increasingly embracing digital services, and they’re seeing that performances have been particularly good, and there are still steady inflows. And while we’ve seen an encouraging increase in reaching this demographic through targeted seminars, for example, they need to be aware that they can’t expect the same levels of loyalty from the next generation that they’re used to.”

Onboarding appears to be a steadfast obstacle: a staggering 69% of relationship managers reported that it takes a week to successfully onboard clients. Just 2% work with fully automated onboarding systems and 19% say their firm has yet to automate any element of this vital process, so there’s still plenty of work that can be done to build a firm foundation when it really matters.

And in an industry that pivots on client relationships, that’s vital. Wealth Dynamix’s Gary Linieres said it’s a widespread issue impeding productivity across the board. “It actually stems from the underlying technology within firms themselves,” he said. “The key is to ensure that prospecting and managing potential new business is aligned with client onboarding processes and eventual client relationships. Firms need to consider how they’re disseminating the underlying information to senior management and the regulatory officers within their business, to ensure a truly cohesive approach. If we can get that, the industry, I hope will be a happier place.”

Once onboarding is complete, it seems the pain for wealth managers is far from over. The relationship managers we spoke to frequently called out poor systems as one of the least enjoyable factors within their work, and over half (54%) stated that they do not have access to a CLM (client lifecycle management) or CRM system. Of those who had such a system in place, 38% were dissatisfied with it, and 48% neutral – which could well suggest a lack of confidence in those available across the market itself. And as James and Gary agreed, even if a firm has made due investment in technology, installing it is not enough.

“Market players need to deploy technology the right way to really make a difference. All too often, we see wealth managers buying into a lift-and-shift or a bolt-on CRM solution, which can be more problematic than not having the technology in the first place,” Gary said. “As we always tell our clients, you can’t simply digitise a manual process and expect it to be more efficient. The key is to streamline a process, and then digitise it. Doing this could be all it takes to give wealth managers the edge they need in a fast-moving and competitive market.”

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