Challenges and Opportunities with the Digitalization of Wealth Management Revealed

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  • 68% of wealth managers say learning about and keeping up with new technology is the top challenge they face

  • 69% are concerned about staying relevant to a younger generation of investors

  • 72% see artificial intelligence as an opportunity

Challenges and Opportunities with the Digitalization of Wealth Management Revealed

Building on its commitment to help connect and empower the global financial community by harnessing proprietary data and analytics designed to add greater client value, Thomson Reuters today announced the findings of its Digitalization of Wealth Management report 2018 in collaboration with Forbes Insights. According to the survey, key factors defining today’s wealth management industry include keeping up with new technology, staying relevant to the next generation of investors and finding ways to integrate artificial intelligence (AI) into investment decision making as well as into the client-service process.

In order to better understand how wealth managers are using data and technology to adapt to changing client expectations, Thomson Reuters and Forbes Insights surveyed 200 wealth managers from North America, Europe and Asia Pacific.  Key findings of the survey include:

  • 68% say learning about and keeping up with new technology is the top challenge they face
  • 69% are concerned about staying relevant to a younger generation of investors
  • 41% say advanced analytics and cognitive technologies will have the greatest impact on the wealth management industry over the next three years
  • Only 27% currently have and are happy with their mobile platform, even though they believe this is the digital capability that clients value most
  • 65% spend most of their time on client acquisition and onboarding, followed closely by providing advice, and client objectives and risk tolerance. Many believe technology can help them become more efficient with each of these tasks
  • 72% see AI as an opportunity

“There is no doubt that wealth management firms and their advisors are now at a turning point, and have a great opportunity to reinvent themselves in order to both deliver an exceptional digital experience for the digital natives as well as to define a new generation of high touch services,” said David Akellian, managing director and global head of Wealth Management at Thomson Reuters. “The industry challenge and the opportunity, is helping ensure that wealth firms and their advisors are better equipped with the AI, advanced analytics, insight and technology necessary to meet their clients rapidly evolving investment and service needs.” 

The report further notes that the role of the financial advisor could change dramatically in the next few years. Not only will many clients expect better tools of engagement, but advisors will likely be serving even more clients and for lower fees. They will want to “know” their clients with the speed and precision of machine learning. With trillions of dollars’ worth of managed assets at stake, advisors are clear about what they need from their technology going forward: Access to client information on one screen, prioritized for current events; Meaningful personalized advice at their fingertips or for their clients directly; Automation to free advisors to spend more time with clients; Communication tools for the next generation; and augmented decision-making capabilities for advisors and their clients.

Data in the Thomson Reuters Digitalization of Wealth Management report is based on a survey of 200 wealth managers conducted during September through November 2017 by Forbes Insights. All executives surveyed are directly involved in wealth management and work for a broad range of firms, including wealth management firms, asset-management firms, investment banks, private banks, family offices, online-only firms and independent wealth management firms. Three regions are represented in the survey in nearly equal proportions, with 30% from Asia Pacific (including 9% from Australia), 30% from North America and 40% from Europe. Executives surveyed work at firms that manage assets of at least $1 billion, but the majority work at firms with assets under management of at least $10 billion, with 44% coming from firms that manage more than $100 billion.

The full report of Digitalization of Wealth Management can be found here.

Thomson Reuters is the world’s leading source of news and information for professional markets. Our customers rely on us to deliver the intelligence, technology and expertise they need to find trusted answers. The business has operated in more than 100 countries for more than 100 years. Thomson Reuters shares are listed on the Toronto and New York Stock Exchanges.

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