Equator’s Garry Hamilton on solving wealth management’s tech puzzle

by | Feb 21, 2023

It’s an exciting time to be a wealth manager, with $80tn in new wealth set to be created over the next five years, according to Boston Consulting Group.

Yet such an explosion of opportunity could quickly become a double-edged sword for the sector unless it gets the right technology to give clients the support they desire and deserve.

Many wealth managers know digitizing their operations will be the only way to provide a brilliant, flexible service, and they are already investing in platforms they believe are capable of coping with the forthcoming flood of finance.

But is this a true transformation or just a digital sticking plaster? To answer this fundamental question – one which will determine whether wealth managers have a successful or stuttering future – firms must strike a balance between delivering a better experience and improving efficiency.

That entails shining the spotlight on digitization strategy and four factors in particular.

Four foundational pillars of transformation

Firms must first understand digital transformation in determining whether they are transforming for experience or efficiency. Many have started their journey, with efforts accelerated by the effects of the pandemic. But how far along their digital transformation journey are established wealth managers?

While 88% of respondents in one study believe greater adoption of new technologies will significantly impact the industry’s evolution, there is a gap between knowing something is needed and being happy with the results. Nearly half (46%) of respondents to a separate survey reported they were only ‘partly satisfied’ or ‘not at all satisfied’ with their current digital offerings.

Part of the challenge is understanding what ‘being digital’ means. Simply investing in and deploying specific software is digital transformation for some firms. While those tools certainly deliver capabilities and functionality that enable firms to operate more agilely, that mindset overlooks the significant work required to become truly digital.

It is also important to remember that these solutions are available to everyone. To differentiate from the competition, wealth management firms need to find ways to use the features available in those platforms, integrate them with their other technology, and then use the resulting services to empower users.

Getting to that point requires more than bolting tech together. Irrespective of industry, four factors influence digital transformation: process, data, technology and people:

  • Process – Wealth management firms that become fixated on replacing systems with new technology while overlooking their processes are not alone; many companies in various industries are guilty of similar behaviour. It creates a situation where processes designed to work with the old technical system remain in place, even though they no longer suit the new system. This leads to frustrations with the latest technology and low adoption rates. In truth, there is no immediate solution. Instead, the importance of this aspect must be registered, and all processes – official and unofficial – must be identified into discovery and learning sessions that identify what users need from the transformation.


  • Data – The importance of data to wealth management firms has been talked up for some time; we are now reaching a point where that data is usable, and firms are starting to realize the potential of having access to real-time insights. The establishment of a data-driven approach is the foundation of any transformation. Once in place, the services designed to drive efficiency and experience excellence can be delivered. These will typically be designed around initial findings and represent, to a certain extent, a hypothetical view of what success looks like. This implementation is continually reviewed and evolved to enhance effectiveness and improve the offering as it learns about their behaviours. But this is only the first step. As organizations mature, they integrate automation, freeing up teams to focus on more complex problem-solving by taking on standard tasks and roles.


  • Technology – Having the appropriate tech in place is non-negotiable. Clients expect seamless interactions powered by the latest technology. The right technology stack can and should be tailored to specific business goals and even to the requirements of smaller units within the organization. Regulators’ view of digital tools is evolving, allowing established firms to deploy the same sort of technology that their fintech competitors are using. This helps firms realize significant efficiency gains and provides a foundation for driving experience innovation. It empowers wealth managers to transform continually and future-proof themselves against new disruptions and market changes.


  • People – Digitisation’s value must be sold to clients and employees. Users’ wants and needs are changing, which carries over into the justification of transformation: what’s in it for them? Is it an enhanced experience, a better way of working, a cheaper service, or a faster resolution? People are the baseline of success in digital transformation. If the product or service is not used, it cannot be considered a success. The only way to ensure this is to know what people or users need and how they need it. No matter the target audience, this is not a simple exercise. It invariably involves a significant change from the top down. Once this progresses to implementation, change management training, collaboration and future support are critical workstreams alongside the service design.


Finding experience-efficiency equilibrium

For wealth managers to tackle ongoing disruption in the form of changing expectations, market turmoil and revolutionary innovation, they know they must transform. Many are advanced in their journey yet still struggle to achieve the necessary balance between efficiency and experience.

They can now do all sorts of data capture, measurement and analytics alongside technology-enabled efficiency. Still, they will struggle to get the balance right if they’re not focusing on what their clients want.

It’s about the level of efficiency and experience right for that specific action. Sometimes you can have too much experience, which gets in the way of completing a simple task. At the same time, a process can be too efficient without much experience, and clients are left nonplussed. No one-size-fits-all approach exists, even within specific client services, and wealth managers must adapt accordingly.

Using the right processes and technology to create an agile business structure is fundamental. For it to be valuable, it must be combined with an ability to listen to, learn from, and react rapidly and effectively to audience requirements.

Only by doing so will wealth management firms be able to get the balance right between delivering efficiency and experience and continue evolving to stay ahead of the competition.

By Garry Hamilton, Chief Growth Officer and Founder, Equator

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