Thoughts from Digital Integration in Wealth Management 2018

Second time's the charm

Back for it’s 2^nd year, the Digital Integration in Wealth Management conference took place last week in London, UK at the Chelsea Harbour Hotel. The two-day event, put on by the folks at Arena Financial, brought together industry thought leaders in Wealth Management. Big name firms like UBS, BNP Paribas, Barclays, Deutschebank, HSBC, Santander, etc. along with independent and boutique firms were all very well represented. The title gives it away; discussion focused on how we move digital forward. The topics were varied and interesting, covering everything from ideal composition of structured products in a digital world, to social media, to technology and strategy.

At this point, digital is just a given (thank goodness). We’re no longer trying to convince people that digital is a must –we’re focused on talking about how to move forward different areas of the business and sharing lessons learned already. The best proof of that are the job titles for folks that showed up – I’ve never seen the word “digital” in so many titles before. Overall, a good mix of executives responsible for digital strategy, marketing, compliance, product, and of course IT.

From a strategy perspective, it was great to hear from Thierry Derungs, the CDO (Chief Digital Officer) at BNP Paribas Wealth Management, on his approach to digital there. It starts with a few die-hards and it’s all about gentle but progressive disruption. Key though is executive support, right from the CEO, mandating that everyone is responsible for digital. Their approach is also very interesting. They focus on incubating initiatives in different factories. Come up with a hypothesis, pitch it, prove the value, and keep going if it makes sense. It’s a fail-fast approach that quickly validates ideas and uses agile and scrum methodologies to get iterations going. A great example was their intelligence-augmenting voice-bot that provides CSR’s and advisors with helpful data and quick action buttons based on what the caller says, so they are better equipped to quickly and correctly answer inquiries and react to information.

Several marketing folks talked about the value of content in a digital world. “Content is king,” is the key takeaway from an engagement perspective. Gone are the days of putting ads out there. To use social media, the preferred platform for targeting digital consumers, firms must engage their audience and not simply try to sell to them. How do they do that? Engaging content. Content that is insightful and speaks to customers so that they react, share, like, or hopefully comment and engage you on it. Music to my ears, of course, validating the approach we take with NexJ Publish.

We’re also getting a little more coherent and clear on the difference in digital approaches for different businesses. For the mass market, engaging savers and lowering the barrier for investing is key. Self-service and ease-of-use are certainly top concerns there. As you move up the chain, mass affluent customers still want self-service, but start to expect the ability to quickly connect with a dedicated professional they know and trust to talk things through with or simply issue orders to. Moxtra had a great example of their omni-channel engagement at Citi doing just that. At the UHNW level, they are also looking at digital mostly as an additional communication channel for their customers. The business model and value proposition there isn’t likely to change from the current tradition very much given the complexity and sophistication, but it’s more about augmentation of the relationship manager and supporting teams. The idea is to dramatically reduce administrative burden by leveraging AI to streamline everyday tasks and arm them with more insight and intelligence.

I got to present on how to take a customer-first approach to digital. Having been working with firms for the last decade on CRM and BPM implementations, I’ve seen a lot of failed approaches that I’ve had to replace. Unfortunately, nearly half of all CRM implementations fail to deliver on business objectives. That’s because they were tactical, not thinking about digital. We often see the monolith; heavily customized and bottlenecked implementations that rely on data replication and synchronization. The inevitability here is that they simply become too large and costly to maintain. Alternatively, I see a lot of siloed CRM’s where firms opt for an MDM approach to data instead and treat CRM as just a sales tool. That usually leads to it being too difficult to get data into the EDW resulting in frustrated users just keeping data elsewhere without telling you. The right method seems to be a model-driven approach to virtualizing a business domain model view of customers, abstracting the integration so that the data can remain at source. As we found out with CDAi, it also has the additional advantage of supporting the construction of an attribute-based data lake. The benefit? An ability to finally make analytics and AI a reality; key requirements for digital transformation.

Clearly this was a relatable topic – I don’t think I’ve ever been inundated with so many requests for follow-up and even just folks coming up after the presentation to engage with me on the topic. If you were there or you can relate to the topic, let me know your thoughts in the comments below or contact me to discuss further.