Hybrid Advice: Optimising Client Support in the Midst of a Crisis

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byHayfa Bukhari
Hybrid Advice

The growing pressure on advice firms to consider how best to use digital within their operating models is not new. Efforts to attract the mass market, expectations of younger investors and the need to reduce costs have all formed pressures to date. Many firms have been reluctant to adopt the technology due to uncertainties around client trust and losing relationships gained through face-to-face meetings.

 

The Covid-19 pandemic has caused a shift in the general population’s view of adopting technology within their day-to-day lives. The use of video calls and digital apps has become the new normal, used for social events and family gatherings across all generations. There has also been a growing interest in the health of savings and investments as uncertainty grows around the lasting economic impact of Covid-19.

 

The level of uncertainty around this “new normal” has forced firms to consider adapting their business models to a socially distanced society if they want to survive. There is value in drawing on ideas from firms across industries whose business models have been recognised as delivering excellent client experience prior to the pandemic and who have also been resilient to Covid-19. This is no different for advice firms and could also pose a prime opportunity to transform the advice industry and bridge the advice gap.

 

Some key areas of focus for advice firms considering a digital hybrid advice model include:

  • Opportunities to use technology to make productivity gains and reduce the cost to serve
  • Long-term impacts of responses to Covid-19 on their operating model
  • How to capitalise on technology to simplify historically complex areas such as risk and compliance

 

Firms must consider both the opportunities and risks which adopting technology such as Video Conferencing, Natural Language Processing and Artificial Intelligence can bring. The problem of generalist tools not suitable for the advice journey is no longer an issue. There has been a great amount of innovation in this space with firms such as Aveni developing solutions specifically for financial advice firms. Actions taken now will create winners and losers in the industry and it is time for advice firms who have historically relied on face-to-face client meetings to act now and create new opportunities.

 

Productivity

“Opportunity in the midst of a crisis”. We are all familiar with the saying, yet with the health, economic and social impacts of Covid-19 becoming clear, financial advisers could be forgiven for wondering what the opportunity is.

 

Almost overnight, the majority of financial advisers became digital. The widespread adoption of Video Conferencing (VC) as the primary tool for client service is a genuine gamechanger for the industry. Using VC technology can:

  • Reduce the cost to serve
  • Increase operational efficiency
  • Improve compliance and dispute resolution
  • Enable expansion beyond immediate geographies
  • Increase appeal to the next generation of wealth
  • Introduce new VC-only channels at new price points

 

Gains in productivity through adopting technology have often been offset by the increasing complexity of delivering advice due to factors such as compliance, product or client needs. This time it will be different. The widespread adoption of VC is not just a method of connecting with clients, it is an enabler of new technologies such as Machine Learning and Natural Language Processing that can deliver transformational change.

 

From VC to “VC for Advisers”

It is likely that features designed for specific industries will begin to emerge as VC solutions transition to ‘Digital Service’ solutions. Secure document sharing, digital signatures, assisted fact finds and annual reviews could be integrated into a single VC-based service proposition. It is clear that technology provides the opportunity for a seamless end-to-end digital advice journey.

 

Human+

As traditional advice models come under increasing pressure from challenger banks, Robo-advisers and digital-first solutions, the industry’s ability to adopt technology will define its future. The adoption of VC enables a wide range of Artificial Intelligence (AI) applications to augment human-delivered advice. The Human+ approach wraps technology around human interaction, whilst keeping the human at its core. AI technologies such as Natural Language Processing enable machines to understand and contribute to the advice process. AI can be used to onboard clients, automate administration, transcribe meetings, populate Client Relationship Management (CRM) systems and propose solutions. AI assistants can contribute live in meetings, offering prompts and monitoring risks (such as vulnerability) directly to the Adviser.

 

This technology and its application across financial advice is not a pipedream. Thanks to the adoption of VC, it is just around the corner. Firms such as Aveni have developed specific use cases for the financial advice industry using Artificial Intelligence, Machine Learning and Nature Language Processing to provide these opportunities in productivity.

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