Despite uncertainty and upheaval over the past 18 months, the wealth management industry has remained resilient. Many firms used the pandemic and sudden shift to remote working as a wake-up call to improve both employee and client digital offerings. These firms have upgraded their outdated, manual processes or software with modern, automated solutions to maintain their competitive advantage.

But as the pandemic wanes (thankfully), wealth management CEOs are looking to the future. The road ahead is paved with many unknowns. Perhaps the most important question is which capabilities and offerings will determine the success or failure wealth management enterprises. The Boston Consulting Group’s 20th edition Global Wealth report provides an outlook for the future based on what today’s firms need to be successful tomorrow.

The Landscape of Wealth Management is Changing… Again

The wealth management industry has survived numerous economic crises and digital upheavals over the past 20 years. However, the COVID-19 pandemic is the industry’s biggest challenge yet. With unemployment records finally pulling away from all-time highs and many global economies fiercely fighting off recession, financial leaders are concerned for future success.

To ensure wealth management CEOs successfully navigate the myriad of complex choices, BCG has created a Wealth Management CEO Agenda for industry leaders. These recommendations are divided into near-term actions that address immediate demands COVID-19 and provide funds for the future, medium-term actions that increase future competitive advantage, and foundational capability building critical for long-term success. This CEO Agenda centers around three main focuses: Protect the Bottom Line, Win the Future and Build Capabilities.

Protect the Bottom Line

Addressing the immediate demands of COVID-19 starts with keeping revenue on the table. Today’s firms must focus on smart revenue uplift, particularly onboarding, sales, and enablement, and optimizing the front office setup.

Firms that rely on ad-hoc responses to compliance and risk management processes must quickly identify where these tasks can be standardized, streamlined, or fully automated. Wealth management leaders who achieve this not only reduce costs but also improve customer satisfaction and organizational resilience.

Finally, firms must optimize end-to-end processes, streamline management and matrix structures, and embed agile working processes beyond IT teams to improve structural efficiency.

Win the Future

Given the change the industry has seen in the last 20 years, leaders must prepare for additional disruptive industry changes. BCG recommends firms focus on the following areas to remain surefooted in an increasingly crowded and competitive market while delivering exceptional client value:


Build Capabilities

To execute the above agenda, firms must refocus efforts on strengthening the foundational capabilities. The following are those BCG deems most important for long-term success:


There’s Money in the New Wave of Wealth Management

While the long-term impact of COVID-19 on wealth management firms remains unclear, wealth management firms must rise to the challenge.

Leaders and executives must position themselves and their firms for future success by refocusing and reinventing business and client processes, investing in smarter digital tools, and strengthening foundational capabilities. With this focus, their wealth management firms will be fully prepared to face the future’s unknowns.

Ryan George is the Chief Marketing Officer at Docupace. He is responsible for the company’s brand awareness, early-stage sales pipeline, content strategies, customer and industry insights, internal and external communications, design, and events. George actively engages in leadership roles in both the financial services and marketing communications communities. He a member of the Forbes Communications Council, an invitation-only, fee-based organization of senior-level communications and public relations executives, the CMO Council and the CMO Club.

Wealth management firms are increasingly expected to adopt and expand their digital offerings. But, the pace of innovation and the vast selection of tools and platforms available can be overwhelming, and some RIAs fear picking the wrong tool or missing out on the right one – the industry’s definitely under attack from the FOMO monster.

With the dazzling array of options, how can RIAs be sure they’re giving clients the experience they want, include the services sure to draw in younger investors, and still manage their technology budgets? Here’s how to choose the right technology and deliver the best experience for potential clients: Automation, Integration and Collaboration.

Increase Efficiency with Automation

Every RIA has tasks that are good candidates for automation. Whether it’s new client onboarding, compliance, or reporting, finding the right technology to automate these processes allows RIAs to scale and grow their business, increase their efficiency, and provide a consistent result every time.

Documenting the pain points in your business is the first step to making sure you pick software or technology that will actually solve your biggest problems. A list of features can only get you so far; seeing the benefits of how a platform or solution can function in your specific use cases is worth its weight in gold.

Technologies like robotic process automation (RPA), when deployed in conjunction with a strategic plan, measurable business goals, and buy-in and consensus from stakeholders, can be a way to make big gains in technology quickly.

Build a Better Tech Stack with Integration

One of the biggest challenges for wealth management firms and other financial services industries just getting into expanding their tech footprint is ensuring that the tools they choose integrate with their existing system contribute to their overall picture instead of fracture or piecemeal their reporting and automation. In an InvestmentNews study, 58% of firms reported that a lack of integration between core software applications was one of their biggest pain points or hurdles in technology processes.

Integrated systems ensure that information can be entered once and automatically update and flow into other systems and applications. Updates to CRMs are automatically populated in customer portals and reporting, allowing both the client and the advisor to have the most up-to-date information at all times.

Removing the manual efforts of syncing and reconciling fractured systems frees up advisors to work on the client-facing activities that matter to their business. In a report from Envestnet, they note that these technologies not only save time, they also bring in new markets, “Advisors leveraging these technologies have been able to lower their account minimums to open the market to work with emerging investors (while maintaining profitability) due to efficiencies gained from an integrated platform.”

As RIAs clientele continues to shift, meeting their expectations with digital tools will be essential.

Reaching a New, More Diverse Market

Younger, more diverse investors are looking for advisors that can provide the type of high-quality, personalized experience they’ve come to expect from their B2C transactions. Digital tools that offer investment education, robust on-demand reporting, and easy communication tools allow these investors to feel bought in to their wealth management plan. It also builds trust and provides a unique, collaborative experience.

For many RIAs, building a technology stack from scratch isn’t feasible. Choosing the right technology partners and vendors is a critical decision that can make or break prospecting, client retention, and efficiency in a wealth management firm. To meet these challenges, RIAs should seek out integrated, tested, and proven tools that work with their specific businesses and needs. Incorporating digital tools and digital transformation is a journey, not a one-and-done step. With the right partners and expertise to guide technology decisions, RIAs can continue to provide the value and experience their clients expect for years to come.


Ryan George is the Chief Marketing Officer at Docupace. He is responsible for the company’s brand awareness, early-stage sales pipeline, content strategies, customer and industry insights, internal and external communications, design, and events. George actively engages in leadership roles in both the financial services and marketing communications communities. He a member of the Forbes Communications Council, an invitation-only, fee-based organization of senior-level communications and public relations executives, the CMO Council and the CMO Club.

Artificial intelligence (AI) and machine learning (ML) technologies have reached the tipping point of being more than just a theory and are now a reality in many businesses. In response, many wealth management firms have shifted from business process outsourcing (BPO) to robotic process automation (RPA) for their mundane tasks.

Over 68% of U.S. consumer products companies outsource at least some of their business processes to reduce costs, improve work accuracy and keep their organizations running efficiently. RPA offers a huge opportunity for businesses to further cut costs with strategic investment in automation. However, not every task can be done by a machine; for those that can, automation offers better scalability, cost benefits, and accuracy.

Outsourcing with a Fresh New Look

The outsourcing industry has been a constant and integral part of business operations for decades. The explosive growth of AI, ML, and natural language processing has shifted the conversation away from using offshore firms with inexpensive labor — the lure of many BPO organizations toward integrating technology into business processes.

For most organizations, RPA achieves five main goals: cost reduction, flexibility, speed to market, access to tools and processes, and agility. According to data from Deloitte’s Global Outsourcing Survey, in prior years, the focus on speed to market and agility was key as many industries combated swift and unrelenting disruption. However, in 2020, cost savings were again on top as COVID-19 and market disruptions cut into profits, and many organizations had to tighten their budgets. Of those surveyed, 70% identified cost as the primary objective for outsourcing.

The steady pressure on fees and traditional revenue streams from fintech innovators has led many wealth management firms to find new ways to cut costs while still providing quality service to investors. RPA offers those cost-cutting benefits without sacrificing quality.

RPA Is Scalable and Agile

Beyond cost-cutting, RPA also offers some important benefits to wealth management firms. Unlike traditional BPO organizations, RPA is scalable and agile in a way that human labor can’t be. During uncertain markets or fluctuations in demand, wealth management firms can easily optimize their workloads and efficiencies with RPA.

AI and ML technologies require an initial upfront investment, but once implemented, it can smooth the flow of work and work just as well with large volumes of tasks as it would with a small volume. Since many firms still rely overwhelmingly on paper, allowing RPA to take over and complete tasks quickly means clients and advisors get what they need quicker and reduce redundancies and labor-intensive task management.

RPA also brings in a skill that isn’t replicated by humans — accuracy. For compliance and other tasks where accuracy is critical, RPA allows wealth management firms to easily and efficiently produce precise results time and time again.

Wealth Management Is Poised to Adopt ML and AI Now

AI and ML have been ambitious projects by tech companies for decades. In the past, many of the useful applications for these technologies have sat squarely in the tech sector. But, as the capabilities of RPA increase, their application is now broader than ever before.

RPA is particularly well suited for back-office business processes that are rife with repetitive tasks. But, as the technology begins to pick up speed, more and more firms will feel comfortable handing over other tasks. For instance, Vanguard has piloted an intelligent agent that helps customer service agents answer common customer questions. All of these implementations save time for advisors or customer service agents and give them and investors time back to focus on the work that matters most.

For wealth management firms, the time to consider RPA is now. AI and ML for business processes is no longer a question of if but when. To meet customer expectations for always-on reporting, omnichannel interaction, and continued regulation requirements, firms and RIAs can no longer rely solely on paper processes or even BPO offerings.

Wealth management firms and the financial services industry as a whole are investing heavily in technology that enhances the client experience and streamlines advisors’ day-to-day work. However, despite spending a record 3.69% of revenue on technology, not all firms are seeing the returns they expected.

While fintech and larger firms continue to innovate and drive technology in wealth management forward, many laggard and smaller firms are devoting their technology spend to legacy systems that make up their core IT stack. As these systems continue to age, some firms have found it difficult to keep up with the pace of disruption in the wealth management space. As they add new tools and technologies to their systems, they continue to fracture and silo their processes, making it more difficult for advisors to do their jobs.

Top-performing firms are laser-focused on the client experience and streamlining processes. They devote their technology resources toward tools and processes that integrate with their existing systems and build on a strong foundation that will be scalable and flexible far into the future.

Creating a Technology-Enhanced Client Experience

Even with record spending on technology, firms still need to prioritize projects and choose investments that will pay off. Top firms create strategic plans that map tools and technology to customer experience initiatives.

For top-performing firms, technology is key to creating a better client experience. InvestmentNews Research’s 2020 Adviser Technology study found that nearly all top-performing firms “believe that the digital client experience is at least somewhat important to firm success.”

Firms have a tremendous opportunity to enhance their client experience and include digital tools in their offerings. A PwC survey found that “69% of high net worth individuals (HNWIs) are now using online/mobile banking, but only a quarter of wealth managers currently offer digital channels beyond email.” To keep pace with rapidly growing fintech solutions and the fierce competition for clients, firms need to demonstrate value and meet customers in the digital spaces they use.

Some of the client-facing technologies most firms use include digital signing tools, client portals, videoconferencing, online booking, and appointment management. But, enhanced client experiences look like fully digital onboarding, dashboards that allow 24/7 reports, and recommendations based on client behavior and profile.

The point of these tools and investments is to streamline communication, allow clients to self-service and research, and deepen the relationship between clients and advisors. PwC’s survey also found that only one-third of wealth management clients are very satisfied with their financial advisors, leaving lots of room for improvement and opportunities to deliver the type of digital experience their clients expect.

Streamlining Regulatory Compliance with Technology

Regulatory requirements and compliance are an ongoing reality for wealth management firms. Governments across the globe have increased regulations and stepped-up oversight. The challenge for many firms is adopting processes and integrated solutions. Many firms created piecemeal systems that left individual processes isolated from the rest of the business. Now, many are investing in rebuilding holistic systems that streamline the compliance process.

Once this type of system is in place, automation is possible. Rather than completing repetitive compliance tasks, advisors can rely on robot process automation (RPA), machine learning (ML), and other tech solutions that are faster, cheaper, and more accurate. Since many regulatory requirements overlap, building and maintaining an automated system reduces the workload significantly and standardizes compliance programs.

Automation, systemization, and centering the client experience are the priorities for top-performing wealth management firms. Firms should bring technology solutions together, eliminate redundancies, and create integrated ecosystems that streamline and enhance the client and advisor experience. Organized systems keep customers up-to-date on what they need to know about their portfolio and simplify the compliance process. Dashboards and portals provide investors with several options to contact their advisors and allows advisors to see important information about clients at a glance.

Integrating back-office operations and client-facing systems isn’t a simple task, but it’s an essential part of creating and maintaining a client-advisor relationship.


Ryan George is the Chief Marketing Officer at Docupace. He is responsible for the company’s brand awareness, early-stage sales pipeline, content strategies, customer and industry insights, internal and external communications, design, and events. George actively engages in leadership roles in both the financial services and marketing communications communities. He a member of the Forbes Communications Council, an invitation-only, fee-based organization of senior-level communications and public relations executives, the CMO Council and the CMO Club.

The wealth management industry was well on its way to experiencing significant disruption. Fintech startups, cryptocurrency, and innovations in artificial intelligence (AI) and machine learning (ML) began to rock one of the last traditional markets left standing in the wake of digital disruption.

In 2020, that change was accelerated as a tsunami of new retail investors entered the market. Even though the year was marked with turbulent markets, a new generation of investors that were younger, less wealthy, and more racially diverse than past generations entered the market for the first time, according to research from the FINRA Investor Education Foundation (FINRA Foundation). This new group of investors stands poised to push the wealth management market into a new normal of doing business as they bring a host of expectations, standards, and desires to the table.

The Self-Service Investor

A rising tide lifts all boats, and the younger generation of investors has rapidly changed the wealth management landscape for everyone, including older investors. In Deloitte’s report “10 Disruptive Trends in Wealth Management,” they identify this type of investor as a “re-wired investor.”

This group wants a partnership with their investor that puts them in the driver’s seat. They want to understand the investments they’re making as well as the advice they receive from advisors and use their own research and knowledge to supplement expert opinions. The FINRA Foundation’s study found that 48 percent of investors in their sample who had an account prior to 2020 reported relying on financial professionals when making investment decisions. But, only 23 percent of new investors did so, opting instead to rely on family, friends, and colleagues (38 percent) or data from individual companies they wished to invest in (37 percent).

In order to reach this type of investor, wealth management firms should have client/advisor access through multiple channels, an intuitive, self-directed digital experience, and a variety of advice resources available.

Automation with a Human Touch

Many newer investors eschew the one-size-fits-most in wealth management. Even though younger investors have less net worth, they expect to be given the same options and treated with the same level of personalization as high net worth individuals (HNWI). And fintech and BigTech startups have risen to this challenge by offering a low barrier to entry with an array of value-added services fit for their needs and investment personality.

HNWIs have also found the value in hyper-personalization. According to data from Capgemini, only 26% of wealth management firms see BigTech competition among the top disruptors to the industry. But, “74% of HNWIs report a willingness to consider wealth management offerings from BigTechs.” This is driven by the fact that traditional wealth management firms have yet to seize the opportunity to offer the level of service and personalization that BigTech solutions, like Amazon and Netflix, boast for their clients.

Wealth management firms that can harness data analytics, ML and other analytical tools to deliver tailored solutions and on-demand reporting stand to capture a large market share of new and existing investors.

New investors are zealous and eager for investment opportunities. The FINRA Foundation’s study respondents found that the top three reasons new investors opened accounts were (1) the ability to invest with a small amount of money, (2) wanting to invest for retirement, and (3) the dips in the market that made stocks cheaper. These conditions will continue to draw new investors in 2021 and beyond.

However, the challenge for financial advisory firms will be to recognize the top disruptors driven by new investors that have weaved their way into the expectations and desires for experienced investors and HNWIs. Anticipating these demands to deliver personalized, intelligent, and in-depth client solutions will allow top firms to capitalize on the best that this disruption has to offer.

Thanks to advanced innovation in artificial intelligence (AI), machine learning (ML), and robotic process automation (RPA), repetitive tasks have been automated, lengthy workflows have been streamlined, and previously ambiguous insight into customer’s financial patterns has been deepened. However, many firms have struggled to leverage these new solutions while maintaining a human touch.

Top wealth management firms have achieved a balance between adopting new technology and keeping the advisor connection by utilizing new solutions and technologies in processes that are not client-facing, including data entry, risk analysis, performance analytics and process automation. The approach ensures that clients can access technology’s ease and convenience while having access to an advisor should questions or concerns arise.

Clients Still Crave Human Interaction

Even with today’s rapid digital shift, there are still individuals who prefer a human touch. One survey by Edward Jones found that 83% of respondents preferred working with a human advisor compared to the 17% of those who preferred working with a robo-advisor.

When it comes to money, customers naturally prefer to interact with people because money management is a highly emotional issue. Regardless of how much wealth a client has, an individual’s financial goals and priorities will evolve as they move through different life phases. Because of this, many want to communicate with someone who not only understands these emotions but who has possibly experienced them as well.

For example, during the COVID-19 outbreak, thousands of individuals turned to their advisors for advice on their 401K withdrawals or investment risks. Only a human investor could understand the numbers and the emotion behind the current health and economic concerns.

Additionally, an advisor has the emotional intelligence (EQ) to determine where a client is emotionally. Based on a client’s social cues, they can determine when they are frustrated, overwhelmed, or happy and provide the appropriate human response, be that advice or empathy. As advisors become an integral part of their clients’ emotional lives, a deeper, more trusting relationship is formed. Once this trust has been formed, firms can then turn to data analytics, AI, and machine learning to drive results and value for clients.

Leveraging Technology to Deliver Quality Advice

While many clients feel that having a human touch is important, they still expect wealth management firms to utilize new technology. In the same survey by Edward Jones, 95% of those polled stated they expect financial advisors to use the latest technology and tools as part of the advising process. Firms that utilize AI to analyze financial trends, chatbots for customer service needs and data analytics to understand clients’ needs or the financial markets command a competitive advantage over other firms. Additionally, this new technology increases customer satisfaction as employees can respond quickly to customer concerns.

Analytics, machine learning and AI enable advisors to provide personalized, strategic advice based on the current financial market and clients’ unique needs. Additionally, many of these technologies handle repetitive or mundane tasks, freeing up more of an advisor’s time, allowing them to focus on strategic concerns such as ensuring clients have enough life insurance or maximizing investments.

Finding the Human-Technology Balance

The emergence of AI, big data, and machine learning has revolutionized how wealth management firms do business. These technologies enable financial advisors to streamline workflows and automate business processes and bolster the way they care for clients. Rather than spending most of their time crunching numbers, analyzing financial trends, or entering data, they can spend more one-on-one time with clients, discussing future investments, business opportunities, and other large-scale priorities.

Successful wealth management advisors leverage technological innovation to provide more time for human empathy and relationship building. Achieving this balance ensures that clients get results and offers a human connection where it’s needed most.

New digitization initiatives and changing customer preferences have combined to upend the customer and advisor experience within wealth management. Previously, customer strategy was focused on data points, such as a sleeker, more responsive website or creating more self-service options. However, the focus is now shifting to bridging the gap between the above data points and building an engaging, proactive client-advisor relationship.

Much of this shift is attributed to market disruptions within the industry. Fintech start-ups and an increase in alternative savings vehicles have changed the customer experience on virtually every front—from how wealth is managed and invested to financial guidance. High-growth RIAs have not only recognized changing expectations but embraced them, permanently shifting to provide a faster, easier, and more comprehensive experience.

How Firms Can Respond to Changing Customer Expectations

In the digital age, clients expect to have any time, anywhere access to advisors as well as unrestricted access to a wealth of information. This trend is only expected to accelerate as more digital technologies become available. Furthermore, wealth management firms face the pressures of increasing compliance standards, forcing many firms to reimagine their business processes.

Alongside these factors, data is more important than ever in shaping both processes and the customer experience. Wealth management firms must utilize this data to address market risks and create a fulfilling interaction to stay competitive. However, because most organizations are in the early stages of transforming their digital processes, there is much work to be done. In a report authored by Refinitiv, 46 percent of respondents stated that they were “only partly satisfied or not at all satisfied with their current digital offerings.”

Firms need to bridge this gap and offer a more rewarding client experience by focusing on the following:


Looking Forward

Market disruptions and rapidly evolving customer trends accurately show the challenges firms face today. Many firms (80 percent according to Refinitiv) have increased spending on ‘change the bank’ initiatives to transform their customer experience. Much of this spending is on solutions that increase customer insight and utilize the latest technology to improve decision making and user engagement.

For firms to thrive in this new environment, a well-defined strategy supported by accurate and holistic data and the right tools is needed. Only then can firms provide a customer experience powered by digitalization and the latest industry trends, accelerating their growth for the foreseeable future.

Wealth management firms are undergoing a massive digital transformation. With the litany of digital tools available to potentially solve every problem, some firms have implemented solutions that are a patchwork of solving for individual situations rather than an ecosystem of tools that actually deliver the promised efficiency.

Just as investors are demanding more personalized and integrated experiences from their digital tools, financial advisors and other wealth management professionals, such as back office operations, want the same. Back office professionals want tools that remove unnecessary work from their to-do lists, enhance the client-advisor relationship, and provide transparency and flexibility to build their business as they envision it.

Banishing Silos and Reducing Duplicated Work

Knowledge workers globally, but particularly in the United States, suffer from inefficiencies in their workday. According to research from Asana, coordination or “work about work” consumes nearly 60% of the average workday. Strategy and skilled work lag at 14% and 26% of the workday, respectively. Lack of clarity about job roles and processes increases the number of meetings and check-ins workers endure to complete business-critical tasks. The average worker in the U.S. loses 6 hours and 28 minutes per week to duplicative work or work that has already been completed.

Despite their promises of delivering streamlined and efficient work experiences, the number of apps and productivity tools is holding many professionals back. These professionals switch between 10-25 apps per day, and every time they switch tools or move to another platform, they risk missing actions and messages. Asana’s research indicates that over 25% of workers have missed deadlines and actions because of switching tools and say app overload makes them less efficient.

Integrated tools that minimize switching, create frictionless workflows, and implement automation to prevent duplication are the key to getting financial advisors and their teams back to work efficiently. Tools that communicate with each other and share data, create clear workflows and minimize ambiguity about priorities and job roles.

Augmenting the Back Office Experience

When it comes to advisors, they want digital tools that they can trust to back up their expertise. Rather than having an algorithm dictate daily activities, a platform or software solution should offer support and create an experience that puts them in the driver’s seat.

Essentially, these financial advisors want to provide the transparency and personalization their clients expect and utilizing the right tools can deliver that. However, to do so, these tools must carry some level of customization and make data easily, securely accessible for those who need it.

Finally, platforms should support advanced queries, templates and other tools that offer a combination of automation and customization that advisors can use to save time and give personalized advice to their clients without reinventing processes each time.

As many financial professionals have shifted to working from home or other environments outside the office, disruption and distraction have devoured valuable time. As a result, many knowledge workers have experienced burnout and stress due to constant pressures on their time and blurred lines between work and home.

Retaining and hiring new talent will require wealth management firms to recognize these problems and create processes not only to help their bottom line but to preserve worker wellbeing. This means investing in tools that eliminate duplicative tasks and help solve problems rather than create additional layers of complexity. This will be key to keeping a foothold in a rapidly changing global work environment.


David Knoch is CEO of Docupace a solutions provider focused on digitizing and automating operations in the financial advice and investment industry. David currently serves as the Immediate Past Chair of the Financial Services Institute (FSI) Board of Directors and has been voted one of the 25 most influential people in the Investment Advisory industry two years in a row – 2018 and 2019.

Regulatory compliance continues to be a top priority and cost center for wealth management firms. The preparation for and implementation of Form CRS and Reg BI increased the budget and resources wealth managers spent on compliance activities.

The median implementation cost for Reg BI is $3.28 million, with 54 percent of those costs attributed to technology. Firms focused on choosing and investing in the right digital solution will have an advantage in staying ahead of changing regulations.

Here are some of the early results from Reg BI and Form CRS, what concerns regulators see already, and how financial advisors and home office professionals can adapt their processes to meet compliance requirements more efficiently and build a more reputable relationship with their clients.

Early Feedback from Regulators on Reg BI Compliance

Overall, regulators agree that firms are rising to the challenge of this new rule. Attempts to meet compliance requirements have so far been enough, but that may not last. Soon, regulators may expect stricter adherence to the rules.

The Form CRS continues to be the primary source of problems for firms. Feedback about inadequate compliance includes:

Because of some of these issues with Form CRS, the SEC updated its FAQs and revised their guidance to help wealth management firms meet the requirements and spirit of the rule.

Reg BI Tips for Financial Advisors

Operationalizing Reg BI requirements is a significant challenge for firms. Many firms have had to make substantial adjustments, including but not limited to changing technology, systems, and advisors’ relationships with their clients. Specifically, a Deloitte survey found that 36% of respondents ranked defining best interest as the most challenging operating model change.

Advisors shifting from a simple fiduciary requirement must clearly describe the differences in a transactional and advisory (fee-based) relationship. Using Reg BI as an opportunity to turn compliance into trust can build and reignite client relationships. Form CRS’s essence is documenting the rationale for recommending a specific fee structure and embracing fiduciary advice.

Investors today want transparency, simplicity, clear costs, and communication about fees. Taking the compliance conversation deeper than only meeting guidelines helps investors feel more confident and safe in who they go to for investment advice.

Reg BI Tips for Home Office Professionals

Documented processes are the standard for any compliance program. Documentation is also where firms should start when they consider Reg BI. But, treating Reg BI as merely an extension of FINRA standards is missing the mark. Firms should tailor their compliance and documentation for individual business models.

For instance, written policies and standards should not mirror the written regulations. Reg BI requires that these policies fit their business models, including documentation of alternatives for customers, considering costs.

Cost considerations are a critical component of Reg BI, and the SEC FAQs include special callouts for IRA rollovers. Firms should write these disclosures in language clients understand and explain why they recommend a particular course of action, fee structure, or product.

Finally, conducting a conflict of interest audit can uncover gaps in compliance and fortify documentation for regulators. Firms should review payout grids, product menus, and sales practices and consider each of these factors from the client’s perspective.

When writing policies, firms must identify and disclose all conflicts of interest and mitigate any conflicts that might put their interests above the client’s interests.

The regulatory burden on wealth management firms is a significant cost center. Taking a holistic approach to compliance, considering the customers’ perspective, and seeking to build trust and a partnership with clients is key to not only meeting but exceeding regulators’ expectations for Reg BI compliance.

COVID-19 has forced many businesses to adapt and even rethink their business models. The traditional ways of doing business, such as in-person meetings and physical document exchanges, have been replaced with Zoom meetings and digital signing.

As wealth management firms prepare to return to a new normal, digital tools will become a key part of meeting client expectations. While many organizations had implemented some of these tools, the pandemic drove adoption and implementation dramatically. And, as younger generations begin to amass more wealth — Millennials are set to inherit nearly $68 trillion by 2030 — they’ll expect solutions that are personalized and digital.

To compete in the market post-COVID, many organizations have optimized their operations for the digital world to capitalize on the massive growth and valuation opportunities that lie ahead.

Digital Companies Create M&A Opportunities

According to Financial Advisor IQ, the year 2020 saw a record number of mergers and acquisitions, up 20% from 2019. Of 159 total deals in 2020, most transactions occurred in the second half of the year. Wealth management firms that transitioned to digital workflows gained a key advantage over their competitors: agility. This agility is crucial for M&A activity. Whether you are a buyer or a seller in the M&A arena, your speed to market and ability to react to market trends, changing conditions, and (especially) disasters can be a determining factor in your valuations.

2020 also saw an increase in deal sizes, where the average valuation of acquired firms is said to have reached $1.7 billion. As the dollar figure of deal sizes rise, firms that effectively leverage digital solutions are in pole position as both buyers and sellers because of an increased ability to onboard clients, manage documents, and automate transactions.

Optimizing operations for more digital services removes the hassle of paperwork and manual signatures from investors and advisors, creating a more satisfying and productive wealth management experience that can be completed faster than ever before. All this adds up to more profitability and higher valuations, which puts you in a better situation whether you are buying or selling in the current M&A arena.

Digital-Ready Firms Are More Disaster Proof

The global pandemic taught businesses that their reliance on a physical location is dangerous to their future. In 2020, many firms were severely threatened by COVID-19 restrictions because they could not access physical files in their offices or meet with clients in person. In a PWC survey, concerns about COVID-19’s impact on workforce conditions and productivity was a top concern among wealth management firms.

Firms that transition to digital operations through a secure platform can access client data and work with clients, regardless of their physical location, putting their minds at ease and keeping business moving during an already turbulent time. This added resilience and flexibility adds value to a firm by making them less vulnerable to physical threats posed by elements, disasters, and data breaches.

As the world continues to recover from the current pandemic and enter a new normal, firms that operate digitally reduce their recovery time while increasing their ability to empower advisors and investors alike.

Digital Firms Win the Talent War

The wealth management industry is also experiencing a shortage of talented younger advisors and increased competition for competent professionals. In 2018, the Retirement Income Journal estimated that less than 12% of financial advisors were under 35. Younger professionals are proficient with technology and can be attracted to industries with more innovation and disruption.

The digital transformation of wealth management operations gives firms yet another advantage because they extend their reach. When a firm is not tied to a building or specific location, they widen the talent pool to a global audience. Advisors feel supported no matter where they are and can provide top-notch service to clients as if they were in an office. By removing the barrier of physical location, firms also open themselves up to new clients they would have otherwise missed out on, which adds diversity and quality to their portfolios.

The COVID-19 pandemic has accelerated the digitization of wealth management, and many firms have made changes in months that were predicted to take years to implement. With the coming volatility and uncertainty in the economy, many clients are looking to their advisors to weather the storm and find stability. Offering solutions that meet clients where they are and flexibility to keep business moving during periods of anxiety will set firms apart and provide opportunities to serve their clients better than ever.

Download Report: Wealth Management’s Digital Future


Ryan George is the Chief Marketing Officer at Docupace. He is responsible for the company’s brand awareness, early-stage sales pipeline, content strategies, customer and industry insights, internal and external communications, design, and events. George actively engages in leadership roles in both the financial services and marketing communications communities. He a member of the Forbes Communications Council, an invitation-only, fee-based organization of senior-level communications and public relations executives, the CMO Council and the CMO Club.

Women’s share of global wealth has outpaced the market and continues to be one of the largest growing sectors in the U.S. economy. According to research from McKinsey, “By 2030, American women are expected to control much of the $30 trillion in financial assets that baby boomers will possess—a potential wealth transfer of such magnitude that it approaches the annual GDP of the United States.”

Women also continue to make big strides in leadership positions, occupying some of the highest financial management positions, including the Treasury Department.

While women have changed the game in global wealth, the wealth management industry has lagged in serving them and understanding their needs and goals. Even though startups and fintech investors are beginning to snatch up these clients, there’s still an opportunity for traditional wealth management organizations to pivot to include women in their list of potential clients.

Understanding Gender Differences in Investment Styles

Women have long been a driver for household economics. According to a study by Merrill Lynch, women feel just as confident as men in tasks such as budgeting or paying bills, but that confidence wavers when it comes to investment. Only about half (52%) of women say they are confident in managing investments.

While women tend to invest less than men, when they do, their investments are based on the values that matter most to them: family. Merrill Lynch’s study found 77% of women view money through the lens of what it can do for their families. Women are also drawn to impact investing and choose causes that matter to them.

Women’s investments tend to be more deliberate, diverse and agile than men’s investments. As a result, their returns are higher. A Fidelity Investments analysis of client data showed, on average, “Women performed better than men when it comes to investing by 40 basis points, or 0.4 percent. At first glance, this may appear to be a minor difference, but can have a significant impact over time.” While men tend to “swing for the fences,” women are content with a string of singles.

To attract and be effective with women investors, wealth management providers should embrace new ways to deliver information, offer more diverse advice providers, and above all else, listen to and understand women’s wealth goals.

Younger Women Are Showing Improved Financial Literacy

Younger women, in particular, take a more active role in building wealth. A survey from BCG showed “70% of millennial women (those born between 1980 and 1995) said that they take the lead in all financial decisions, compared with just 40% of female baby boomers.” Millennial women have more formal education than previous generations, and they’re participating in the workforce in greater numbers than their parents and grandparents.

As women in younger generations age, they continue to amass and concentrate their own wealth. According to BCG, “From 2019 to 2023, North America will continue to have the largest concentration of female-owned assets, with women’s wealth in the region projected to rise at a steady CAGR of 6.9%, although this rate is slightly lower than the anticipated global average of 7.2%.”

Wealth management providers should recognize this changing dynamic in younger generations and seek out ways to meet their needs and how they might differ from other clients.

Building a Culture/Service Model of Inclusivity

Effectively reaching women is about more than recognizing their share of capital. Wealth management professionals will need to see women as individuals rather than a single group with the same goals and strategies.

BCG notes that offering plenty of information and options puts the power into women’s hands to make decisions they can trust. “Recognizing the importance of data, leading advisors will use visualizations, simulations, and analytics to help women reach informed decisions. Dynamic tools that make it easy to evaluate different scenarios can enable women to see how they might put a portion of their cash and deposits to more productive use while preserving the liquidity they need.”

Building a culture of inclusivity doesn’t happen by accident. It is a deliberate, thoughtful process. Wealth management providers that offer a diverse offering of investment advisors and take a client-centric approach to investment will be poised to take advantage of the significant financial footprint that women investors offer.


Judie Endemann is Head of Operations at Docupace. Judie has supported executive teams through a variety of growth cycles, from early-stage startups to publicly traded international companies. Prior to joining Docupace, she served as VP of Corporate Services for a global digital media technology company. It was there that, in partnership with the executive team, she designed an acquisition strategy that led to the purchase of a division of a multi-billion dollar, publicly-traded company.

Wealth management’s technological shift is happening on multiple fronts. Firms are investing in new technologies while simultaneously scaling their existing systems and integrating outsourced solutions to create a more holistic and dynamic client experience. The rise of robo-advisors, artificial intelligence (AI) and machine learning (ML), and transparent, flexible dashboards offered by fintech startups have pushed traditional firms to adapt and innovate if they want to catch the interest of younger investors.

Spending on cloud-base solutions accelerated dramatically in the early months of the COVID-19 pandemic as many organizations scrambled to implement remote working solutions or scale up what capabilities they already had in place.

While the pandemic can’t end soon enough, this trend upward will be around a while, according to Gartner. Cloud solutions are projected to make up 14.2% of the total global enterprise IT spending market in 2024, up from 9.1% in 2020.

A Thomas Reuters survey last year showed 68% of respondents looked to implement new technology to stay nimble in the “new normal,” and 69% of participants said they are hoping technology developments will keep their firms relevant in the short and long term.

As wealth management firms address these issues and other challenges facing them in 2021, here are some trends to consider as you evaluate and invest in new technology.

Technology Spending is On the Rise in the Advice Industry

Wealth management firms across the industry view technology as vital to success in the digital world. Leading voices like Fidelity and Goldman Sachs are competing heavily for the best tech talent as they implement blockchain, AI, virtual reality and other technologies to anticipate the needs of customers before their competition.

According to InvestmentNews, “the median year over year increase in tech spending was 15.8%, for an average of $120,309, an all-time high.” It is anticipated that this trend will continue at an accelerated pace, as experts predict annual technology spending across the financial services industry will reach $24 Billion by 2023.

What do the Executives at these name-brand companies understand best about technology? That it’s not just a tool, it’s a strategic advantage. This is why the industry leaders put a decent chunk of their revenues right back into enhancing their technology stack. InvestmentNews reports that firms spent a record 3.69% of revenue on technology.

Investment is Focused on Efficiency Gains, Enhanced Experience

Investing in software and tools that improve processes empowers advisors to use their time more efficiently, focus on more strategic matters, and perform at the highest level. Technology investment only works if it improves the way a firm operates.

InvestmentNews reports that wealth management firms look for technology that streamlines processes, automates workflows and helps them better serve their customers. This operationalization strategy pays off, too; according to FinancialPlanning, automating workflows can help financial advisors close deals 25% faster.

On the other side of the “virtual” desk is the customer experience.

Investing in technology that enhances the customer experience helps firms attract newer, younger investors and keep them coming back. Wealth management firms with enhanced digital experiences gain advantages over competitors, including:

Cybersecurity Remains a Top Concern

As wealth management firms incorporate more digital operations into their strategies, cybersecurity remains a top concern among advisors and investors. In 2018, 20% of the cybersecurity events reported to the Financial Conduct Authority in the UK came from financial services firms.

With breach events consistently making headlines for several years now, anxiety across the industry has steadily risen — 66% of advisors say that cybersecurity will be a top concern over the next few years, according to InvestmentNews research. While wealth management firms may not physically hold their client assets under management, they are legally required to collect and store vast amounts of information for all clients, making them a potential target of the bad guys.

As many firms shift into their new normal and uncertain markets, they’re taking inventory of their technology and seeking solutions that support a remote workforce and clientele, optimize costs, and provide a launchpad for innovation.


Patrick McMahon is Executive Vice President – Enterprise Business Solutions at Docupace. Patrick is an experienced sales leader who works with C-level executives and business owners to execute digital transformation programs and modernize operational processes. In his role, Patrick has helped many organizations, both large and small, in the investment and financial advice industry realize their true potential by moving to the cloud and streamlining their digital processes.