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The revolution of data and its impact on financial advice

17 June 2022 Riaan Verbeek, Chief Operations Officer at Consult by Momentum
Riaan Verbeek, Chief Operations Officer at Consult by Momentum

Riaan Verbeek, Chief Operations Officer at Consult by Momentum

There is no denying that the data revolution is here, and it has a significant impact on financial advice. The accuracy and availability of data means that financial advisers are now expected to know much more about their clients to ensure that they provide a customised service to each client.

Data has become one of the biggest commodities and it can be a business’s biggest differentiator. It constantly evolves to give businesses an in-depth view into the preferences of customers. But new data mining requires new data structures, which sees many established enterprises struggle to adapt to, due to their deeply rooted legacy systems.

In our industry many of our clients today expect their financial advisers to have a complete understanding of their financial life, and not just certain portions of it. If advisers are not using data to more accurately anticipate the wants and needs of their clients, then their clients are going to be left disappointed. For financial advisers, it is incumbent to use data as a central point in how they interact, engage and find success for their clients because the expectation is already there.

Data also represents a massive opportunity for all businesses and not just financial advice - no matter where they are in the digital transformation or digitisation process. Thanks to technological advancements, most businesses can be classified as digital or ‘intelligent’ businesses in today’s age. Taking a data-first approach, and implementing it correctly can ensure that your business sustains data quality, and this can deliver an exponential return on investment.

Without proper data capture, all modern technology doesn’t mean a thing, as the results you get depend on the quality of data you provide.

By providing more accurate data, you improve your chances of getting the best results of any technology platform you use and therefore can share relevant information with your audience, increase your profitability, and beat the competition.

Our Elite Wealth tool is a great example of how we have used - technology to ensure that we remain ahead of the curve when it comes to data management. The web-based software solution provides Client Management, consolidated Portfolio views, Business Process Management, and integrated Financial Planning modules.

Elite Wealth allows us to seamlessly consolidate investment and risk product data from various product providers onto one platform, giving us a consolidated view, state-of-the-art client reporting as well as valuable management information.

AI tools such as Elite Wealth allow financial advisers to:

• Have a better understanding of clients, allowing them to solve for more financial planning needs
• Close the loop on compliance
• Offer better client services by tailoring services to clients who need them instead of a mass approach
• Make the decisions which will ensure the growth of the practice through knowing where opportunities lie and where to place their focus

Another huge benefit for businesses is that in this new era of hybrid workforces, data is a great enabler of remote working. Having a solid data infrastructure in place can help employees offer the same high levels of service and great customer or client interactions, whether they are in the office or not. The idea is not just about working from home; it’s about working from practically anywhere backed by the power of proper data management.

Quick Polls

QUESTION

A recent discussion on the ‘successful intermediary of tomorrow’ offered some tips to help financial and risk advice practices to thrive through 2022 and beyond. Which of the following do you think will give your practice an edge over the competition?

ANSWER

Achieving cost and scale through digitalisation
Offering customisable product solutions to meet customers’ unique needs
Specialising in one advice discipline only
All of the above
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