Financial advisors are awash with data points. But what data matters and how can advisors make sense of it all?
Pershing’s INSITE 2018 conference assembled a panel of experts to answer that question and discuss other tools that are re-shaping the way advisors conduct their business.
The panel was comprised of Marc Butler from Albridge, James Patrick of Envestnet and Dan Malley from Pershing. Here were three of the key takeaways:
Data, data, data: Data has been one of the hottest topics at this year’s INSITE – how to collect data, how to protect data, how to leverage data, etc. But when is a lot of data simply too much data?
Albridge’s Butler believes the pace of technological disruption presents a challenge because it leaves many wondering which data points and solutions really matter. Butler says
Pershing’s Malley concurred, adding, “Don’t mistake volume of data for value of data. More data isn’t helpful – and can hurt the client experience – if there is no accompanying analytics or insights.”
One of the insights Butler believes would be ideal is what he calls “client intelligence.” A solution that can tell an advisor what their client is thinking – especially if they are thinking of changing advisors – is an example of client intelligence, and Butler says such analytics and tools are on the way.
Who is all this data and technology helping?: Being able to leverage technology is a great concept, but advisors would be wise to think about who is really benefitting from the onslaught of technological advancements.
Patrick recounted how a recent class of interns at Envestnet concluded their internships with a group presentation about trust. To the credit of those young interns, they had the courage to inform Envestnet’s management team that young people simply don’t trust the old, white guys who are so prevalent in the financial services industry. Those interns made it clear that young people trust their phones and apps far more.
Malley said part of the reason for that trust gap can be traced back to how financial services firms are using – or not using – the mountains of data they collect.
“Firms aren’t yet using data to make customers’ lives better,” said Malley
Whether he intended to or not, Envestnet’s Patrick went on to prove Malley’s point. While weighing in on robo-advisors and other technologies emanating out of Silicon Valley, Patrick remarked how those solutions “don’t understand an advisor’s day.” Maybe that is because many of those solutions were never intended to serve advisors. They were intended to serve people like the younger investors those Envestnet interns were talking about.
Advisors are tech-savvy and in compliance, but…: One of the most salient points raised during the panel addressed an issue having little to do with technology. Advisors armed with the best technologies are still going to lose clients if those don’t enjoy and value the relationship they have with their advisor.
“Training people to be compliant with regulations and training them to use technology might be diminishing the time spent training on how to handle the client experience,” explained Pershing’s Malley. “Clients don’t care about how much time their advisor spends training on a CRM platform or a compliance tool.”
And that might be one of the most important takeaways from the entire INSITE conference: Data and technology are important, but people skills are still paramount.