Chief Technology Officers (CTOs) of wealth management firms have a lot of responsibility: choosing technology vendors, training staff, evaluating processes, coordinating integrations – the list goes on.

That’s why we’re proud to sponsor a recent Think Tank event, which brings together CTOs and technology experts from top wealth management firms to explore their insights, challenges, and goals for the future.

In a recent webinar hosted by Shannon Rosic of WealthManagement.com, three key industry leaders discuss the Think Tank findings and what it could mean for firms across the globe:

• John O’Connell, Founder and Chief Executive Officer at The Oasis Group
• Michelle Feinstein, GM/VP Global Financial Services Solutions & Strategy at Salesforce
• Rusty Sommer, Managing Director – Strategic Partnerships at Flyer Financial Technologies

Read on to explore highlights from the event, including takeaways regarding client retention and growth, cybersecurity, digital workflow automation, owning and leveraging data, and artificial intelligence.

Click here to watch the free, on-demand webinar, “The Evolution of the CTO: Think Tank Insights Shaping the Buy-Side

Client Retention and Growth

In the age of all-in-one solutions, many advisory firms are searching for a true, 360-degree client view fueled by integrations between their CRM, portfolio management system, and other customer relationship tools. However, issues arise when these systems lack robust APIs that are not predefined or pre-integrated.

Another challenge Flyer’s Rusty Sommer points out is the need for technology that can support more run-of-the-mill activities as well as more sophisticated, one-off tasks without requiring team members to switch between platforms. That type of interoperability is best accomplished through a connected tech stack, which can improve productivity for CTOs, COOs, and advisors – while also elevating the client experience.

Cybersecurity

Cybersecurity breaches are becoming more sophisticated, requiring equally complex solutions to prevent disastrous hacks. Moreover, the majority of small businesses that fall victim to a major cyberattack wind up going out of business within just six months. With so many wealth management companies falling squarely into the small to mid-sized business designation, cybersecurity should be at the top of every CTO’s priority list.

“Only about 20% of firms have a cybersecurity program,” O’Connell says. “That’s really concerning, because there’s been a 600% increase in cybersecurity incidents since COVID.”

Top risk areas are in the communication tools advisors are using to share data with clients, as well as phishing attacks aimed at staff members. From emails to even the QR codes you scan at the coffee shop, our devices offer ample opportunities for would-be hackers. To mitigate those risks, it’s crucial to continuously educate team members and choose vendors wisely.

“Flyer is constantly testing and certifying,” Sommer explains. “If there’s a new connection, broker, custodian, or client, we have a whole process that we go through to make sure the connectivity is set up correctly – that it’s working, communicating the right way, the security procedures are in correctly, that everybody’s getting the data back and forth appropriately.”

Flyer’s processes also account for any data interruptions so they can know immediately where the data flow stopped and where it should be picked back up again once repaired.

Digital Workflow Automation

Imagine a process that could import data directly and employ it throughout each customer lifecycle. That process hinges on effective digital workflow automation.

Feinstein says that when working with a client at Salesforce, she often tackles digital workflow automation in three main steps:

• Getting the lines of business in their enterprise onto the same platform
• Digitizing engagement to ensure their CRM is being used to its full potential
• Workflow orchestration to create simple, consistent processes

However firms choose to tackle automation, O’Connell reminds them how important change management is to success:

“The firms that are ignoring this at the moment or just throwing bodies at it are going to grind to a halt – they’re not going to be able to grow as fast. And that’s going to really affect the valuation of that firm and the exit capability for that firm moving forward.”

Owning and Leveraging Data

The panelists’ discussion about owning and leveraging data in wealth management underscores the pivotal role of a robust data strategy in firms’ operational efficiency and growth.

Many firms are adopting best practices by establishing data lakes, consolidating information from diverse source systems into a unified repository. This consolidation allows for the selective application of real-time data syncing, particularly in areas where immediacy is crucial, such as client engagement.

Feinstein says:

“I think what scares a lot of wealth firms is ‘Where do I begin? How do I tap into all this consolidated data and create the analytics that my advisors need, that my middle office needs?’ And I think the message is you don’t have to start from scratch, right?”

Ultimately, owning and leveraging data not only drives operational efficiency but also enhances client outcomes, experiences, and firm profitability – positioning firms for sustained growth and giving them a competitive advantage.

Artificial Intelligence

When thinking about the capabilities of artificial intelligence (AI), O’Connell says, “The machine learning capability that you’re going to see coming out of AI – the ability to do predictive analytics on your data set – is going to be incredibly important. But AI, just like any other computer program, is dependent upon the data you give it.”

Sommer likens AI in wealth management to a science fair project: “A lot of people maybe have an AI project, but they don’t actually have a defined outcome.”

The panelists agree that AI use cases are only accelerating, but it’s key that firms find a way to harness those abstract possibilities and turn them into real-world applications to better serve their teams and clients.

These Think Tank leadership initiatives are uncovering new ways wealth management firms can fuel growth through their technology, from client retention to artificial intelligence and everything in between.

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