It’s undeniable that hyper-personalization has become the standard for digital interactions, with algorithms being able to predict what people want even before they know that they want it. The technological innovations that have supported this shift in behavior, have made customized digital experiences the standard across many industries, forcing financial advisors who are reluctant to adapt to the current landscape to contend with the risk of not meeting client expectations.
For a lot of advisors, the resulting people-pressure has translated into burnout due to advisors needing to operate as coaches in addition to managing portfolios. Skilled professionals are humans, not machines. Independent advisors, especially those who run their own small businesses, simply cannot predict a client’s mood, decision-patterns, and communication preferences in the same way that Netflix, Hulu, and Amazon Prime Video can with their content recommendation algorithms.
So what exactly does this digital acceleration, particularly with the advancement of artificial intelligence and robo advisors, mean for the wealth management sector? On the one hand, technology creates a unique opportunity emerging for wealth managers to work smarter and more methodically — and to deliver a higher level of service to investors, as a result. On the other hand, technology creates unreasonable pressure for constant availability and instant access to insight.
As with any new tool or resource, there’s a balancing act to getting the technology formula right for your unique financial advisory practice.
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Disclosures
This material has been prepared for educational purposes only. It is not intended to provide, and should not be relied upon for, investment, accounting, legal, or tax advice.