Beyond the pandemic: wealth management from the business's perspective

The pandemic has reshaped the wealth management industry in ways that no other event in living memory can match. In 2020, we sat down with a select group of leading wealth managers in March, September and November. The resulting conversations gave a unique window into how firms were responding to the shifting challenges. The content below is extracted from the whitepaper Wealth Management Technology Beyond 2020, which built on the insights and lessons shared in these discussions.

Even before the pandemic, 70% of wealth managers in Europe and Asia said they expected the economic outlook to deteriorate, while 55% anticipated a further increase in short-term volatility. But while the industry is ever perceptive, it had little appetite to counter against this: prior to Covid, a startling 78% had no transformative plans to harness emerging technologies within their business.

Cost challenges

Next generation clients are expected to plough an eye-watering $8.6 trillion into the wealth market over the next nine years alone. But wealth managers are acutely aware that nothing is guaranteed in the modern-day wealth management – and rightly so: some 60% of next generation clients typically veer away from the family wealth manager, taking an estimated $1.5 trillion investable assets with them in the process each year.

Firms within the high-touch, service-led wealth industry have long been beset with high cost: income ratios which average at around 70%. And while advisors and clients alike squared up to the many challenges 2020 presented, portfolios have been battered: the FTSE slumped by 26% in 2020, and with around 45% of global wealth managers’ income based on fees, firms across the board have felt the blow.

Onboarding remains something of an Achilles’ heel within the industry, as clients who have become accustomed to transacting online at breakneck speed are less tolerant of the drawn-out administration that so often stands between them and their new wealth manager. And whether firms have sticky-plastered over out-dated infrastructure or invested in new systems, they increasingly recognise that ill-fitting software and siloed processes can detriment client profiles, audit trails and overarching compliance.

Game plan

Use technology to run a tighter ship and drive efficiencies wherever possible. Step back and take a considered, strategic and systematic approach so you can manage the end-to-end client lifecycle. This will help you squeeze every drop from the client relationship and deliver a more targeted and informed approach as clients progress on your brand journey and their wealth evolves.

“There’s still a need to try and really help advisors, front office teams, sales teams, get the information quickly, easily in context, and find the best way to make those processes more efficient.”

Clients are increasingly scrutinising the cost to serve, and with many confidently staying online for all but the most meaningful conversations, wealth managers must do all they can to drive value and maintain client contact where it counts the most. Look at your own internal challenges in digital adoption and see how your advisors can help clients understand and optimise the tools at their fingertips.

Battle for the budgets

As the second lockdown came to a close, many wealth managers were enthused by surprisingly buoyant performance. But while the industry navigated servicing clients remotely, acquisition has not been quite as easy, with some wealth managers reporting as much as a 60% drop in new clients in 2020.

But there’s much that can be done to sharpen the pencil and drive cost and business efficiencies, and wealth managers are increasingly turning to technology to do just that with many citing widespread adoption of advances such as cloud, software as a service, artificial intelligence and machine learning. But none of these can be possible without staff buy in, and while remote working will undoubtedly reduce overheads, it presents the additional challenge of engaging and motivating staff who are operating in physical isolation.

One wealth executive welcomed the accelerated drive to digitisation but said trying to make sense of this had left many in his firm busier than ever: “There’s still a need to try and really help advisors, front office teams, sales teams, get the information quickly, easily in context, and find the best way to make those processes more efficient.” he said.

Outside the box

Businesses need to work harder to keep existing clients happy, with advisors making the most of face-to-face meetings to build that all-important rapport with prospects, while working with intermediaries to bolster referrals wherever possible.

Be aware that investing in new technologies is not enough: do all you can to engender employee buy-in to enhanced service and delivery models, addressing any gaps in talent and capabilities as your business and its applications evolve. And don’t just look at technology as a fix for the matter in hand: new platforms and systems could well be the key to scaling your proposition to wider audiences at a relatively low cost.

Think laterally as to how you can appeal to new and existing demographics within the wealth and wider financial landscape.

This is an extract from the whitepaper titled Wealth Management Technology Beyond 2020. Download the whitepaper now to understand how 2020 reshaped the wealth management industry and the key learnings firms can take moving forward.


Wealth Dynamix delivers Client Lifecycle Management solutions to the world’s leading private banks and wealth and asset management firms.


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