Use it or lose it – Can you afford to ignore the rise of hybrid servicing?

The growth of wealth management firms relies on being able to attract and retain clients – especially the NextGen. Only by offering digitalised services will they be able to survive and thrive.


Benjamin Labrousse, Manager, Pre-Sales EMEA, firmly believes that the growth of wealth management firms relies on being able to attract and retain clients – especially those in the next generation(s). Only by offering digitalised services will they be able to survive and thrive. 

Hybrid services, omnichannel approaches, and automation are becoming essential tools to meet clients’ expectations. They combine the convenience of digital self-service with the added reassurance of human support when needed. Only by offering a high level of service will firms build trust with nervous investors and help them reach their financial goals.

Working practices that service the needs of the next generation will thrive

As clients become more acquainted with the hybrid service model, they will see the productivity benefits of interacting with their advisor through an omnichannel approach. By having 24/7 access to information about their investment accounts and easily interacting with their advisor through chat or web calls, clients can build strong relationships while feeling more confident and informed in their decision-making.

Client service spans a broad spectrum of activities, from simple address changes to portfolio re-planning. A relationship manager’s intellectual capital is best spent on service that adds discernible value and builds trust. 

An article from Financial IT reveals that between 47% and 56% of respondents with and without an advisor said they would prefer a hybrid approach for the management of their personal details, answering portfolio questions, performance analysis, receiving product recommendations and investment advice. This figure is higher still amongst younger investors, with 66% of millennials saying they would prefer self-directed investment portals with advisor access. Given the significant transfer of wealth towards the newer generation, it is all the more relevant for advisors to start meeting the needs of younger investors.

As more and more investors look to add cryptocurrency and other new assets to their portfolios, firms need to keep up with the latest trends. A hybrid service that combines traditional investing with new asset classes will ensure that their demographic appeal is broad.

Providing advisory services is also key to winning the lion’s share of a client’s assets. And holding a greater proportion of the assets is key to profitability.

The key to this, according to Deloitte is:

  1. Intimacy – built through long-term relationships as well as frequent and empathetic engagement.
  2. Relevance – solidified by solving their key needs in a timely and effective way, even when those needs stretch beyond traditional offerings.
  3. Perceptiveness is demonstrated by identifying their evolving needs and solution options, both explicit and implicit

Clients can also benefit from real time hyper-personalisation, thanks to technology. And they can also have the personal touch and reassurance needed from an experienced advisor. “Less of the bread and butter is delivered by the human”, envisions Christine Socasau,  Digital Wealth Lead & Product Owner for HSBC’s Wealth Compass, “That can be delivered by the tools and more of the value-add can be delivered by the person, the advisor.” Streamlining the process to maximum efficiency level means that clients get the service they feel happiest with, at a fraction of the cost.

Achieving these more intimate, relevant, and perceptive client relationships cannot rely on highly talented relationship managers alone. Deloitte and Accenture both recommend leveraging a technology platform that enhances the capabilities of the relationship manager. This process helps free them from mundane, repetitive administrative tasks and gives them access to deeper insights driven by relevant client-specific data and recommendations.

Reaping the rewards for your business 

High inflation levels are pushing up salaries, making unlimited human advice unsustainable. Ultimately, firms must pass on the increased costs to their clients or accept lower margins. In a recessionary environment, clients are less likely to accept such fee increases, especially as their investments are not showing high rates of return as markets aren’t growing. At best, they will reduce their investment with the firm. At worst, they will vote with their feet.

Added to that many firms are setting themselves ambitious targets for growth with many seeking to double AUM by 2025. To do this, firms need to retain existing clients, increase their share of the client AUM, and attract new ones. But more than this – they need to realise hug efficiencies or increase the number of advisors quickly. A tall task when experienced advisors are on the decline.

The key benefits of a hybrid client servicing model

Investing in a hybrid servicing model delivers many benefits for your business and could be the key to fortifying it for the future.

The ability to scale quickly and profitably: By leveraging technology, firms can onboard new clients more rapidly and with less friction. This not only reduces costs but also reduces company risk.

Improved compliance: Hybrid service models enable firms to provide a solution with compliance rule books and processes built in, protecting clients and the firm’s reputation. Advisors face numerous requests from their clients on a day-to-day basis. Whether a comparatively simple or more complex process, all ongoing servicing activities should reflect best practice policy and SLAs together with any related regulatory obligations.

Added flexibility and visibility for the client and advisor: Omnichannel delivery platforms provide an additional layer of flexibility and choice for clients. These platforms allow clients to access their account information, complete day-to-day requests and transactions using a variety of channels, including online, mobile, and in-person. This provides a more convenient and user-friendly experience that allows for a more intuitive, consistent client journey which can result in increased AUM per advisor.

Reduced operational costs: The downward pressure of margins means wealth management firms are keen to identify ways to minimise internal costs across the business. A client portal and a hybrid servicing strategy combine to deliver efficiencies across several business areas:

  • A reduction in the cost of client servicing: Using a hybrid service model removes manual, administrative tasks for the advisor and re-focuses efforts higher-value, revenue-generating activities. Research suggests that Digital First firms can serve a customer at around one third of the cost of traditional processes – in some cases a sixth.
  • Speed up completion of onboarding process : Hybrid service speeds up the onboarding process and delivers an enhanced experience. It minimises the attrition of clients which occurs during the traditional paper-based onboarding process and improves the time to revenue.
  • A greater share of wallet: Real-time tasks are generated based on prior and anticipated actions and or needs, enables advisors to unlock additional opportunities.

Increased Assets Under Management: By using technology to improve advisor productivity, firms can increase AUM per advisor, resulting in higher profitability. By leveraging all of these opportunities together, firms can create a significant competitive advantage.

Maintaining a Competitive Position

With increased competition from digital entrants, it is crucial for established firms to pivot to meet the needs of today’s clients. There’s an opportunity to provide a highly differentiated service with the convenience of digitalised processes to reduce the emphasis on manual, time-consuming activity. The extensive capabilities and automation garnered by FinTech technology offer substantial economies of scale, and for those seeking clients in the ‘mass affluent space’, a hybrid service model could confer significant opportunities.

The Wealth Management industry is facing some tough challenges, but with awareness and preparation, firms can stay ahead of the curve. By building a digital advice capability, enhancing lead flow capability, and integrating technology successfully, advisors can meet these challenges head-on and continue to thrive in the digital age.

To read more about how ‘Hybrid Servicing could Transform your Wealth Management Firm’ download our eBook today.

Download the eBook: How Hybrid Servicing Can Transform Your Wealth Management Firm


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