With digital disruption ripping through so many industries, wealth management is one of the many sectors experiencing radical change. A recent EY report on digital disruption in wealth management reveals that most high net worth entrepreneurs would gladly swap having a wealth relationship manager in exchange for better digital capabilities.
Digital disruption is expanding beyond retailing, high street banking and taxi hailing and is now impacting the professional classes, with a recent McKinsey report ‘Jobs lost, jobs won’ forecasting that robots will replace 800 million jobs by 2030. A recent competition by legal Artificial Intelligence platform LawGeex, in consultation with law professors from Stanford University, Duke University School of Law and University of Southern California, pitted 20 experienced human lawyers against an AI trained to evaluate legal contracts. They all read a series of non-disclosure agreements with deliberate loopholes included. The results showed the humans achieved an accuracy rate of 85 per cent and the AI 95 per cent. The humans took an average of 92 minutes to complete the task, the AI 26 seconds…
This may be a surprise for highly trained, highly paid lawyers, bankers and other professionals, but it shouldn’t be.
Our own work in wealth management, for instance, highlights that private banks, who have thrived on traditional skills and brand heritage in the past, are constrained by dated business models and legacy technologies. Most have simply not recognised the pace of change, let alone dealt with it, and whilst the writing may be painted in large letters on the wall, many don’t appear to be reading it.
Agile Fintechs and Silicon Valley giants are already cherry-picking high value services and may indeed reshape the wider wealth management playing field. The same is true in investment banking and legal services, where the low cost of accurate AI due diligence is just the tip of the iceberg. If the less nimble incumbents already see their antipasto is being eaten, it won’t be long before the whole lunch follows.
So what has branding got to do with digital transformation?
Well, it’s a much more significant component than you might first think and is a clear reflection of strategic intent.
First, good branding is about accurately defining and articulating Purpose – the reason your business, firm or organisation exists. Every vision and mission must align with this, so, in a real-time connected world, if your purpose is woolly, or is not articulated with clarity, how can you expect to achieve your strategic goals?
Second, our branding methodology is proven to be a catalyst for strategic change because it engages and motivates leadership teams in a rigorous process. This starts with de-constructing the business offering, before rebuilding it to meet customer needs, redefining and clearly articulating a new brand purpose and value proposition/s which ring true internally and places the needs of digital savvy customers at its core.
Third, we apply award-winning creativity and user experience design to bring brands to life, delivering world-class digital services to meet current and future demands, whilst using the whole transformation process as a spur for internal action by engaging and motiving employees.
The Digital Revolution and Wealth Management
Four overarching trends are disrupting the established order in private banking and wealth management. Together they are driving transformational change in a sector where client needs are changing, regulations are tightening and assets under management are rapidly expanding – generational transfer of wealth alone is estimated to be worth 4 trillion USD by 2030 – but will the asset managers of the future be human or robots? And what can brand strategy contribute to support the transformation of today’s private banks into tomorrow’s leaders in wealth management?
Download your own copy of this latest Nucleus Report