Firms that have scalable and flexible technology “are the ones that are going to win" in the financial services space , Alpha FMC associate director, Joe Harris, has said.
Speaking at a MoneyAlive event today (April 17) on 'Embracing digital strategy to empower compliance and growth', Harris explained the FCA will “continue to be involved” in the financial advice market and that initiatives, such as the Advice Guidance Boundary Review, could lead to future services and propositions entering the market.
Therefore if firms can take these services onto the market quickly in a digital manner, they are likely to be successful.
“Taking your time and not being able to deliver something quickly to the market is going to really hamper progress so having a scalable and flexible model allows you to do that”, he added.
Harris spoke about other benefits digital transformation can provide, such as increasing client engagement and retention.
“We have been quite clear the level of engagement that clients can typically expect has been once or twice a year,” he said.
Harris argued that, by improving digital engagement, firms could increase the knowledge of a client, making them more trusting with their cash and therefore opening up the share of their wallet.
He also argued firms could break the link between client and the adviser so, if any advisers leave, firms wouldn’t lose the customer as well, thereby creating an increased client retention.
Additionally, Harris also argued that digital transformation allows the capacity of a firm’s team to service more clients.
He stated that this could be done by pushing tasks to the client.
Market issues
Harris also spoke about issues in the current digital transformation market, stating that, while there are a huge number of technology vendors that have moved into the market, they are not all integrating between themselves.
“What that means is you’ve got multiple technology components within your estate not speaking to one another,” he explained.
He identified this as “causing issues” in the market such as driving up cost in manual work and reducing the ability to provide a consistent and smooth client experience.
While Harris acknowledged that there are firms that are trying to solve some of these areas, he additionally argued that as firms can’t wait for the providers or the vendors to solve this issue for them.
“You have to take some of this on in-house,” he said.
“You’re not going to be able to bring in the value you want without having some form of control over your own technology space.
“We believe fundamentally that a differing architecture is required.”
tom.dunstan@ft.com
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