In the realm of financial advice, the role of technology providers can often lead to a fragmented approach, likened to assembling a jigsaw puzzle without the benefit of the full picture on the box.
This disjointedness arises from the specialisation and segmentation inherent in the financial services technology sector.
Each tech provider or service - be it attitude to risk questionnaires, suitability report writing, back-office systems, or investment platforms - often operates independently, without comprehensive coordination with others, in fact imposing barriers to prevent progress.
As a result, the overall financial journey for the client can become a series of disjointed parts rather than a cohesive whole, making it more difficult than needs be to assess all aspects of their financial situation, create a coherent plan and fulfil consumer duty standards.
If the piece doesn’t fit
The lack of integration among tech providers can lead to several issues:
- Conflicting data and insights
- Duplicated efforts and costs
- Gaps in service
All of these can cause problems for advisers and clients.
Using pieces from different jigsaws
Because financial advisers often do not have the benefit of a single, cohesive technology solution they use a patchwork of tools from various providers instead, much like assembling a jigsaw puzzle using pieces from different boxes.
Each provider contributes their piece, but without integration, the pieces will not fit together well.
It should not be one-size-fits-all: adviser firms are different and offer differing perspectives to delivering the client journey.
Understandably there needs to be some uniformity to the product design, but without the flexibility and integration the results are limited.
Look at the front of the box!
To address these issues, I implore them to take a step back and look at the picture on the box.
It’s about time they took a more holistic approach to financial advice technology and were open to more fluid integration.
Here are some ways this can be achieved:
Centralised technology platforms: Having a centralised platform that integrates all aspects of the client's financial situation can help ensure that all tech tools fit together. This platform can coordinate with various tech providers to ensure their tools align with the overall strategy.
Interoperable systems: Financial advisory firms are increasingly seeking tech solutions that are interoperable, allowing for seamless data flow and integration between different tools. This interoperability ensures that data from risk assessments, suitability reports, and back office systems all contribute to a unified financial strategy.
Comprehensive software solutions: Advanced financial planning software can integrate different aspects of financial planning. These tools can provide a unified view of the client’s finances, allowing advisers to see how different strategies impact the overall financial picture.
Regular tech audits and updates: A cohesive financial tech stack should be regularly reviewed and updated to reflect changes in the client’s situation and goals. This ongoing process ensures that all pieces of the financial puzzle remain aligned over time.
A helping hand
It would be naive to highlight these issues without of course mentioning the role AI can play in meeting these requirements by ensuring that financial advice is not only comprehensive but also client-centric.
