What does a day in the life of an advisor look like in today’s world? The events of the last two years have completely transformed how advisors think, engage and work.
Future-focused advisors have an opportunity to position themselves as multi-generational partners with the ability to deliver holistic, goal-based financial advice for the present and the future.
However, the advisor of the future will need to deftly navigate an environment filled with M&A, changing technology, talent wars and an ever-increasing focus on diversity, equity, inclusion and relationship building.
How can advisors set themselves up for success?
Here are five trends reshaping the industry of financial advice, and how advisory firm leaders can stay a step ahead to leverage industry transformation for growth opportunities:
1. Growth-Fueled Consolidation
Advisory firms have seen tremendous growth over the past few years, and as a result, have taken opportunities to assess new opportunities like mergers or acquisitions.
Numerous firms and consultancies, including DeVoe & Co., Echelon Partners and others, report that last year was a record year for M&A in the advisor space in terms of both the number of transactions and the volume of client assets.
Barring any stunning economic shock, this should continue in 2022, meaning additional smaller boutique firms will be rolled into bigger ones looking to achieve scale, bolster cybersecurity and help with regulatory compliance matters.
This is fueling a hub-and-spoke model with national brands pushing information and products down to smaller players. Advisory firm leaders will need to be uber-focused on simplicity and discipline when it comes to unifying tech stacks and operational processes, and eliminating outdated, complex systems and methods of doing business.
2. Technology to Optimize Client Experience
As advisory firms join forces and integrate core components of their tech infrastructure and tools, they have an opportunity to drive end-to-end improvements that will ultimately improve the entire client experience.
A strategic approach to planning and implementing technology changes can help drive more thoughtful decision-making about what can be automated, what has to be customized, and what can be scaled out depending on client needs and assets under management.
This is no easy task, and one that will require strong leadership, deep expertise (both in-house and through strategic partnerships) and a multi-year execution plan. However, with the right approach, advisors can ultimately spend less time figuring out technology and more time focusing on business.