Collaboration key to wealth management

Collaboration key to wealth management

The investment industry needs to harness technology that facilitates an evolved collaborative relationship between high net worth individuals and their financial advisors, according to the 2003 World Wealth Report published by Cap Gemini Ernst & Young and Merrill Lynch.

Providers failing to meet client demands for collaborative counsel will struggle to survive the new market realities, the study forecasts.

High net worth individuals (HNWIs) are defined in the report as people with financial assets of at least US$1million, excluding primary residential real estate.

Alvi Abuaf, vice president and leader of Cap Gemini Ernst & Young's North American securities industry consulting practice, says: "Harnessing technology is the key to facilitating the experience clients desire while simultaneously enabling financial advisers to offer a highly tailored and proactive service."

Providers must be able to build a comprehensive portfolio of services beyond stock selection and market timing to customise financial plans which incorporate elements such as financial goal setting, risk management, asset allocation and ongoing portfolio rebalancing, he says.

They must also integrate their channels, financial advisors, customer service representative, Internet and voice response units to provide clients with seamless access to their portfolios when and where they want.

"Beyond serving these needs, providers must address HNWIs' desire for a range of additional advisory services, from basic banking services to sophisticated tax planning, and trust and estate planning," Abuaf says. "However, to tailor these services to meet each client's individual requirements, providers must have an intimate knowledge of client characteristics. In that respect, HNWIs are looking for a close advisor contact characterised by two-way communication and rapid task-management and supporting technology."

James Gorman, president of Merrill Lynch's global private client group, believes the next generation of advisor workstations will be critical enablers for improving capabilities and efficiencies of the wealth management processes.

"They will support the complete relationship with clients, from acquisition to development to retention," says Gorman. "They will provide the advisor with a substantial platform of functionality - from comprehensive client relationship information to market news, research, proactive alerts and a vast array of products and services - to support all aspects of comprehensive wealth management. The next generation wealth advisor workstations will build a holistic client view that integrates previously stand-alone applications, thus improving client service and advisor productivity."

Donie Lochan, vice president in the securities industry consulting practice at Cap Gemini Ernst & Young, also suggests that providers will have to improve their current Internet offerings to build a more complete full-service experience.

"A full-service Internet solution provides clients with the self-service access to basic account information, while at the same time providing advisors with more opportunities to interact with clients on substantive matters through enhanced functionality, planning, transaction and information sharing, and other collaborative advice activities," he says. "The right online solution can improve profitability by reducing costs, improving advisor productivity and increasing client satisfaction."

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