Australia is in the midst of a transformation, driven by demographic changes, social shifts, and technological innovation. The pandemic and lockdown life have accelerated our digital consumption to the point where there is no longer a divide between digital and rest-of-world experiences. We’re on the cusp of a $3.5trillion intergenerational wealth transfer from baby boomers to their children. There has also been an explosion in investors taking ownership of their money online, with 2021 seeing a doubling of investment app searches and 900,000 direct investors indicating their intention to join the market in the next year.

All of this highlights the imperative for the private wealth industry to be ready to adapt to changing expectations from clients, including a significant shift towards digital experiences. It’s no longer enough to simply build a website and expect investors to find you. Those firms that can harness technology to achieve operational efficiencies and scalably connect across all client touchpoints will emerge as the dominant players over the coming five years.

Making the best of your technology investment

If you’ve been waiting for the right time to take the leap when it comes to embarking on a technology transformation within your business, there’s never been a better time. Research has shown that investing in the right technology can make a considerable impact in reducing risk, driving down cost and bringing about operational efficiencies, enabling private wealth firms to free up time spent on administrative tasks and focus on parts of the business where human contact is vital.

But investment in technology isn’t enough. It is no longer sufficient to digitise a paper-based process and expect efficiency to materialise. The success of technology adoption is in utilising the tools and capabilities of the technology to evolve how you work. Private wealth firms need to understand how to successfully embrace and embed technology to create, and deploy, sophisticated and adaptable client propositions into a digital environment.

Successful change management involves the whole company, bringing everyone on the journey when setting out to implement new technology. It’s important to encourage a collaborative environment to mitigate scepticism or resistance and to invest in an ongoing approach to training and adoption for the team, long after the implementation stage is complete.

So, where to start?

1. Be clear on your objectives

Before technology is even a consideration, it’s critical to have a clear strategy. Too many businesses jump straight to the tools without fully understanding the problems they seek to solve.

Your strategy should include both quick wins and longer-term business goals. For example, improving back-office operations or ensuring ongoing compliance with regulations might be today’s priority, but over time this may change. Identify requirements for future enhancements and select technology that will grow with you. This will ensure your investment is relevant both today and into the future.

2. Assemble a cross-functional team

Having the right internal structures and ways of working in place is critical for any successful transformation initiative. It starts with the C-Suite, who need to walk the talk in leading the push for change, and empower project teams to assemble the right people to work collaboratively across teams.

That collaboration should also extend to your technology partner—co-locating teams where possible to drive tight alignment of goals and seamless knowledge sharing. However, finding the right internal champions is key—your technology partner can facilitate the process but they can’t lead it for you.

Internal communication and engagement are also critical—keeping your employees and partners informed from the outset will improve the likelihood of a successful adoption further down the line.

3. Breaking bad data

Data should be at the centre of any successful technology transformation—it holds the key to your clients, operations, and business intelligence—and is the heart of any organisation.

Too often, when it comes to technology transformation projects, bad data is the root cause of delays, and even failures. This usually relates to having disparate systems, or a lack of data quality and handling practices. While it might seem rudimentary, time put into reviewing, validating and cleansing data at the beginning of a transformation initiative is always time well spent. Unlocking the potential of your data is hard enough, and trying to cleanse the data you have during implementation and adoption activities is only going to delay the project, and put your objectives at risk.

Without good data, firms can’t automate or predict, and future opportunities for growth and profitability remain out of reach. Additionally, if a key driver for technology investment is reducing risk or managing industry regulation; access to real-time data is key. The journey of a thousand miles starts with a single step—and that usually means taking a closer look at your CRM to see what state your client data is in.

4. Do it for your clients

Oftentimes technology adoption is about improving internal efficiency, however, it pays to keep a keen eye on the desired outcomes for clients when identifying your technology requirements.

Whether it’s improving the speed and quality of the service you provide, enabling clients to have greater visibility or control over their finances, or being able to provide a broader range of services to new and existing client segments. Being clear on what success will look like for your clients can be helpful in choosing the right technology and prioritising work along the way.

5. Change, change, change

If you’re going through a digital transformation exercise, what you’re doing today isn’t going to be what you do tomorrow. This is ok, expected even, and organisations who manage change well, lean into the challenge and embrace the opportunity to try something new. Don’t underestimate the resources and time required to deliver change. Discuss your expected outcomes with your technology provider and recognise that transformation doesn’t need to happen overnight. Focus on continuous improvement to ensure you’re able to deliver value as you roll out the change, rather than working to a traditional waterfall approach where the benefits aren’t able to be realised until months—even years—into the project.

Successful change management involves the whole company, bringing everyone on the journey when setting out to implement new technology. It’s important to encourage a collaborative environment to mitigate scepticism or resistance and to invest in an ongoing approach to training and adoption for the team, long after the implementation stage is complete.

After implementation is complete, take the time to reflect. Tools such as user surveys, one-on-one feedback sessions, and seeking end-client feedback can all keep the conversation going.

Ultimately, it’s important to remember that you need to do what is right for your business. True innovation comes from incremental steps, born out of a considered strategy and supported by an open culture.

This article was originally published in the Stockbrokers & Investment Advisers Association (SIAA) monthly magazine - April 2022. Read this article here.