Let's start with some troubling figures: according to recent projections, there are around 12 million Australians who say they have unfulfilled advice needs. The average adviser can work with up to 120 clients, and there are approximately 15,000 active advisers on ASIC's register.

You don't need to spend too much time running the numbers to determine that this works out to a pretty significant shortfall. In fact, Australia's "advice gap" was one of the primary issues that the recent Quality of Advice review was designed to address. We don't yet have all the details on how and when its recommendations will be implemented, but we do know that there's an appetite in Government to reduce the barriers between advice and the millions of Australians who need it.

Of course, regulatory reform can't be the entire solution to this problem. It's estimated that around $5 trillion in assets will be changing hands over the next decade in Australia, and the younger generations looking for advice on that wealth will have markedly different preferences for how advice is communicated, implemented and reviewed on an ongoing basis.

Put simply: the average adviser can expect a major shift in the demographic make-up of their clientele over the next decade, and their processes will need to adjust accordingly.

Generally speaking, younger investors have a greater preference for immediacy, on-demand services and "platform agnosticism" – that is, the ability to access those services on their phone, laptop, tablet or wherever else is required. They're also more comfortable with longer stretches of the advice relationship being conducted virtually, perhaps even mediated through chatbots and other automated tools.

Behind the scenes, it's generally expected that advice can offer global connectivity. Younger clients appear to have a less prominent preference for domestic assets, and may seek global diversification through digital assets and exchange-traded products.

For many advice businesses, the ability to provide this level of connectivity and immediacy will depend on how successfully they can leverage their technology partnerships. Which is why it's crucial that advisers start talking to their technology partners now: determine what your future business model looks like and ask them how they can work with you towards that goal.

It's important to note that the tech strategy for your business needn't solely focus on keeping up with changing consumer expectations. Effective use of data can also help advice businesses refine their offering and even service a wider variety (and greater number) of clients – going some ways to addressing the advice gap discussed at the outset of this piece.

Consider, for example, using a data-driven approach to client segmentation. How can advisers use the volumes of client data they already have to more effectively segment their client-base? Can this segmentation be automated?

On the investment side, could advice businesses generate machine learning insights through transaction modelling, historical trade analysis and prediction? And is there scope for using a ChatGPT-esque tool to field simple client (or prospective client) queries, informed by the information, education content and processes used in your business?

Many of these possibilities are already being explored in advice businesses right now – here and overseas. This is why it's so important to work with a technology partner to determine how you can integrate this kind of approach into your business. Assuming they have a reasonably-sized client base, they likely have a much broader view of how the industry is shifting, emerging operating models and new technologies on the horizon.

Preparing for the next era of financial advice may seem daunting – but it's not something you need to do alone.

Emily Chen, Iress’ Global Head of Product (Technology Platform), discussed this topic recently at SIAA 2023. You can watch the recording here.