Today’s investor demands holistic financial engagement. While the wealth management industry has begun to use digital practices, most have focused their efforts on either the client-facing applications (front-end applications, platform-based tools, onboarding) or execution-oriented functions (legacy-system retirement, removal of manual processes, automation). It’s now time for firms to turn their attention as well to connecting these functions to create a richer and seamless experience.

In our recent report, “Rise of the New Wealth Platform,” we discussed why using analytics, machine learning and applied intelligence could unlock the trapped value of data and drive new growth. Another key component of the infrastructure transformation in wealth management is effectively connecting the client-engagement functions with the legacy broker-dealer functions. The right balance of integration and abstraction between client-facing and execution layers can be critical for incumbent wealth firms partnering with digital natives.

Some big players are already leading the way. Merrill Lynch has created a customer hub in its Merrill One platform by consolidating managed account platforms to give advisors complete information on their practice, their clients and the large universe of investment products through one view.[1] The system connects to more than 30 data sources, enabling advisors access to all their clients’ managed account information. TIAA’s MyVest brings automated daily reconciliation to its enterprise wealth management platform, Strategic Portfolio System (SPS).[2] This is integrated with the same database that powers SPS’ score functions like trading, performance measurement, reporting and billing.

To help ensure your future wealth platform is well integrated, the middle tier—known as the relationship layer or customer data hub—should be able to:

1. Abstract the record-keeping functions to support newer advice offerings unencumbered by back-office limitations

2. Provide a rich client profile, enabling a highly personalized experience across your client’s comprehensive financial picture

3. Become well integrated into your insight engine, delivering actionable intelligence to continue to deepen the engagement and trust of your client relationships

A middle tier that supports these three functions will be critical to enabling your differentiation in the market.  Your wealth platform investment should envision this middle tier as a foundation on which to scale and amplify your advice transformation.

If you are looking to build a better-integrated wealth platform, please email me, Scott Reddel. I would be happy to help you think through your challenges, navigate the solution landscape and share my thoughts on where the industry is going.

[1] http://www.wealthmanagement.com/technology/merrill-lynch-app-poses-threat-third-party-financial-tools
[2] http://www.investmentnews.com/article/20171213/FREE/171219959/tiaa-owned-robo-myvest-automates-middle-office-tasks

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