It’s hard to overstate the impact of technology on financial advisor-client relationships. As the industry changes, a great service experience is now just as important to clients as high-quality financial advice, and these days, technology is a major component of both. As a society, we are now accustomed to getting what we need when we need it. Amazon will deliver your groceries in two hours at no extra cost, Uber and Lyft no longer require you to hail down a taxi or book a car in advance, and Netflix allows you to binge-watch your favorite shows without commercials. Anything you need is just a few clicks away. This is our new normal and consumers now expect this to apply to their financial lives as well, particularly when it comes to communicating with their financial advisors.
But in a profession that was not “born digital,” adjusting to the new normal often requires behavioral change. However, for most people change is difficult, that’s just human nature. But it’s particularly difficult for successful financial advisors that might not already be tech-savvy or see the value in this shift.
Some financial advisors might not think that their clients actually want a more technologically enhanced experience. In fact many financial advisors believe that older clients are uncomfortable with digital communication. In our experience, the idea that only younger generations are tech-savvy is nothing more than a myth. Clients of all ages and income levels use services like mobile apps and video chatting: at Morgan Stanley, more than 75% of our ultra-high net worth clients use our online portal, Morgan Stanley Online, and clients over the age of 75 are just as likely to use it as clients under the age of 35 (Source: Morgan Stanley Wealth Management Analytics & Data as of March 2019). As clients become more familiar with this experience, Morgan Stanley financial advisors can more effectively communicate with their clients and add more value to the relationship.
At Morgan Stanley we’ve spent the past several years successfully helping our financial advisors adopt new practices. What we’ve found is that even among financial advisors who recognize the value of technology, change takes time, and requires a thoughtful, strategic approach by leadership. What follows are some of the key lessons we learned along the way.
Arm Them For Success
Once your team has bought into the process and the benefits that change can bring, make sure they’re equipped with the skills and tools to take action. You wouldn’t talk somebody into skydiving and then send them up in a plane with no instructions or a parachute!
The best way to galvanize change among the members of an organization is to involve them from the very beginning of the process. Give them a seat at the table and align the changes you’re asking them to adopt with their own goals and priorities. A great example of this is a tool we developed at Morgan Stanley called Next Best Action (NBA) that uses machine learning and data analytics to help financial advisors send relevant and timely information to many clients at once. These can range from operational messages, such as notifying clients of adding a trusted contact in their accounts, all the way to investment-related messages, including updating a client’s retirement plans probability of success in times of market volatility.
When it comes to putting new technology into action, it’s important to provide thorough training to ensure everyone is comfortable with the new tools. That can vary from in-person site visits and live demos to creating materials like video tutorials or written guides. After all, financial advisors and service professionals are on the front lines when it comes to successfully rolling out new technology to clients.
Cut Through The Noise
Even the best-laid plans can still go awry. The most advanced, client-centric new technology can be a failure if your financial advisors don’t believe it’s valuable to them. Like everyone else in our “attention economy,” financial advisors and service professionals are bombarded daily with information: social media, advertising, compliance notifications, new initiatives, and even emails about leftover bagels in the conference room, you name it. The first step in enacting behavioral change is cutting through all that noise to communicate to your team why things are changing and how it will make their lives better. So when it comes to communicating, focus on the three C’s: customization, credibility and consistency.