Client reporting has evolved alongside other aspects of the financial services industry. Currently, it is a function that is owned by “the business”, who design and distribute information per the requests or mandate they receive. Soon, it is likely that we will see a shift towards organizations providing a gateway to data, and the clients themselves deciding what they want to see and when they want to see it. This state has been reached and the next will be achieved through the on-going emergence of innovative and enabling technology.
In my previous blog, 'Clients expect better communications and reporting', I looked at how this evolution came about. As a result, an interesting debate has arisen. Maybe, the assumption of the next stage in the evolution has ignored crucial aspects of the human condition?
Stage 6 (ubiquitous computing) supposes that the evolution of reporting follows the currently expected path, where technology continues to dominate our lives, and continues to transform the industry. It’s difficult to argue against such a point of view but there is a danger here.
You are probably aware of the often discussed and widely accepted transfer of wealth that’s about to occur from the baby boomers to millennials and then on to generation z, who as we’ve been told, expect the same familiar technology that is in abundance in the rest of their lives. Who, as we are to assume, will spend the rest of their lives with their heads bowed towards the omnipotent presence of iOS or Android to satisfy all of their social and business interactions. Will their relationship with technology supersede the basic drivers of existence and survival?
Are we forgetting something crucial about the human condition? Are we letting sexy technology and its purveyors convince us it’s the only way to operate? Let’s briefly consider motivational theorists before I elucidate my point. Anyone who has studied any business theory has likely come across the names, Maslow, Herzberg, Alderfer and Taylor; some of the scholars who have presented widely accepted models of motivation.
Whilst there are distinct differences in their approaches and subsequent representations of what motivates us, there is a common theme that appears in most of them; that we, as human beings require interaction with each other to be happy. As we get older, and if we assume other needs are met, this desire or need becomes stronger. Of course, we can all probably accept that such interaction does not necessarily always need to be face to face but can we really be confident that wholesale replacement of physical and personal interaction with technologically-aided methods is the right thing for society, our industry or in fact, mankind?
The future of client reporting
The current expectations of the future of client reporting and communications in our industry suggest those who have wealth will not want personal interaction, as they’ll be satisfied with access to the data they want, in the format they want, and at the time that they want it. This though, contradicts the motivational theorists and possibly ignores crucial elements of the in-built coding of our species so I propose an alternate, slightly different viewpoint.
As an example, a chauffeur takes the responsibility, stress and hassle of driving away from their passenger. People engage others to provide services for them when skills are lacking or there is a trade-off with time or finances and this can be compared to wealth management provision. By evolving into the anything and anytime state, there is a risk that the service level provided by the wealth manager is diminished. As increased wealth tends to amass as an individual ages, it’s worth considering motivational theory that suggests that at the same time, increased importance will be placed upon valued and trusted personal relationships.
Practically, this means the evolutionary state being proposed in Stage 6 above will need to be provided but it cannot replace the aspects of the wealth management service that are sub-consciously desired by consumers. Frustratingly for the wealth manager, they will likely need to provide the data, to allow the client to access it on their terms, but they will still be responsible for summary, interpretation and analysis, over a nice lunch or a glass of pink gin.
…and then a driverless car will arrive to take them home.