The famous demographer and futurist John Naisbitt wrote the seminal book “Megatrends”in 1982. In it, he and his research teampredicted various outcomes for thefuture of societies worldwide based oncurrent events.
His methodology? Reading magazine and newspaper articles as researchinto how demographic changes, technology improvements, globalization andtheir trajectories would transform howwe all live our lives. This body of workturned into Naisbitt’s 10 predictions forwhat to expect, and most academics andresearchers agree that his prophecieswere spot on and still are playing outnearly four decades later.
Re-reading his prophetic tome duringthe quarantine sparked my own curiosityabout the future of wealth management.So, I recently took a similar approach toresearching this topic with a much betterand more powerful research tool: Google!
Compiling the results of my searches,I uncovered four megatrends in wealthmanagement that should have a profoundimpact on how the industry will be transformed in the years ahead.
Technology improvements and advance-
ments have been much more exponen-
tial since Naisbitt’s time in the early
1980s, and nowhere has that played out
more than in how information is stored,
processed, analyzed and delivered. The
evolution in operating systems — from
DOS to Windows and then to Cloud-
based and now Cloud Native — shows
the accelerated progression for informa-
tion technology infrastructure as new
methodologies, computing power and
data models get better.
Instead of business applications beinginstalled on servers or PCs, or accessedthrough the Internet, Cloud Nativemeans that the applications that drivebusiness and the data needed to processthem are all deployed inside a Cloudsystems’ architecture — hence the nameCloud Native.
With Cloud Native technology powered by such tech titans as Amazon WebServices, Microsoft Azure and GoogleCloud, the power, efficiencies, securityand flexibility provided are exponentialand bring new hope to the disparate technology stack that is wealth management.
Instead of a bunch of stand-aloneapplications all loosely connected via APIintegrations to pass data back and forth,Cloud Native technology lets the infrastructure seamlessly unite these applications and data in one environment.
The benefits of Cloud Native technol-
ogy are transformational, and it soon will
get rid of the many manual, clunky and
painful workflows that are constraining
the capacity of financial advisors, which
limits their growth.
This will provide the scale needed foradvisors to work with more clients on acloser, more personal level. It will free upadvisors from the day-to-day administrative tasks, so they can finally spend themajority of their time on clients and theirbusinesses, instead of on their systems.
Wealth management is a relationshipbusiness. Accordingly, in-person, one-on-one communications and interactions have been the go-to approach foradvisors to meet with prospects, convertbusiness and nurture client relationships over time. Behavioral finance tellsus that a human-to-human approach isthe key differentiator when it comesto personal issues like money and whyinvestors are more than willing to pay apremium for financial services from anexpert professional.
But what happens as we move through(and then hopefully past) the coronavirus,because many of these in-person interactions could be months if not years away?
By Timothy D. Welsh
Four ‘Must Watch’ Megatrends in
The pandemic might have accelerated some of these moves, but the
industry was already headed there.