The data-driven wealth manager of 2030 has a huge opportunity to cater to the mass market. But challenges in the industry persist restricting progress. Its clear wealth managers understand the importance of improving data maturity but are faced a number of barriers. In part 1 of this series, we looked why the industry considers itself a laggard when it comes to data maturity and the challenges wealth managers face. Now we’ll explore how wealth managers can overcome these hurdles and build data maturity.

Five steps to build data maturity

There are five core steps that wealth managers need to ensure are in place before they can even start thinking about improving data maturity.

1. Establish a clear vision from the top of the organisation. Create a business strategy with data at its heart. Be ready to transform the company’s structure and mindset, and focus on using data to deliver better customer experiences. This is essential to ensuring the organisation can exploit the next wave of industry innovation.

2. Get the nuts and bolts in place. Establish the right tools and processes for data mastery. This task isn’t easy, but it’s really important to get right, because it lays the foundation for becoming a leader in the next generation of wealth managers.

3. Gather data – especially customer information. With the right capabilities and structures in place, wealth managers can ingest and capitalise on all available data channels - including from the Open Finance ecosystem. Doing this will help develop a granular understanding of each customer. They should collect whatever data will provide the most value. For example, that might mean ingesting real-time transaction data from current accounts to better understand customers’ spending habits.

4. Deploy intelligent analytics. The right tools can transform raw data into insights, recommendations and even automated actions. Consider the tools that will turn data into personalised service.

5. Look at everything through the lens of customer experience. Pulling all of these components together in a way that optimises the customer experience requires thoughtful planning. Design thinking and a customer-first mindset are key.

What to expect from the wealth manager of 2030

The holy grail of effective data exploitation will be personalised, multi-channel customer experiences that are constantly evolving. That means delivering the right blend of human and digital interactions to suit each individual’s needs. It means lowering the cost of service without lowering the quality of service. It also means recommending and tailoring products and services to suit each person’s risk appetite and financial goals in a way that is scalable.

Until now, wealth managers haven’t been able to serve large numbers of customers cost-effectively. However, this will change as increasingly sophisticated tools and analytics begin to make personalised, automated advice a reality. Trust will be key to getting this right - but trust is hard to gain, and easy to lose. As an industry, wealth management has a way to go to build a trustworthy reputation in the mass market.  As wealth managers start becoming more data-driven, they must actively focus on building a trusted brand with the needs of their customers at heart, while emphasising care and transparency around how customer data is used.

As companies get better at delivering high-quality advice automatically, relationship managers will be freed up to focus on building rapport and trust with clients. The role of wealth relationship managers is therefore set to change.