Best Practices for Driving Technology Adoption by Financial Advisors

How do you stand behind someone without looking over their shoulder? That’s the dilemma leaders in the financial services industry face as they encourage their client-facing networks to transition from traditional approaches to the next-generation of financial advisor technology.

Companies today are migrating from a legacy sales leadership and relationship management approach to one powered by sophisticated in-house analytics systems. Many of their competitors have rolled these out to their teams, including Merrill Lynch, Vanguard, Fidelity, as well as, giants of technology such as Microsoft.

It’s a delicate dance. On the one hand, you must adopt these new analytics tools if your organization hopes to survive. Big data is here to stay. Most large firms already have their own data scientists and dedicated analytics departments driving a new approach that is both more predictive and more prescriptive. It’s all about the NBA: next best action.

On the other hand, you have to reassure your team that this shift toward enhanced analytics does not signal eroding trust or a lack of confidence in their ability. You want to come across as a big brother who’s trying to help — not Big Brother keeping watch.

Pulling off that dance requires executing a second delicate two-step. You must convey a sense of urgency, particularly if you lack the resources of the mega-firms. Again, the fact that major players like those noted above have already adopted next-generation analytics shows that you’ve fallen behind and desperately need to catch up.

At the same time, you must be patient. As much as financial advisor tools have transformed the asset and wealth management industry, people remain the ultimate decision-makers. But people aren’t always rational—especially when they’re feeling insecure.

Sales Manager, Manage Thyself

For industry leaders, the first step toward guiding their financial advisors into this new technology-centric landscape is to take their own advice. Just as their teams need technology to support them in the field, managers need technical support in training their teams to do that.

Also, by introducing cutting-edge training tools and providing follow-up, you reinforce the idea that you and your team are all in this together. You’re not just giving them a new task and walking away. You’re adapting right along with them.

With the right approach to learning and enablement, you can:

• Refine messaging and make it more consistent. A collaborative, interactive approach that uses a continuous feedback loop will broaden your team’s knowledge base and sharpen your value proposition. Analytics provide credibility.
• Share success stories. Nothing overcomes skepticism and resistance to change quicker than positive results. Leadership needs to spotlight team members who are scoring with analytics and encourage them to serve as evangelists. Highlighting early-adopters who have found success with the aid of the analytics can accelerate the uptake from those resistant to change.
• Build confidence. A team that can articulate benefits with self-assurance and overcome objections without hesitation is a formidable one—particularly when they have the data to back them up. With analytics, you replace “I think so” with “I know so.”

Meeting the Challenge of Wholesale Changes

The change that requires the most artful touch during the transition to an analytics-based approach is the evolving relationship between asset and wealth management firms and their client-facing teams. Of all those in the sector, client-facing practitioners (be they wholesalers or advisors) are the most fiercely independent. They’ve succeeded by their wits, relying on their instincts and experience. And they will be reluctant to let some fancy new algorithm subvert their judgment.

Think “buddy movie” as you approach them. The client-facing practitioner is the grizzled cop whose years on the streets have earned them scars and respect in equal measure. You’re the whippersnapper fresh out of the police academy who has a degree in criminal justice. You rely more on research skills than shoe leather to crack the case.

At first, the grizzled street cop might be standoffish and resentful. It’s a tough front that masks a deep insecurity. They’re worried that you’re going to use your knowledge and sophistication to curry favor with the higher-ups in the department and push them out.

So go easy at first. Make it clear that your financial advisor tools will simply function as a complement to their years of experience. Listen to them. Show a little deference. And then, when the moment is right, use your analytics to show them how to find that last clue, that missing piece that completes the puzzle.

That’s when they’ll get it. They’ll see that you’re not trying to take their job away from them—you’re just trying to help them do it better, more efficiently and more productively.

Disruption Isn’t the ‘New Normal’ — It Is Normal

The friction created by the shift toward a more analytics-based approach to asset and wealth management is nothing new. “Disruption” is just a 21st century buzzword that describes a process that’s been happening forever. 2000 years ago, many traders no doubt fretted over the disruption that the Silk Road created. But the smart ones adapted and flourished. Asset and wealth managers who get comfortable with analytics can do the same.

To assist your team in reaching that comfort level, it helps to point out the many ways in which financial advisor technology has reshaped other industries and consumer experiences for the better. Take the recommendation engine as an example.

Ask your team members this: “Would you rather choose a movie based on a recommendation from an algorithm that analyzes the films that you like, or a recommendation from your cousin based on films that they like?”

Selecting the right financial instruments for your clients is more consequential than recommending movies. So why not leverage available financial advisor technology for that far greater purpose?

It’s also important for your team to understand that many of your clients are already using technology to do their own research. But information and knowledge are not the same thing. Some clients will tumble down the rabbit hole as they do their research and will need you to pull them out.

Think of all the people who now use sites like WebMD to research their own medical histories. It’s not that they’re trying to treat themselves. They just want to figure out the right questions to ask. They still rely on their doctors to provide the answers.

Your team needs to start seeing themselves as the doctor in this scenario. Analytics is nothing more (or less) than a tool designed to help them do their jobs better. It’s not a question of choosing either financial advisor tools or the human touch. It’s about combining both to create a whole that’s greater than the sum of its parts.

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About Joe Kringdon

Joseph D. Kringdon, principal, Kringdon & Associates/HMC, spent several decades in the wealth and asset management business, managing and leading both advisors and wholesaler investment consultants.