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INTELLIGENT ONBOARDING: A BRIDGE OVER THE DIGITAL GAP FOR WEALTH MANAGEMENT

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By Mark Shields, Director of Solution Marketing

 

Transformation is most certainly afoot in the wealth management and advisory sector, with the pandemic accelerating some trends over others and highlighting the need for operational efficiencies. For wealth management providers this typically means a greater focus on digitalisation but also on streamlining processes to achieve greater productivity.

Recent research by ESI ThoughtLab confirms that digital services are an absolute necessity for wealth management providers, with 40% of investors reporting digital access has become a greater priority, and 9 out of 10 declaring that mobile will be their preferred channel in the future[1]: older, higher value investors are in fact now demanding access to digital too[2]. The same report highlights that digital transformation can increase productivity by 13.8% and revenues by 7.7%, highlighting that the race to automation will remain key to staying competitive.

There are some caveats, however, as with any change. Businesses will not be looking to replace systems entirely, risking downtime and getting involved in huge up-front investment. Instead, to achieve rapid results and Return on Investment (ROI), they are opting for simple, composable services that are lean, flexible to integrate and tailored to their environment.

Recent research by Forrester shows that one of the key areas where tailored solutions are providing important results is digital onboarding[3]. Specifically, orchestrated onboarding can reduce Not In Good Order (NIGOs) – documentation submitted with errors or omissions by 80%[4]. When the package of forms to open a new client account is created and submitted, missing or incorrect information will trigger a NIGO task which requires the advisor or other staff to correct and amend the package for resubmission. This task often requires the advisor to go back to their new client for additional information and evidence. NIGOs are therefore at the root of a cascade of negative outcomes that range from bad customer experience to productivity loss.

On the other hand, research shows that after introducing digital tools, work previously carried out by 35-40 staff can be successfully completed by a mere 10[5]. With less time spent amending documents, clients are onboarded faster, and resources are freed up to focus on more constructive tasks such as building trusted client relationships and winning new business. The study also shows that typical customer onboarding times are reduced by over 75%, from two days to between two and four hours[6].

By significantly reducing NIGOs accounts can be opened and funded faster, improving cash flow and client satisfaction at the critical ‘first impressions’ stage. Onboarding is a key stage in investor relationships and should not become a time-consuming sticking point, rather than the seamless and streamlined experience customers have grown accustomed to with more digitalised industries such as ecommerce.

Digital onboarding solutions that provide guided data gathering, leveraging specific business rules associated with the type of accounts, contribute to error reduction. More importantly, when these solutions are tailored to respond to national regulatory and compliance requirements, such as those defined by IIROC in Canada or FINRA in the US, they avoid the need to manually type up and prepare paper-based documentation. This is an important efficiency driver for operational staff and a way of reducing carbon emissions to meet efficiency targets: over 29 tons of greenhouse gas emissions can be saved over a four year period thanks to paperless workflows[7]. Integrations with other systems, such as CRM, book of records, and digital signatures improve efficiency as well as trackability and transparency of processes.

Finally, training new staff, can consume significant time and resources. Reducing that training onus by 80% with digital tools is clearly an exciting prospect for high-growth businesses[8]  that can thus upskill their staff to more valuable activity.

It is high time that wealth businesses joined other services providers in offering customers highly streamlined customer experiences. As onboarding is the very first interaction with the company, this is the ideal place to start. Research has also shown that improvements span much further than customer satisfaction: advisors that are no longer bogged down by paperwork are far more productive, compliance is guaranteed, and employees are more engaged and efficient. As the wealth management sector works to rapidly bridge the digitalization gap with consumer industry businesses, digital onboarding, especially when integrated with country-specific regulatory elements can provide a host of business benefits.

[1]  ThoughtLab | Wealth and Asset Management 4.0: How digital, social, and regulatory shifts will transform the industry (appway.com)
[2]  ThoughtLab | Wealth and Asset Management 4.0: How digital, social, and regulatory shifts will transform the industry (appway.com)
[3] Forrester for Appway, The Total Economic Impact of Appway’s Client Onboarding for Financial Services: The Broker-Dealer Segment, The Total Economic Impact of Appway’s Client Onboarding for Financial Services: The Broker-Dealer Segment.
[4] Forrester for Appway, The Total Economic Impact of Appway’s Client Onboarding for Financial Services: The Broker-Dealer Segment, The Total Economic Impact of Appway’s Client Onboarding for Financial Services: The Broker-Dealer Segment.
[5] Forrester for Appway, The Total Economic Impact of Appway’s Client Onboarding for Financial Services: The Broker-Dealer Segment, The Total Economic Impact of Appway’s Client Onboarding for Financial Services: The Broker-Dealer Segment.
[6] Forrester for Appway, The Total Economic Impact of Appway’s Client Onboarding for Financial Services: The Broker-Dealer Segment, The Total Economic Impact of Appway’s Client Onboarding for Financial Services: The Broker-Dealer Segment.
[7] Forrester for Appway, The Total Economic Impact of Appway’s Client Onboarding for Financial Services: The Broker-Dealer Segment, The Total Economic Impact of Appway’s Client Onboarding for Financial Services: The Broker-Dealer Segment.
[8] Forrester for Appway, The Total Economic Impact of Appway’s Client Onboarding for Financial Services: The Broker-Dealer Segment, The Total Economic Impact of Appway’s Client Onboarding for Financial Services: The Broker-Dealer Segment.

Top 10

Investing in workforce intelligence now, leads to an optimised tomorrow

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Michael Cupps (Senior VP, Marketing, ActiveOps) discusses four critical ways in which a new world of workforce data improves organisational function.  

As governments work rapidly to respond to the Omicron variant, businesses experienced its effects as a timely reminder that flexibility is an essential part of any attempt to open offices again.

Even in a hybrid work environment, the unpredictable nature of the world and people’s lives means that organisations will need workforce management methods and tools that are flexible and intelligent to make the transition a success.

As a result, it’s as important now as ever to look at how data is the key to getting direction during these changing times – and how some of the data requirements that might seem burdensome can be a source of optimisation.

 

Attitudes on workforce data are continuing to change with the times 

Michael Cupps

The pandemic has already forced a sea-level change in how operations managers understand their workforce and workload and plan their operations. While traditional workforce management data was based on looking around the office to get a sense of things and historical data around skills, schedules, inventory, and so forth, the pandemic left many operations managers in the dark as their teams worked remotely. Many organisations had already adapted to this change, implementing new methods of understanding productivity and performance and managing employees that were effective when working from home.

As hybrid working becomes the norm, the question remains for managers, where are my people most productive? Working from home is the preferred option for many employees, but not all of them – and not all types of work can be adapted to remote working.

More recently, other layers have started to appear that present a challenge to operations managers. One layer is eligibility – as in, who is allowed to work in an office or not.

Of course, US organisations will still be feeling the effects of the government’s attempt to enforce a nationwide vaccine mandate. Still, other countries are facing similar legislation – Western Europe is experiencing what can only be described as a ‘COVID-19 reality check’ when Austria became the first country to enforce a total lockdown since the vaccine rollout. The news of a rising number of cases has led to drastic actions from Schallenberg, with the announcement that Austria will enact compulsory vaccinations in early 2022, which has sparked violence in Vienna as tens of thousands of people protest the measures.

While vaccinations have been the key to the UK’s return to normality, nations that continue to struggle with controlling the virus will have an eye on Austria’s vaccine mandate and consequently fear that it will be a sign of what’s to come. With the ever-changing pandemic situation in Europe, businesses must prepare for the uncertainty.

If other Western European countries follow Austria’s example, vaccination mandates will inevitably add a new and novel challenge for businesses. Across every industry, management teams are already feeling overwhelmed. After two years of new variants, new vaccines, and new restrictions on the workforce, Austria’s mandate, as well as Biden’s Executive Orders in the USA, exemplify a new risk to the growing stability that vaccinations gave us.

Some organisations are implementing their own mandates regardless of national policy – the upshot being that, as a result, operations managers now need to know who is allowed to work in a particular location at any given moment. And of course, as the Omicron variant becomes more widespread and its effects are felt in society, organisations will need to rapidly adjust their plans to keep employees safe and comply with the law.

This can all feel very burdensome for operations managers: more data to gather, more lenses through which to look at workload, resources, and availability. But while there may be some initial pain associated with responding to these new requirements, I believe that they present an opportunity to create a more optimised future of work.

Understanding comprehensive workforce data can make business life more manageable. Thereby, it’s crucial to outline the four ways it contributes to a productive workplace.

 

1: It creates a well-balanced and engaged workforce

It’s no secret that your employees will have preferences for where they work. Understanding those preferences and factoring that into your planning can help ensure your employees are engaged in their work, improving productivity, well-being, and retention. If you can layer that information with data on employees’ performance in different environments, you have another part of the picture to help you balance your workforce. Of course, that data may need a third layer – who is eligible to work in which locations – and that needs to be handled correctly so that you comply with any local or national laws that are in force or will come into force.

 

2: It helps to reduce costs

This has already been discussed concerning the pandemic in a few places. As organisations move to hybrid working models, their need for office space reduces the costs associated with it. That could include rent, power, heating, water, insurance, and facilities.

But the cost argument goes beyond the maths of office space. Armed with the correct data, organisations can ensure that their people are working where they are most productive and happiest. That can reduce costs, mainly in decreased absenteeism, costing thousands of pounds per year.

That reduced cost could be used to help balance the books in a tight year – or it could mean that funds are available for training and coaching programmes that improve employee performance or even on rewarding high-performing employees.

 

3: It broadens the scope for your talent pool

Although gathering and analysing more data might feel burdensome, the truth is that it enables you to implement hybrid working models effectively and with confidence that they will deliver. And that means that you gain all the benefits of a hybrid work environment – including a vastly expanded talent pool. With minor roles a part of the norm, you can hire anyone from any country, allowing you to create more diverse and talented teams than you could before.

 

4: It can help make a positive contribution to sustainability efforts

Most organisations are considering reducing their carbon footprint and becoming more sustainable. If your organisation uses data to support a hybrid workforce, you should see a reduction in emissions on multiple fronts. You may see reduced emissions as fewer employees commute and those who commute less. You may see a reduced need for office lighting and heating – not to mention a reduction in office waste – as footfall in the office decreases.

The workforce data you gather to enable all this will help demonstrate a contribution to your organisation’s emission reduction programme – or could even form the basis of starting one if you haven’t already.

 

Availability is the new eligibility

It’s essential to start thinking about gathering data in a different light. Eligibility is arguably the most pressing (and stressing) requirement for organisations right now, and the temptation can be to find a solution that focuses solely on eligibility. But to take a broader view, eligibility data isn’t that different from the other data you’re gathering about employees and where they can work. You’re trying to build a picture of where your workforce is based – and eligibility is just one more layer on top of others, such as where your employees prefer to work and where they are most productive. When you consider the challenge in those terms, the uses for the data, you’re gathering suddenly expand. We’re calling the blanket term for this data “availability.”

Of course, gathering availability data – and indeed all the workforce intelligence that makes the four things I’ve mentioned possible – is the trick. In a hybrid world, that data needs to be gathered automatically, wherever employees are based, in real-time, to give managers as much detail as possible. But at the same time, organisations need to find solutions to prevent managers from drowning in data, which will prevent them from getting on with their jobs.

 

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Top 10

The future of retail trading

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Joe Jowett, CEO of StrikeX

 

The 2020s look set to be the decade of the retail trader. As the pandemic forced large parts of the globe to turn their bedrooms into offices, a new generation of mostly young traders and investors piled onto online trading platforms hoping to combat the doom and gloom of financial insecurity that hung over many at the time. This trend looks likely to outlast the pandemic itself and the considerable power of retail traders, at times making up over 20% of total worldwide trading volume, continues to disrupt the market.

As new trading platforms vie for users in an increasingly competitive environment, 2022 will pose a number of challenges concerning safety and accountability, while a consolidation of crypto and traditional asset trading looks likely. Tools like StrikeX’s own upcoming platform TradeStrike, due to be released later in the year, will ensure that trading and investing can achieve further democratisation and transparency, while enabling wider market access for both new and experienced investors.

 

Generation investor is here to stay

The skyrocketing growth of online trading platforms offering commission-free trading has fundamentally altered the demographics of the stock market. Research shows that the median age of new investors since 2020 is around 35, a significant reduction from pre-pandemic traders, whose median age was 48. Similarly, the average age of Robinhood’s 22 million users is 31, highlighting the fact that most online platforms are predominantly catering to millennials and Gen Z traders.

Joe Jowett

This dramatic shift in demographic, fuelled by easy access to online platforms with mobile apps and extensive social media networks on Twitter and Reddit, means that this new generation of traders and investors has a substantial influence on the market. This was seen at its most extreme in early 2021, when the subreddit WallStreetBets conspired to “short-squeeze” institutional investors who had bet against the ailing GameStop stock, causing headlines around the world.

While making money remains a priority for young traders, the sentiment behind the GameStop saga was one driven by a boisterous confidence that the traditional gatekeepers of the stock market could be swept aside, and a world previously shrouded in secrecy could be democratised and made accessible to the amateur investor. This same sentiment is shared by large swathes of crypto traders and investors, who believe in the transformative potential of decentralisation inherent in blockchain technology.

 

Lessons learned?

While online trading platforms like Robinhood enabled the GameStop rally, the decision to momentarily suspend trading of a number of so-called “meme stocks” caused millions of traders to lose their money and cast aspersions on the platform’s credentials of democratising the trading world. Hundreds of lawsuits concerning the episode are still pending and many users took to crypto and NFTs instead, where the blockchain-enabled peer-to-peer trading mechanics eliminate the need for intermediaries.

The GameStop saga has highlighted that trading platforms must prioritise accountability and transparency as part of their mission to benefit the retail investor. A trading platform with the unilateral right to restrict the trading of its users without prior warning will find it hard to win over a generation of investors and traders which values transparency and access above all else.

Further factors can play a part in providing broader access to new investors, including a clear breakdown of costs, such as withdrawal and order fees. As many online platforms have cluttered and complex user interfaces, these aspects are easily missed by beginners and can inhibit the accessibility to new users more generally.

 

Tokenisation is the future

One way to significantly democratise retail trading is the tokenisation of assets. Blockchain technology is seeing a wave of adoption across multiple sectors, from digital art and the metaverse to asset finance and real estate. As is demonstrated by the world of NFTs, any asset can be tokenised to establish an immutable and transparent record of ownership on a blockchain. Tokenising shares in stocks, bonds or commodities can completely transform the way we trade and offers the transparency and security lacking in many existing platforms.

One of the benefits of tokenisation is the possibility to trade 24/7, regardless of stock exchange cycles. As transactions can be recorded on the blockchain even when markets are closed, users can trade irrespective of their time zone, opening the market up to a wider base of traders and investors across borders. Further, blockchain automation allows for maximised transaction speeds with minimal transaction fees, while any information stored on the blockchain is accessible and verifiable by all, taking data ownership out of centralised control.

One of the most transformative benefits of tokenisation is the possibility to trade all assets, from stocks and commodities to crypto and NFTs, on one single platform. Juggling multiple portfolios on various exchanges is a significant entry barrier, as traders can lose sight of their investments. Tokenisation removes this barrier and opens the market to new users wishing to invest in both crypto and traditional shares. Finally, tokenisation allows for fractionalised shares, making diversification possible at lower costs.

 

A future-proof platform

At StrikeX, we are developing a solution which delivers on the benefits of tokenisation, while offering a transparent and user-friendly product to its users. Our flagship platform TradeStrike, due to launch later in 2022, is developed by retail investors for retail investors and offers tokenised assets, including stocks, NFTs and real estate, as well as cryptocurrencies, all in one unified interface.

TradeStrike will enable users to access the widest possible range of assets and 24/7 trading across borders will open up the market to a whole range of new traders who had previously been restricted from investing. Complete with a clean and intuitive interface and a range of educational tools, TradeStrike is designed to empower retail traders to make the best decisions based on clear and transparent information.

Online trading platforms have seen a monumental growth in recent years and have enabled a new wave of investors to access a previously safeguarded market. The year ahead will show whether these platforms are equipped to deal with challenges such as transparency and accessibility. One thing is clear: Generation Investor has changed trading for years to come.

 

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