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What role can technology play in the advice process?

This article is part of
Guide to how advisers are using technology

What role can technology play in the advice process?

There are not too many industries that remain untouched by the advance of technology.

But much emphasis has been placed on technology’s ability to transform the advice industry, both for advisers and their clients. 

While some technology has the ability to shake up the industry and streamline the delivery of advice, it also has its limitations.

Anthony Morrow, chief executive of evestor, remarks: “Using technology in financial advice is no longer a question of should we; we need to, as it is expected. 

“It still makes me smile when I see a press article about some institution launching an app, or something, and it being heralded as groundbreaking. In most industries not having an app or a mobile channel would pretty much kill the business.”

He confirms: “It’s a necessity, not a nice to have. Finance should be no different.”

The question is, are advisers embracing technology and, if so, how are they putting it to use in their businesses?

In answer to the first question, John Diehl, senior vice president of strategic markets at Hartford Funds, believes the assumption that advisers are “anti-tech” is inaccurate.

“The key to technology is efficiency and so there are many things advisers used to do manually that now can be expedited more efficiently by the implementation of tech,” he says.

Scott Gallacher, chartered financial planner at Rowley Turton, lists: “Whether it’s risk profiling, investment analysis, researching products, producing illustrations or making applications, technology is now essential through almost all of the advice process in allowing advisers to deliver accurate, up-to-date and efficient advice to their clients.”

He observes not only are financial advisers using more technology, “but we’re also seeing more and more integration between the different parts of the advice process”.

“[This is] perhaps best illustrated by the robo-adviser propositions which, despite some limitations, will go some way towards helping to close the advice gap,” Mr Gallacher suggests.

Time to focus

The words ‘efficient’ or ‘efficiency’ are commonly used by commentators when talking about the use of technology in financial advice.

Rob Gagliardi, digital product and propositions manager at Bravura Solutions, explains: “In the past few years, technology has had a growing impact on the financial planning and advice profession, predominantly through delivering operational efficiency, automation of administrative tasks, reducing risk to advice firms and opening up a wealth of benefits to clients.”

He believes the increase in operational efficiency and the reduction in the administrative burden placed on advisers are where the impact of technology has been most keenly felt, “as it allows advisers greater time to focus on what they’re being paid to do – talk to their clients, understand their needs, wants and outcomes, and provide quality advice”.