In the ever-changing landscape of financial consulting, new trends emerge every year, allowing those who follow them to increase profit and optimize their workflows. 2023 has brought several key trends into the industry. Keep reading to learn what the trends are, how they are going to change the game, and how they are going to change the game and how they can benefit your company.
The state of the financial services industry
In the last decade, the growth of capital-intensive risk intermediation services has slowed down compared to connected data services and value technology services. This trend has resulted in the industry value of banks and insurance and asset management companies shrinking in proportion to financial infrastructure and technology companies.
Asset management companies and financial consulting firms are currently looking to find more points of growth. They are experimenting with providing new services to clients and actively investing in innovations to keep and expand their market positions.
Let’s check out the current trends that financial consulting companies are actively adopting or looking forward to implementing.
Financial advisory trends of 2023
In 2023, major financial consulting firms are actively investing in innovation, exploring hybrid workplace tools, and working on increasing transaction security. Furthermore, companies are realizing that using a single platform to store all business data and automated reporting is key to streamlining business operations. The rise of microservices is also a trend for companies that have their own custom software. These trends are at the forefront of financial consulting firms’ discussions this year.
Investing in digital innovations
Chris Howard's article "Innovating in Uncertain Times: Lessons from 2022” from Harvard Business Review has demonstrated that firms that keep their focus on innovation (especially those that invest in areas with relatively low opportunity costs) experience higher sales and profit growth than their counterparts during periods of economic instability.
That’s why 60% of companies plan to increase digital investments in the future, according to BCG’s Digital Maturity Global Study.
Let’s overview what areas of digital investing are the most promising for 2023.
Investment in superapps
By 2027, Gartner predicts that more than half of the world’s population will be utilizing multiple superapps on a daily basis. Furthermore, enterprise mobile and desktop experiences, such as workflow, collaboration, and messaging platforms, will be integrated into the superapp concept.
Currently, there are already apps that provide a streamlined experience throughout a digital workspace and have dozens of workplace tools integrated into one system. CXApp and a Super App by Codeless.ONE are two out-of-the-box examples that have already gained popularity. Some companies are also investing in building their own superapps that offer an all-in-one experience that includes basic functionality, dashboard integrations, and automated reporting systems specific for the wealth management industry.
Looking for software to help you scale your financial consulting company? Check out this list of 20 top solutions built to boost effectiveness!
Investment in AI-driven robo advisors
According to Javelin research, individuals with investable assets of $100,000 or more are learning to use third-party investment applications and websites, such as robo-advisory and self-directed platforms, to make informed financial decisions. They are also turning to AI-driven applications. Wealth management firms have to respond to this challenge accordingly by rolling out their own self-service robo advisor options. This is one of the important points of growth that shouldn’t be overlooked even though only 32% of companies are currently increasing investment in artificial intelligence because it is considered to be in its early development stage.
Despite significant investments in cybersecurity and an increasingly heightened awareness of the issue, reports suggest that the frequency of cyber incidents and the costs they incur continue to rise. Unquestionably, the growing technical expertise of hackers and other adversaries pose a difficult challenge. This is why cyber and information security has been identified as the primary area of increased investment for 2023 by 66% of CIOs surveyed by Gartner, with a projected growth in spending on this sector.
Kevin Armstrong, General Counsel and Chief Legal Officer at Docupace, has predicted that there will be three trends in cybersecurity in the wealth management sector in 2023. They are:
- ensuring a secure connection between home and office networks
- improved encryption for cloud-based platforms protection
- cryptocurrency wallet security measures
Investing in the best cybersecurity practices can help your firm stay ahead of potential attackers.
Hybrid workplace strategy implementation and remote work tools
There are three hybrid workplace strategies that currently are implemented in many companies: remote-first, office-occasional, and office-first. In 2022, with a tight labor market and a high rate of employee attrition, many companies called their workers back to the office, switching to one of these strategies. Naturally, this decision brought new challenges, such as:
- collaboration issues
- document management inconsistencies
- employee management struggles
- security issues
Because so many employees have become accustomed to working remotely, it can become difficult for them to stay in sync. Martine Haas, Wharton management professor, acknowledged in her interview that it isn’t possible to evaluate what hybrid strategy is the most effective and refine policies accordingly. She suggested paying attention to what tools might improve employee experience instead.
When choosing software that can potentially facilitate hybrid workplaces it’s important to look for digital solutions that provide:
- meeting room bookings
- team scheduling tools
- communication software
- cloud-based document management
- employee training apps
Looking for an all-in-one solution that will assist you with scheduling and booking within your team? Check ExpertBox!
One platform for all business insights and data standardization
Oracle statistics indicate that, although 68% of clients deem personalization to be significant, only 15% anticipate companies to actually fulfill their expectations. However, personalization has already become a marketing trend , helping companies increase client acquisition. By having more reliable, standardized data, it is possible to streamline the process of analyzing client behavior, identify patterns, and target and convert prospects more effectively, quickly, and cost-efficiently. However, because so many tools are used to collect and manage user data, inconsistency becomes the number one challenge to using personalization techniques. Data security is also an issue that arises when companies have to export and import information back and forth to various platforms to use it.
That’s why many firms and enterprises are looking for ways to build one multipurpose platform for all their business needs.
Providing detailed reports explaining monthly price fluctuations is one of the most automated activities in wealth management.
Financial consulting and wealth management companies are looking for new ways to make report generation easier and faster and are looking to use solutions that provide smooth integration with analytics to showcase detailed monthly, quarterly, and yearly reports. Automation can reduce routine work to a minimum, allowing team members to pay more attention to face-to-face client communication and other strategic activities.
The rise of microservices
Microservices have become a digital transformation trend for financial services companies, allowing them to break down their slow-moving, monolithic IT systems into multiple small, independent services that are highly decoupled and self-contained. By splitting applications into smaller, loosely coupled, and independently deployable services that stand separately from the core, microservices facilitate greater flexibility and scalability.
As a result, it becomes easier and more cost-effective to deploy separate features and implement new functionality in a business.
The challenges of implementing digital trends in wealth management
As industry trends continually evolve, it is important for wealth management firms to stay up to date with the latest technologies, which can require a large investment in implementation and training. Furthermore, integrating new technology into existing systems and processes is risky because sometimes it can be difficult to forecast how it will impact the whole business process.
Check out the top three challenges in digital trends implementation and learn what steps can help you resolve possible issues.
#1 Scaling new digital solutions
It can be complicated to switch from pilot solutions to full operations across the business. However, there are several strategies that can be used to overcome this challenge:
- Having a clear digital strategy that outlines the goals, objectives, and KPIs of every process undergoing innovation
- Using mature solutions and avoiding tools on early development stages
- Testing in iterations to understand how the solutions work
- Being ready for changes
By implementing these strategies, a wealth management firm can successfully navigate the challenge of scaling new digital solutions while remaining competitive in a rapidly evolving environment.
#2 Recruiting qualified tech talent
Wealth management companies looking to implement digital trends have a choice of either developing their own unique solutions from scratch or using the ones already on the market if they are adjustable enough to fit the company needs. In both cases, the firm will need to recruit qualified tech talent to form a team that has enough skill and experience to work on the tools they plan on developing" or "work with the tools they plan on using.
Most companies looking to invest in superapps or AI-driven robo advisors or planning to increase security have to decide if they need an in-house team or an outsourced team.
In any case, it’s important to have a chief technology officer who has a tech background and expertise in digital solutions in your niche and is able to supervise the team that your company will hire to build or scale an existing software.
#3 Prioritizing investment and development
In this article, we have mentioned the trending digital practices in the wealth management industry. However, it’s impossible to adopt all of them at once. To prioritize the solutions, you have to understand what results you want and which investment is the most strategically important for your business.
Despite all the challenges, many financial consulting and wealth management companies invest in digital innovations and are ready to adopt the latest technologies and best practices. Learn about ways to automate business processes and explore more tools that can streamline your workflow with ExpertBox! Subscribe to our newsletter to get the latest information.
These challenges often draw the line between success and failure in digital trends implementation:
- Scaling new digital solutions
- Recruiting qualified tech talent
- Prioritizing investment and development
These are the trends financial consulting firms are discussing this year:
- Investing in digital innovations
- Hybrid workspace strategy implementation
- One platform for all business analytics and data
- Automated reporting
- Microservices implementation
These areas are the most promising digital innovation sectors in 2023:
- AI-driven robo advisors