Members of the stockbroking and investment advice industry have provided overwhelmingly positive feedback on the SIAA 2023 Conference held in Sydney on 30 and 31 May.
The conference was a great opportunity to meet with experts and professionals from across the industry and listen into some insightful keynotes about the opportunities and challenges facing the stockbroking and investment advice industry.
A perennial challenge identified at the conference by Maria Lykouras, Chief Executive Officer at NAB-owned wealth manager JBWere, is that advisers are devoting excessive resources and time to regulatory changes diverting their attention and resources from areas where they can have a meaningful impact.
“We spend a lot of our time focused on regulatory changes. And actually, not being able to spend our money in the places that would make a difference,” Ms Lykouras said. “We’re very reliant on the technology that we use to support us but we’re not the quickest industry to move. I look at the way that consumer behaviours are changing and the way that they want to interact with us and particularly the way that the younger generation is going to want to interact with us. And I have yet to see that many players are really moving forward in that space and really trying to drive change in a way that is going to respond to the future needs of our clients,” Ms Lykouras said.
One of the opportunities that was identified as being able to assist with this challenge is the use of artificial intelligence. Jeff McMillan, Head of Analytics, Data and Innovation at Morgan Stanley Wealth Management gave a presentation of how advisers at his firm have been using an internally built AI-based tool called ‘Next Best Action’ for the past five years to facilitate personalised communication and recommendations for clients. Described as a ‘buffet of ideas to financial advisers’ the tool allows an adviser to pick up the phone and talk to their clients about those ideas or digitally engage their clients in scale.
As an example of how an adviser might use Next Best Action, Mr McMillan described a scenario in which the stock market dropped by 4 or 5 per cent.
“They could literally hit a button, and for every client that had a financial plan, they would be able to send a customised email saying, ‘Hey Matt, just want to let you know, the market was down 4 per cent, your portfolio was down – fill in the blank – 2.2 per cent, and that’s primarily driven by the following asset allocation, and based on my review of your plan, you’re currently over 90 per cent probability success, which is where we want to be. Have a good evening’,” Mr McMillan said.
The tool had been so successful that over 90% of the firm’s 16,000 advisers reportedly use it on a monthly basis not only to better service their top ten clients but to extend their service levels to their entire client base.
“By simply digitally engaging them on a consistent basis, you see higher net acquired assets, you see higher client satisfaction, you see higher retention rates, every metric,” Mr McMillan explained.
Next year, SIAA’s conference will be held on 14 & 15 May 2024 at the Grand Hyatt Hotel Melbourne.