Relationships key to competing with automation
Financial advisers and planners have to forge and maintain strong relationships with clients to differentiate themselves as automation increasingly replaces the process work.
That is the view of Paramount Wealth Management principal Wayne Leggett, who believes that with the advent of robo-advice and the improvement of programming technologies, there is no question that this sector will thrive.
"I see that in the medium to longer term, relationships will be the only real value in what financial planners bring to the table because automation will replace more and more of the process work that we do and the strength will lie in the relationship-building and the strategic advice that we offer," he said.
Leggett added that if an adviser's only services are execution, portfolio construction and management, then robo-advice would present a risk to the profession.
"But that sort of functionality isn't going to help you in terms of any kind of strategic advice as to analysing alternative strategies and mapping out a financial program for the medium to long term."
Advisers can use robo advice for portfolio compilation and management to make their offer more efficient but that is at the end of the process, not at the start of it.
"I think it's that hand-holding if you will, that's what we bring to the table. When people need the comfort of talking to a human being, that's when we really earn our stripes," Leggett said.
AUTHOR
Malavika Santhebennur
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