Digitize Me: The Evolving Client Experience

NICSA members learned about technological trends poised to transform the asset management landscape and how they can enhance the client experience during the 2018 General Membership Meeting last month.

Chuck Gallant, Managing Director at BNY Mellon, moderated the panel, which featured experts from BlackRock, DTCC, and Northern Trust.

Barbara O’Malley, Senior Vice President at Northern Trust, said her organization’s tech strategy is centered on creating a consolidated, optimized, and scalable ecosystem.

“We’re looking to digitize all activity coming into Northern — not just trades, but instructions, letters of direction, all those things,” she said. “We want to provide actionable insights and transparency into the processes themselves, and provide avenues to let clients interact with us how and when they want to.”

Jennifer Peve, Managing Director, Business Development and FinTech Strategy at DTCC, said her organization is exploring technological innovations ranging from quantum computing to the cloud and cybersecurity. “And we consider everything in between,” she said.

Peve said the ultimate goal is to use emerging technologies to enable new business processes and solutions.

“When we think about our digital strategy, clients come first,” she said. “But we also focus on having an overall understanding of the landscape; knowing the environment intimately; understanding its impact on our businesses and the ecosystem; and working with global regulators, policy makers, clients, and technology providers at scale.”

James Mackinaw, Managing Director, Digital Wealth, at Blackrock, presented his perspective from the distribution side of the industry.

“We’re identifying technology — either through a build, buy, or partner approach — that we think will better enable advisors or wealth managers to engage their clients more efficiently and manage portfolios more effectively,” he said. “Then we are taking those technologies, bringing them into market, installing them with the help of partners, and distributing them more broadly.”

COMMON CHALLENGES

O’Malley pointed to some of the organizational challenges her organization has faced when rolling out digital initiatives:

• Speed of technical evolution. “It used to be that you could pick a platform and be confident it will have a three to five year lifespan,” she said. “That is changing much more quickly, particularity in the AI space. Plan for obsolescence.”
• Integration with legacy technology.“Most of us don’t have the luxury of starting with a blank sheet of paper, but there are techniques to make integration less painful,” O’Malley said.
• Overlooking education.“Humans like routine — frequently we’ll have a new technology and not spend enough time on education, training, and buy-in.”

WORKING WITH VENDORS

Peve said if you want to evolve your client experience, look for startups employing newer technologies like machine learning and different versions of complex algorithms.

She noted that at DTCC, complex technology risk management procedures are required of new partners. “If you take a small startup firm that might have a really innovative idea, some really neat technology, but they don’t have the distribution channel, they need help in that respect,” Peve said. “They come to these larger financial institutions because they’re looking for that win-win partnership.”

More and more institutions, Peve said, are partnering with the industry instead of disrupting it as previously feared.

Mackinaw said patience is key to any digital initiative. “The reality is, we go through a series of soliciting feedback, understanding friction points, correcting friction points,” he said. “That organizational patience and buy-in is critical to a successful technology initiative, whether it’s installing something or delivering something.

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