Digital Transformation in Wealth Management: A Beginner’s guide - Part 1

Wealth management firms that have reached a high level of digital maturity have observed enhancements in various crucial performance measures.

Specifically, these firms have experienced a 13% rise in productivity, resulting in an 8% increase in assets under management (AUM) and a nearly 8% surge in revenue. Additionally, they have achieved a 7.3% expansion in market share and improved shareholder value by almost 6%.

What’s digital transformation?

You know how your grandma used to carry a flip phone?

And then smartphones came along and she was like, “What is this thing? How do I use it?”.

But now, she’s probably using emojis and texting you all the time, right?

That’s digital transformation! It’s all about old processes and ideas that are being transformed with technology.

And here’s a boring but necessary way of explaining it:

Digital transformation in wealth management is the process of using technologies to optimize existing processes and create new ones to:

  • Increase efficiency

  • Reduce costs

  • Improve the customer experience

  • Automate repetitive tasks

  • Limits manual processes, therefore less human errors.

  • Ensure KYC compliance

  • And a LOT more

Top 5 reasons why you should care about digital transformation in the wealth management industry:

Changing Client Expectations: Clients want access to digital channels for managing their investments and communicating with advisors.

According to a ThoughtLab survey, 89% of investors prefer to use mobile apps to manage investments and communicate with their advisors. (Source: ThoughtLab)

Cost and Fee Pressures: As clients become increasingly fee-conscious, financial advisors must find ways to provide value and transparency.

According to a study by Cerulli Associates, 69% of investors prefer lower fees, and 61% want transparency in fees.

(Source: Cerulli Associates)

Competition from FinTech: Robo-advisors and other digital wealth management platforms are gaining in popularity and market share.

According to a report by McKinsey, the assets under management (AUM) of robo-advisors are expected to reach $16 trillion by 2025.

(Source: McKinsey)

Access to New Client Segments: Digital transformation can help financial advisors reach new client segments, including younger investors and women.

According to a report by BlackRock, women control $72 trillion in assets globally, and they are looking for advisors who understand their unique needs and preferences.

(Source: BlackRock)

Improved Efficiency and Productivity: Digital tools and platforms can help financial advisors automate routine tasks and focus on high-value activities, such as relationship building and strategic planning.

According to a study by Aite Group, the use of digital tools can increase advisor productivity by up to 30%.

(Source: Aite Group)

Benefits for advisors (with a touch of humour)

Improved efficiency

Digital tools can automate time-consuming tasks. So you can finally have a robot do the dirty work so you can focus on what really matters: schmoozing with clients and giving them that sweet personalized advice.

Better data management

Digital platforms help advisors learn more about their clients than a psychic at a county fair.

By analyzing client data, advisors can give them the personalized service they deserve without resorting to crystal balls and tarot cards.

Increased accessibility

Digital channels enable advisors to reach clients anytime and anywhere, making it easier to connect and provide support.

It’s like a superhero hotline, but instead of fighting crime, you’re fighting financial chaos and confusion!

Enhanced client experience

With digital tools, you can give your clients a more personal touch than their favorite barista, making them trust and stick with you like gum on a shoe.

Competitive advantage

Adopting digital tools and practices can help advisors stay ahead of the curve and differentiate themselves from competitors, ultimately leading to growth and success in their business.

Or in other words. It will help you stand out like a flamingo in a flock of pigeons.

Of course, without real-world examples, learning remains theoretical and lacks the practical applications that enable us to apply what we have learned.

That’s why we’ll dive into Morgan Stanley’s digital transformation journey 👇

Real-world example of digital transformation

One of the most notable examples of a wealth management firm that underwent a digital transformation is Morgan Stanley.

The investment bank and wealth management firm recognized the potential of digital technology to enhance its services, streamline its operations, and improve the client experience.

As a result, Morgan Stanley invested heavily in digital transformation initiatives, and the results have been impressive.

Digital advisory platform

Morgan Stanley’s digital transformation journey began in 2013 with the launch of its digital advisory platform, Morgan Stanley Access Investing. This robo-advisor provides automated investment advice and portfolio management to clients.

Access Investing uses algorithms to determine an investor’s risk tolerance, investment goals, and investment horizon and provides customized portfolios designed to meet those goals.

Digital wealth management platform

In addition to its robo-advisor platform, Morgan Stanley has also invested in other digital initiatives. The firm launched its digital wealth management platform, Morgan Stanley WealthDesk, in 2018.

This platform provides financial advisors with tools to manage their clients’ portfolios and monitor their progress in real-time. The platform also offers clients a digital portal where they can access their account information, monitor their portfolio performance, and communicate with their financial advisor.

Mobile app

Another important part of Morgan Stanley’s digital transformation strategy is its mobile app. The app provides clients with easy access to their account information and allows them to make transactions, track their portfolio performance, and communicate with their financial advisor. The app also includes features like biometric login and two-factor authentication to ensure the security of client information.


Morgan Stanley’s digital transformation has had a significant impact on the firm’s business.

The firm has seen an increase in client engagement and satisfaction due to the convenience and accessibility of its digital platforms.

Overall, Morgan Stanley’s digital transformation serves as a prime example of how a wealth management firm can leverage technology to improve its services and grow its business. The firm’s investment in robo-advisors, digital platforms, and mobile apps has helped it stay ahead of the curve in an increasingly competitive industry.

💡In 2020, the firm reported that its digital initiatives had helped increase assets under management by 20%.

Source: Mckinsey

How to make change happen at your firm

“Having an owner mentality means treating your work like it’s your own business. It’s about going above and beyond to deliver results and adding value to everything you do.” - Simon Sinek

Naturally, if you made this far, you know more about digital transformation than the majority of people in your industry.

But how do you convince other people you work with to jump on the bandwagon?

Fear not, we have some witty and smart tips to help you win over even the most stubborn colleagues.

Speak their language 🗣️

Start by framing digital transformation in a way that resonates. If they’re all about the bottom line, focus on the potential for increased profits and efficiency.

If they’re all about the clients, emphasize the benefits of a seamless, user-friendly experience. Whatever their priorities are, make sure your pitch speaks directly to them.

Show them the numbers📈

No one can argue with cold, hard data. Compile some statistics on the benefits of digital transformation in wealth management, such as increased client retention and acquisition, reduced costs, and improved operational efficiency. Present these numbers in a compelling and easy-to-digest format.

Make it personal 📖

Share a personal anecdote about how digital transformation has impacted your own work. Maybe it’s a story about how you were able to quickly and efficiently respond to a client’s needs using a digital tool, or how automation has freed up more time for you to focus on higher-level tasks. Whatever the story, make it relatable and memorable.

Take them on a virtual tour 📲

If your boss is more of a visual learner, take them on a virtual tour of a digital wealth management platform. Show them how easy it is to navigate, how intuitive the user interface is, and how seamlessly it integrates with other tools and systems.

This will give them a better understanding of what digital transformation looks like in practice.

Use FOMO 🔐

Digital transformation is exciting! It’s the future of wealth management, and it’s happening now. Tap into your boss’s sense of adventure and innovation by framing digital transformation as an opportunity.

Talk to an industry expert ☎️

The future is here and it’s digital. Don’t let your wealth management firm get left behind.

Schedule a Q&A call with a digital transformation expert today to better understand your options.

Elie Najm
Digital Marketing Specialist | Spécialiste du marketing numérique