Reducing Friction In The Advisory Relationship

April 24, 2017

Streamlining Delivery

We asked HNWIs to rate on a scale of 0-10, with 10 being highest, how much effort they feel they need to put into interacting with their wealth management providers.

Clients who "generally follow advice and recommendations" indicated a personal effort level of 6.1 out of 10 in their advisory interactions, just 0.4 points lower than those who are completely self-directed, as shown below. With effort high for clients across the advisory spectrum, there is hardly much incentive to delegate more decisions as well as more of their wealth to advisors.


For a larger view, please click on the image above.


Partial delegators exhibit a clear preference for the integration of digital channels into their relationship management. Almost half of them prefer to use digital communications to interact with their advisors. In particular, they prefer online channels when it comes to receiving news and updates and reviewing market changes.

Furthermore, over 80% of them said they would innovate the quality of statements and reporting if they were in charge of their wealth management business.

Upgrading digital information delivery to provide a more streamlined information and communications management system could give wealth management firms an opportunity to meet these client expectations and reduce the effort that clients put into the relationship.

Enhancing technology will also become increasingly important to delivering value in discretionary relationships as the expectations of partial delegator clients rise. Indeed, a quarter of these clients expect risk suitability assessments on at least a weekly basis, something only achievable with technological support. The reward for wealth institutions is reducing the time burden when delivering insight to clients.


By thinking about the advisory spectrum—and the preferences of clients along it—advisors can better determine how to deliver an optimized client experience.

The effort that clients say they currently put into these relationship raises questions about the relevance of delegating relationships to advisors. But with an enhanced digital offer, advisors will be able to reduce friction points around information delivery and communication to more clearly demonstrate their value. 

Greg King is senior vice president of wealth management strategy at FactSet.


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