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July 8, 2020

Technology key differentiator in adviser satisfaction, says study

A study by J.D. Power finds that technology investments will play a key role in capturing and retaining adviser talent in wealth management firms. However, only 48% of the adviser respondents said that the core technology provided by their firm offers is “very valuable” and providing satisfaction.

The J.D. Power 2020 U.S. Financial Advisor Satisfaction Study polled 3,262 employees and independent financial advisers from January through April 2020.

The study measures adviser satisfaction based on these six factors – compensation, leadership and culture, operational support, products and marketing, professional development, and technology.

Of those polled, majority (92%) said that they depend on technologies offered by their firm.

These technologies support various areas like core planning, portfolio allocation, portfolio management and customer relationship management.

The study also reveals low levels of adoption for predictive analytics tools, including AI-based technologies by advisers.

At present, only 9% of the advisers use AI-based technologies.

The satisfaction with AI technology was found to be 95 points higher than basic planning solutions.

The study also revealed technology satisfaction higher with platforms having complete integration than platforms that do not have it.

However, only 21% of the advisers said that their platform is completely integrated with single sign-on, data-synching and workflow features, among others.

J.D. Power senior director of wealth and lending intelligence Mike Foy said: “Adviser reliance on technology to manage all aspects of their practice has been growing for many years, but it has been accelerated considerably during the COVID-19 pandemic.

“While firms are investing heavily, many have been missing the mark on delivering technologies that truly meet adviser needs.”

In another study, investor satisfaction with dull-service firms has reached an all-time high, despite coronavirus concerns.

This is according to the J.D. Power 2020 US Full-Service Investor Satisfaction Study. However, it also warns that period of volatility, such as the Covid-19 outbreak, have historically hindered investor satisfaction.

RBC topped the ranking with a score of 873, followed by Fidelity (865) and Edward Jones (860). Charles Schwab and Raymond James completed the top five, both with 857.

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