Not according to business leaders, who say while those who don’t make use of the opportunities the technological revolution offers us will be left on the shelf, they are clear that man must work with machine to ensure we get the best out of our business.
Take the contentious and much-discussed field of robo-advisers, for instance. Many in the financial industry have expressed the view that robo advice will soon replace the need for face-to-face dealings with a financial adviser.
Others, however, have dismissed its use as something only fit for younger clients with fewer assets to manage.
The truth is, as always, somewhere in between.
For the uninitiated, a robo-adviser is an online wealth management service providing automated, algorithm-based portfolio management advice without the use of human financial planners. They use the same software as traditional advisers, but usually only offer portfolio management and do not get involved in the more personal aspects of wealth management, such as taxes and retirement or estate planning.
According to a recent study on innovative adviser behaviour, published by Jefferson National, those businesses currently using robo-advice are using it for clients across the board. Indeed the report says 52% of advisers currently using robo-advice say they most often use it for clients with more than $1 million to invest and 20% say they use it most often for clients with more than $10 million in investable assets. In addition, the study also found 49% are using it for older generation clients, the same percentage as those using it for their younger charges.
The conclusion the report draws is that the most successful advisers are open to adopting technology in general earlier and that includes, but is not restricted to, robo-advice.
Jefferson National’s CEO Mitchell H Caplan commented: “While there is no replacement for the value of holistic guided advice, our research demonstrates that this new generation of digital advisory solutions can be incorporated into a successful advisor’s practice to create greater efficiencies – and create more value for their clients. The most successful advisors understand that rather than a threat, robo-advisers are in fact an important part of a comprehensive offering.”
The message is clear: we need to embrace technological change and build it into our working practice in order to progress.
For instance, rather than enslave us to a certain way of working, technology could allow us greater freedom at work. In particular, it may allow us to break free of the physical ties of the office.
In future, engaged organisations will use technological advances such as holograms, as well as displays which will allow us to both interact with our environment as well as our computing system, to free staff from the confines of a particular building. It will mean the flexibility of working effectively in any environment. Inevitably, this will mean a better work/life balance for staff and a lot less commuting.
Many believe that, as a result, we’ll move away from the central business districts to a situation in which we will work more locally. This will challenge the corporate office, which we can expect to become a smaller operation used for different activities.
On the other hand, a freer rein may also entail the reduction of managerial roles. Businesses may rely more on algorithms taken from big data to distribute and manage the workload.
Nevertheless we shouldn’t be thinking in terms of us versus the machines, and instead concentrate on how we can harness and use the incredible leaps in technology coming our way to the advantage of our businesses.
The perfect example of the need to combine the human brain with the computerised brain to ensure a satisfactory outcome is surely the use of GPS systems in cars? Blind adherence to the directions, without any input from the driver, can often lead to a dead end.
So, in the case of robo-advice, the signs all point to the need for businesses to adopt its use, but as part of a wider digital strategy.
As one participant in the Jefferson National study, Kenny Landgraf of Kenjol Capital Management, said: “Robo-advice is one sleeve of that digital transformation. It can complement your practice. But it’s no replacement for holistic financial advice. As clients build more assets, as their situation becomes more complex, they will want to work with an adviser and draw on their wisdom. In the end, people still want to talk to people.”
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