Adapting to technological change to streamline administration

Speaking on a recent ifa podcast, Denis Orrock, chief strategy officer of wealth management platform Praemium, said the main role of platforms is making life easier for advisers.

“One of the primary functions from platforms is to facilitate the reporting and administration of investments and advice and make the advice process simpler and the administration process around that more efficient,” Mr Orrock said.

“Providing comprehensive transparent data is critical. And obviously, the reports that support the advice that’s been provided by the adviser. So, when we look at that, collating and presenting client information in a relevant format, being able to disseminate the investment strategies and how advice may have changed over time in that investor’s life cycle, that helps the adviser demonstrate the appropriateness and the value of the advice they’ve given.”

He added that platforms need to adapt to a changing technological environment in the wake of the sudden AI wave.

“How do we leverage things like artificial intelligence, machine learning? We’re in the whole ChatGPT hype at the moment,” Mr Orrock said.

“If you wind your mind back maybe six years, seven years ago, blockchain was going to change the world and solve all our problems as well. Technology’s just a tool.

“I think sometimes a new technology will come on the scene and it becomes a solution looking for a problem, not so much identifying the problem for the solution.

“We have an AI insights capability, and that’s all about identifying investor behaviour through learning from their engagement and their investments and then identifying what additional advice or support the adviser might need to provide that investor. So, that’s where we are using those technologies.”

While AI has all the buzz, Mr Orrock said integrating data with other platforms could provide huge benefits for advice practices.

“The bigger impact for platforms, particularly moving forward, is how the data that sits in our platforms integrates and interfaces to the overall ecosystem that’s in the marketplace,” he said.

“We need to identify that [investors] may want our information to intersect with other platforms’ information, for example. I think that’s where the industry, working out how this data and the integration points come together, can really generate some significant efficiencies for businesses as well.”

Mr Orrock added these points of focus are in line with the government’s response to the Quality of Advice Review, particularly in making statements of advice less onerous.

“If you look at the Quality Advice Review, one of the key priorities there was how do we bring quality advice to more people? And obviously, in the current environment, if we have 16,000 advisers, we’re not going to have 32,000 in the next 12 months,” he said.

“So, how do we actually generate more advisers being able to handle more customers and do so in a quality, meaningful manner? The advice process needs to be more efficient. Platforms have … gone a long way in terms of automation of workflows, client onboarding, etc. But continual investment and continual improvement needs to take place in that space.”

To hear more from Denis Orrock, tune in here.