Insight Automation & Next-Best Actions for Advisor Relevancy

Today’s fast evolving advisor technology has been focused on issues like heightening advisor capacity and effectiveness, enhancing client engagement, and capturing a deeper level of customer information. These efforts, in part, have been driven by the undeniable realization that communication between advisors and clients in all its forms and delivery methods are critical for success in retaining assets, building trust, and developing growth from referrals. A YCharts communication study of 650 advisor clients reported that not only did they want more communication from their advisors but 75% stated that they wanted highly personalized and proactive outreach that anticipates their questions by contacting them in advance.  But being truly client-centric in a fast paced and rapidly changing world is more formidable than ever. Technologists are being challenged to address the advisor’s critical question of: How can I have more meaningful and relevant conversations with my clients and prospects?

In response, some FinTech companies are increasingly developing the ability for precision in personalization efforts and the potential for deep, encompassing client connection by marrying their “improving advisor productivity” and “enhancing the customer experience” development tracks. This effort has been integrating the best elements of behavioral finance, machine learning, digital social tools, and bigdata management that on an AI-powered platform can independently learn and determine insights from user activity and feedback and suggest a timely course of action – a next-best action.

To better understand where we are on the art and science of this new level of client engagement, we reached out to a leader in these efforts, Institute member Nathan Stevenson, CEO of ForwardLane - an AI-powered insight automation platform that dramatically accelerates the productivity and meaningful engagement between financial advisors and their clients. Their FinTech engagement platform helps advisors efficiently target client segments, know who to talk to, what to say, and why. We wanted to explore what this means for advisors and how this also addresses what clients really want.

Hortz: What was the motivation for starting ForwardLane? What advisor challenges did you see that most needed to be addressed?

Stevenson: During the last financial crisis, millions of investors lost 30-40% of their investments, because they did not get access to the right information in time. As a hedge fund quant, we could see this coming in advance, and had time to respond because we had access to the best insights. Cut to New York City, and a global private bank, where we discovered that even though there was great research available, it was difficult for advisors to get this information to clients in time. We discovered a big problem, that advisors had many systems with disparate data, which requires substantial time to process. 

It was at that point that we set about to solve this vast challenge. Can we use advanced technology to automate 80-90% of data analysis for advisors and make sure that clients receive on-demand, seamless, personalized insights, as well as proposed next best actions so that they can make better decisions with their wealth?

Hortz: What research and experiences provided guidance in developing your insight automation platform?

Stevenson: We take a design-thinking, user-centric approach to developing the platform. When we first built the platform, we ran design-thinking workshops with stakeholders at Barclays Wealth Management. We have done “day in the life of” studies with financial advisors to understand the daily workflow, the data that is reviewed, and the tasks undertaken. Prior to the launch of P3 - our cloud-based offering for RIAs - we conducted extensive market research with over 100 financial advisors that work at RIAs. In addition to in-depth interviews, we also ran surveys and gathered their direct input to the Advisor Experience that we offer and asked how they would improve upon it. All of this went into the product development and tailored the offering for advisors. 

We have been focused on personalization since inception because this is central to our mission of delivering powerful relevant insights to make better decisions. This is becoming more prevalent as larger firms place personalization at the center of their offerings. 

Hortz: How exactly does your platform determine client insights, send “signals”, and suggest “next-best actions”? 

Stevenson: We enable superior personalization by processing both structured and unstructured data to gather insights by linking together CRM data with custodial and market data. A signal is a business rule or piece of analysis which triggers when an event or pattern is detected. This can be a simple task like identifying cash flows and outflows, notifying when clients have birthdays, or more sophisticated insights such as detecting negative sentiment in CRM notes and monitoring major portfolio moves.

“Next best actions” (NBAs) are an evolution of signals and provides guidance as to how to use that data - it provides the “story” around the data. We also provide full transparency into where the data came from and how a signal is arrived at. Finally Type 2 NBAs can be full automations or flows. This is an exciting new workflow automation capability we are introducing… further easing the workload for advisor.

By automating and scoring analysis that one might perform when preparing for meetings, prospecting, or managing your practice, advisors can be more effective in working with their clients, more responsive, and more specific and relevant in their engagement. With our patented platform, we are able to surface the best insights for every advisor client, every day.

Hortz: What are the key benefits that advisors can expect in using the AI-optimized workflow built into your system?

Stevenson: Advisors report substantially reduced meeting preparation time, improved client retention rates, increased wallet share, and deepened relationships leading to more referrals. These are clear benefits coming from automation of client data analysis and delivery of summarized client insights for all clients into your workflow on a daily basis.

Most important, improving communication quality and frequency with personalized insights, targeted signals and specific NBAs maximizes and reinforces advisor relevance. This enables advisors to 1. Improve the client experience, 2. recommend new business opportunities, 3. target new client segments more effectively, and 4. upscale advisor productivity.

Hortz: Can you share a brief example of how some advisory firms are working with your AI insight platform? 

Stevenson: An advisory firm with a thousand mass-affluent clients, in addition to high-net-worth clients, were looking for a digital solution to help prioritize their clients. Our Client Prioritization system enabled then to combine CRM, custodial, cash flow and market data, and provided them with the capability to configure the relative importance of different signals about their clients’ goals, investments, and transactions and see a list of clients based on their unique needs which is customized for them by our Auto-Tuner algorithm. As a result, advisors in the firm know exactly which client needs to be contacted first when they come to work every morning.

Hortz: Does your platform also generate original data insights on successful behaviors of financial advisors and how can that benefit larger RIA advisory firms and broker/dealer enterprise relationships?

Stevenson: Our automated insight platform generates aggregated analytics around which signals are being used, how they are scored, how they are used, and for which clients. This can be useful for larger RIAs, Broker dealers and managing partners to see trends across advisors and discern which types of signals and engagement works best for some advisors vs. others.

The same analytics can be applied to client segments to see how different types of clients prefer to engage. This kind of analytical data that provides insights across a firm and across data silos can be very useful for managing and monitoring resourcing decisions, enabling marketing, and providing analytical feedback on engaging new client segments.

Hortz: Any other thoughts or recommendations from your experience that you would like to share?   

Stevenson: Our insight automation platform helps advisors and wealth management firms prioritize, prepare, and personalize communications at scale, across all your clients, every day. We invite you to learn more by visiting us on our  website to learn more about how to use 1:1 content recommendations, next best actions, and personalized insights, for each and every client, that will create deeper and more relevant engagement.

Related: A Modernized Approach to Tactical Investing and Portfolio Design