Solution Framework

Generic services offering model is going to play a big role in case of wealth management services. A HNWI client expects exclusiveness in services in a normal manner. In highly competitive market, key to success for a firm lies in offering exclusiveness in services delivery (high quality services on most personalized basis), going beyond the client expectations.

A solution framework with considered inclusion of following key elements would help firms in meeting and exceeding client needs towards sustainable business growth.

Quality of Service Level

Quality of service level provided by the service provider firm would the key determinant of growth and success in client acquisition, client satisfaction and client retention aspects.

In a sense, service offering could be developed in the form of partnership with the client based on trust and integrity, where the relationship manager remains highly responsive to client sensitivities and expectations.

Without over-emphasizing, a satisfied client would provide multitude of opportunities of growth of business – through deepening the relationship, direct / indirect referencing as well as cross selling of products. In the other situation of deficiency in service level, he would not hesitate to move the business to another firm.

This keeps strong emphasis on continued engagement with the client on the aspects of client expectation and servicing, rather than showing extra attention only during the period of client acquisition. Focused around client needs, a broad framework of service offering during whole lifecycle of client investment management would be revolving around: Anticipate, Analyze, Advice, Act and Monitor cycle.

Universal Service Offering

To meet the client needs in holistic manner, product and service offering range of the firm should be wide enough to cover the investment spectrum across its lifecycle.

In an ideal situation, a client would expect to deal with a single firm to get complete range of investment management services. However, for various business considerations of the service provider firm, in many situations it may not be a viable proposition to offer those services.

While universal service offering with assortment of services under single umbrella is not attainable in house, it could be achieved through active partnership and affiliation. But, due consideration is required that quality of service level provided by partners/affiliates does not get compromised in any manner. Any shortcoming in service quality, even if caused by partner/affiliate’s services, would be ultimately impairing

client satisfaction towards the firm.

Investment in People Processes

As relationship manager remains the face of the firm to a client, success of the firm would be greatly dependent on the skills, drive and enthusiasm of relationship managers (to take an extra mile), while bonding and dealing with any of client issues.

This aspect is more challenging than as it appears. This necessitates transformation of organizational philosophy towards its people and people processes contributing to business success. Firms would be required to invest heavily in human processes to attract, groom and retain a motivated team of relationship managers, who will make the real difference between winning and losing the game.

Price not a True Differentiator

Pricing as a key differentiator to distinct the service offering from one firm to other may not be highly relevant in case of wealth management services. Focused on performance and quality of service, pricing in isolation will not make much meaning to service seeking clients. Client would always value the pricing from the quality of services received. He will certainly not mind paying extra, if he finds services offered

to him meeting and exceeding his expectations.

Unconventional Delivery Channel and Communication

Delivery channel for service content and mode of communication has to be greatly customized – aligned with the client-desired vehicles. This would require a process of continuous re-inventing and re-defining the grid of delivery and communication channels to meet client expectations. Impact of technological advancements and its interplay on service delivery and communication method would certainly be an equally challenging aspect to be factored in, while designing such strategies.

Flexibility of Technical Architecture

While business potential appears to be quite high, existing business architecture still does not provide any sound basis to formulate technical roadmap. Added to that, dynamic characteristics of client profile bring an increased challenge in drawing a firm implementation blueprint.

In the given situation, any big-bang commitment towards technical implementation plan would not be a wise idea. A prudent approach would be to get started on modular basis with progressive integration of functional components in order of its functional significance. Gaining insight and confidence around the business processes, this could be gradually scaled over the period of time.

To meet the information technology requirements, a firm has several alternatives (or combination of alternatives) to consider:

Ö Integrated solution approach: Developing in-house applications to meet end-to-end new business requirements. These applications are based on existing technology architecture of the firm and are closely integrated with the existing service models. It would be a least preferred choice in the current situation, on count of cost, time, lack of clarity and complexity of solution.

Ö Service Bureau /ASP Model: A recent trend has been witnessed in the solution provider’s landscape. Many of information technology service providers have come out with novel solution for investment management / investment processing platform in the form of service bureau / ASP. This platform provides integrated end-to-end processing infrastructure and services including core of business processes of wealth management.

On the part of a wealth management firm, paying agreed charges to service bureau provider, option of service bureau completely eliminates the requirement of ongoing resource commitment and cost of maintaining information technology infrastructure.

While total cost of owning may be the key motivating point for a wealth management firm to adopt service bureau model, the key consideration of providing high quality of service level with enhanced responsiveness may not be adequately answered. The question remains to be answered is – what would be the key differentiator in service offering of two wealth management firms operating from the same service bureau?

Ö Stand-alone commercial software product/solutions: Pre-packaged solutions that can be focused to specific part of services or provide comprehensive end-to-end processing. These can be deployed independently or could be integrated with existing systems. Cost, customization and integration difficulties would be the challenging points.

A loosely oriented technical architecture with optionality and mix of Build – Buy – Integrate components would be considered as a good beginning point. To provide enough resilience and high business relevance, any of the considered option and associated structure should keep due provisions for the following key elements:

Ø Considering the complexity of business processes and involved business rules, rule based processing would be the core of processing.

Ø Client profile acquires many new dimensions with plethora of attributes. Client data is required to be appropriately managed (aggregate / segregate) to build a profile driven solution offering.

Ø Decision support and client oriented analytics acquire more importance.

Ø Applications should provide adequate flexibility to incorporate manual processing interfaces