4 January 2023

The Board’s eye view

This article was first published by the Wealth Mosaic as a follow up to Swiss WealthTech Live 22.

At our recent Swiss event, Steve Round, Founder at SaaScada, provided the audience with some thoughts regarding the importance of board-level knowledge and experience of technology’s role in driving a company’s success.

From both a non-exec and an exec viewpoint, the board’s role is to provide oversight, challenge, support, and strategic direction. The board must find the balance between risk mitigation and rise to the occasion when it comes to innovation that will lead to business success. Increasingly business success has a strong technology element. But many boards are hamstrung in that they lack the knowledge and experience to know how technology can support the driving of a business forward without taking undue risk.

The challenge is even bigger for wealth managers in a highly regulated environment. Clearly, the wealth management industry needs to manage its risk and reputation, so it is no surprise that the Chief Risk Officer (CRO) has a lot of power and is important in ensuring that risk is managed both internally and from an external perspective. But the board also needs to be looking to move things forward. Technological innovation will underpin future success to keep the client experience relevant, boost quality, retain customers, and attract new ones, all at a lower cost than at present. Can the bank provide a community of interests, new products, and services and stay relevant? And can the banks deliver that in a high touch, digital and hybrid way?

Indeed, the challenge is not just acquiring customers, but retaining them by adding value – to them as customers and to the bank. So how do boards work with the bank’s executive and internal teams to create that sustainable value? In wealth management, we need to find ways to mix technology with human and AI and data so that the client values the bank and its overall offering – as well as the sense of community, as opposed to just valuing the transaction. We need to use this AI and data to provide those value-added services.

The marketing utopia used to be a segment of one. That is now possible, which has changed how banks operate in terms of products and services. The data possibilities are immense! But established banks often do not use that data, whereas FinTech and new entrants collect and use it – accordingly, they can ‘know their customers’ and nurture them much better. That challenges incumbents because they need to keep up with new products and services new entrants offer.

In addition, new entrants have raised customer expectations. No one considers them to be a complete service offering, and that is not their aim. But where they are involved, they excel, creating heightened expectations throughout the market. Incumbents need to keep up or work with FinTechs in extending their proposition.

Technology can support that but is there the internal knowledge and experience to drive innovation forward? In many cases, this means a significant cultural change to accept that knowledge and experience are lacking, together with the new processes that new technology brings in. This then enables an innovative culture of technological change that starts from the top and goes right through the wealth manager.

As vendors, we need to know that the board understands what it is actually doing, why it needs to follow a particular course of action, the long-term implications, the benefits, and the risk.

To this end, the breadth and depth of the non-exec board members will be crucial. We need them to be tech-savvy and understand the supporting role that technology plays. This is as essential as understanding the interplay between humans and technology. Not everything can or should be done with technology, and the personal touch is important.

Any changes in technology should not start with what we do now, but with the customer journey, we want to achieve.

The value will be in the relationship and will go beyond the brand to be in what the relationship delivers far beyond the transactional. This will mean instinctive banking navigating macro trends, sources, or competition like embedded finance, emerging risk, and new economic models. There will be a connected ecosystem, adaptive workforce, and predictive insights, and boards need to understand these elements and deliver the technology to support that for future success.

Technology is here and will be top of mind for a long time. The challenge for us all is making it better for our customers and possible to deliver within the bank.

Jody Roblin

Jody Roblin

Chief Marketing Officer

Jody has over 25 years’ experience in financial services and fintech marketing in Australia and the United Kingdom. Jody has delivered success for both start-ups and scale-ups, with a keen focus on customer outcomes and sustainability.

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