Customer Centric Wealth Management Competency

This week I caught up with some old friends for lunch and we had some interesting discussions.

One of them mentioned that he has been approached by financial service providers offering wealth management products and services. After having gone through their proposals, he remained yet to be convinced of the value proposition of these service providers i.e. financial planners and or private bankers.

His view was that he could obtain a risk-free return of say 3-4%per annum in a fixed-income product, and the best these service providers could do is to offer a return of non-guaranteed return of 8% per annum. He felt that the services offered were of limited value, and this essentially would be in the form of providing a listing of funds with details on their respective performances. He felt that he would be better off constructing his own portfolio.

Without dwelling into the details, here are my observations.

First, we have a valuable insight from a prospective consumer and he felt that the choices available were not up to his expectations. Second, the service providers appear unable to articulate and communicate their execution capabilities to convince my friend of the whys and hows of wealth management. Obviously, wealth management is an art as well as science, and for the uninitiated, the literature can be and is overwhelming. However, one should not underestimate the intelligence and instinct of the consumers.

The present state of offering these services certainly can be improved through education and or competency-based learning.

Competing on the same paradigm, and with supply outstripping demand, growth for the wealth management industry is likely to be curbed unless service providers can provide value innovation in their services. The underlying discomfort is about fees levied by the service providers for services that are perceived to be of limited value.

The challenge is for the wealth management industry to come up with a set of competency -based learning program that is customer-centric in orientation. The likely winning proposition could be one where the service providers and or the industry can offer tools that empower the individuals to measure and manage their wealth. It is hope that uncontested space can be created and rendering the competition irrelevant. After all we are talking about world class talent and the world is our stage. So would be our competition.

Well the opportunities are.......mavens ( typically consumers ) , training providers, value based management, human resource , learning development consultants as well as service proivders can come together to draw up a strategy roadmap to make Singapore the wealth management mecca.