Innovate to Differentiate: How Tech Integration Changes the Game

Wealth management firms build their tech stacks in different ways, but most share the same challenge: activating new tech, loosening legacy’s grip and delivering superior value to advisors and clients — without a blip. Innovations abound — AI chief among them — but effective tech integration comes down to time-tested concepts: data integrity, strategic discipline and organizational collaboration.

We recently spoke with wealth management technology executives about the strategic and tactical advancements that differentiate their businesses given widespread AI adoption and evolving partner relationships. They shared the following five insights for differentiating through tech.

• Prioritize data integrity before AI rapidly scales up inconsistencies: The firms making the most progress with AI are the ones solving data hygiene issues early on. This involves mapping massive amounts of unstructured and inconsistent text labels into a carefully designed, hierarchical classification structure. Normalizing, standardizing and managing the data lifecycle is a painstaking task involving numerous stakeholders, but, it’s absolutely critical, because bad data results in bad AI decisions — at scale.
• Build AI integration and security architecture together: AI governance isn’t optional. Without effective guardrails on identity and access, AI agents have access to far more proprietary data than they should. One example is AI-enabled notetakers, which were quickly adopted because they eliminated the headaches of meeting summarization. Now, these utilities have multiplied and expanded in scope and are involved in customer relationship management, coaching, sentiment analysis, and even advisor development. This proliferation of AI-powered utilities, combined with deeper organizational penetration and data access, underscores the need for thoughtful and strategic integration to prevent chaos.
• Create an integration layer to orchestrate disparate solutions: Over time, firms acquire other firms or merge with or divest them. This is further complicated by the adoption of a wide array of partners and solutions. The result is a highly complex pipework that is old and inefficient, yet difficult to replace or upgrade without major disruptions. One of our clients is addressing this challenge with an orchestration layer that helps them shrink their tech stack by allowing select contracts to expire and replacing inefficient integrations. This central integration layer normalizes data, enables process automation and prevents vendor swaps from disrupting the user and client experience.
• Embrace a field-forward development approach: Many businesses continue to design and develop technology tools in relative isolation, waiting until implementation before involving end-users in the field. This is particularly true when tools aim to solve problems in narrow business silos. Build field feedback into the plan to identify development missteps early; if the solution still fails to deliver value, be ready to halt implementation rather than invest more money in post-release regression testing, sampling and surveys that may prove unproductive and ultimately not help ensure adoption.
• Deploy AI that complements advisors’ expertise: Use AI’s unique strengths to perform tasks that enhance advisor efficiency and productivity. This year, a leading global bank did just this when it released an avatar-based AI agent that speaks with clients in real time about their investment portfolio and related topics. The agent, powered by Google’s AI and cloud capabilities, is available 24/7 and serves as a digital team member that augments client-advisor interactions. This enhances service to meet end investors’ high expectations while ensuring advisors are kept informed and ready to engage.

Conclusion

For many wealth firms, the pathway to achieving an efficient technology stack winds through an obstacle course of legacy systems, inherited provider contracts, and marginal-performance solutions. Innovative firms navigate these realities while harnessing AI’s-potential all while mitigating disruptions to the advisor and client experience. It’s a team effort that must address everything from the smallest piece of data to the largest cross-company integrations that drive future growth and profitability.

Is your firm seeking to differentiate itself by unleashing the full power of its technology? BNY Pershing can help you implement your new strategy successfully.