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cognizant reports | April 2014
cognizant reports
2
Executive Summary
Asia offers signifcant growth potential for wealth
management frms. Private wealth is growing at a
healthy rate, driven by high GDP growth, a strong
savings rate and an expanding base of wealthy
individuals. Investor needs and preferences in the
region are diverse, and existing and potential cli-
ents are primarily young and technology-savvy.
This generation of wealthy individuals is driving
mobility adoption, as they rely on their devices to
track their fnancial information and investment
options. Following the global fnancial crisis, many
of these investors began to focus on risk reduc-
tion, preferring to diversify their investments
across a variety of wealth management frms.
Despite growing opportunities, wealth manage-
ment frms are struggling to capture the poten-
tial of the mobile market. Skewed client-advisor
ratios and the preference among clients to be
actively involved in investment decisions make
it diffcult for advisors to improve wallet share.
High cost-to-income ratios, resulting from rising
operational costs and low advisor productivity,
are also increasing margin pressure on wealth
management frms.
Adding to these multi-layered challenges is a
severe industry talent crunch and soaring costs
of hiring wealth managers. The regulatory envi-
ronment remains focused on client information
protection, transparency, tax compliance and
disclosure, market stability and prevention of
fnancial crime. Further, the entry of a new breed
of low-cost, technology-savvy competitors is
raising the expectations of young high net worth
individuals (HNWI) on how technology can be
effectively leveraged to service them, intensifying
Private Financial Wealth: Asia in the Lead
Figure 1
Source: Boston Consulting Group
28.0
43.3
38.1
17.2
4.8
3.9
48.1 48.0
44.6
18.2
6.5 5.9
0
10
20
30
40
50
60
Asia-Pacific
(except Japan)
North America Europe Japan Middle East
and Africa
Latin America
T
r
i
l
l
i
o
n
s
(
U
S
D
)
2012 2017 (estimated)
the challenge for traditional frms to offer similar
services quickly.
In our analysis, three-quarters of the top wealth
management frms in Asia have yet to adopt
mobility for their client services. Key impedi-
ments to mobility adoption include:
GPS capability: Allows location-based, contextual services, such as offers, alerts and concierge
services.
HD resolution screens: Uses graphical and charting capabilities, as well as interactive fnancial
planning apps, to drill down and understand portfolios.
Touchscreens with gesture control: Provides control and navigation features in which every pixel is
active.
Security: The use of biometric electronic signatures ensures communication between advisors and
clients remains secure.
Tools Begin to Matter
Figure 5
Source: CEB Wealth Management Advisor Benchmark, 2012
Advisors find mobile tools boost their effectiveness and efficiency.
*Respondents could choose more than one response.
Respondent base: 1,422
Ineffective Effective
(
P
e
r
c
e
n
t
o
f
r
e
s
p
o
n
d
e
n
t
s
)
19
25
29 29
39
70
66
59
56
27
0
20
40
60
80
Improves my
advice quality
Improves my
service quality
Improves my
sales process
Saves me time None of the above
cognizant reports
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enable clients and advisors to spend less time on
documentation and other tasks that can be pro-
vided through self-service apps.
Mobile applications can scan documents in
high-resolution, share client information with
back-end systems, manage documents and
assist clients with fnancial planning. Advisors
can free their time to focus on building and
enhancing client relationships, thereby adding
to the bottom line (see Figure 5, previous page).
Wealth management frms seeking growth and
an increased share of the lucrative market need
to invest in experienced advisors and technology-
based systems to improve the productivity levels
of advisors.
Lowering Costs through Self-service
In the coming years, wealth management frms
can expect to increase effciency by delivering
more services to wealthy individuals over tablets
and mobiles. Key app features will include interac-
tive charts, fund-rating capabilities, social media
tools, meeting facilitation and tools that enable
instant interactions.
The Path to Mobility
A Holistic Mobility Strategy
We recommend that wealth management frms
develop a well-thought-out strategy that links
mobility offerings to clearly defned KPIs. They
can start by:
Six Implication Areas in Digital Strategy Asian Wealth Managers Should Bear in Mind, Asian
Banking & Finance, July 2013.
http://asianbankingandfnance.net/investment-banking/commentary/6-implication-areas-in-digital-
strategy-asian-wealth-managers-should-b.
Evolving Wealth Management in a Digital Age, Wall Street Technology Association, 2013.
http://www.wsta.org/publications/ticker-magazine/publications/2013-issue-3/evolving-wealth-
management-digital-age/.
Aala Santhosh Reddy, Rajeshwer Chigullapalli, Jeffrey Wallace and Harold Albo, Jr., Mobilizing the
Enterprise, Cognizant, February 2012.
http://www.cognizant.com/InsightsWhitepapers/Mobilizing-the-Enterprise.pdf.
Client Onboarding: Move to Channel of Choice and Reap Rewards, Aite Group and Kofax Inc.
http://www.kofax.com/downloads/white-papers/wp-aite-client-onboarding-move-to-channel-of-
choice-and-reap-rewards.pdf.
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Credits
Author and Analyst
Aala Santhosh Reddy, Cognizant Research Center
Subject Matter Experts
Aamod Gokhale, Director, Consulting, Cognizant Banking & Financial Services
Amar Devasthali, Manager, Consulting, Cognizant Banking & Financial Services
Design
Harleen Bhatia, Design Team Lead
Suresh Kumar Chedarada, Designer