The asset and wealth management industries are rapidly changing. In fact, industry leaders predict that over the next 10 years, a transformation will occur that is more far reaching than anything experienced before. It’s all about Digitization, driven by a three-way chain reaction between regulation, technology and demographics. That’s the consensus expressed in a global survey of over 450 senior asset and wealth management executives conducted by CREATE-Research for Dassault Systèmes.

In a 32-page report summarizing the survey findings, Professor Armin Rajan explains the market forces driving the move to digitization, and the promises and pitfalls that lie ahead. The numbers and data are compelling and undeniable. But it is the voices of the executives surveyed that illustrate the enormous changes on the horizon, and the critical need for firms to rapidly move from digital complacency to digital competence. Here’s how some of those leaders expressed their view of the near future:

“Digitization is not the first choice or the last choice: it’s the only choice.”

 “The implementation of cognitive computing will be incremental.  But its impact will be monumental.”

“The structural drivers behind Digitization have the momentum of a supertanker.”

“Machines can do things previously unimaginable.”

 “The new human machine interface will create its own version of star culture.”

 “Amazon has proved that there is no limit to product widening and product deepening with technological superiority and strategic alliances.”

 “Artificial intelligence will industrialise the art of alpha generation and benefit those managers who have the necessary technology, scale and reach.”

So, how did the industry get to this precipice of change – and how are individuals and firms preparing for what lies ahead?  According to Professor Rajan’s report on the survey findings:

• Growing cost pressures, the rising importance of fees and charges as differentiators, the rise of low-cost passive funds, the market entry of fintech and internet giants and a new generation of digitally-savvy investors are accelerating digitization.
• Asset and wealth management are set to decouple from a stable past – and re-anchor to a disruptive future. 80 percent of asset managers and 77 percent of wealth managers expect digitization to partially or fully disrupt their industry within ten years.
• Over time, Digitization of the industry will result in higher back office efficiencies and a better value for investors. Firms will see reduced overall profitability, and a de-skilling of the craft of investing.
• Early adopters report reduced operating costs, stronger market position, higher efficiencies, improved regulatory compliance and better client experience.

Where do you stand in readiness for Digitization? Request the full report, “Digitization of Asset and Wealth Management: Promise and Pitfalls”.

Source: CREATE-Research/Dassault Systèmes Survey 2017