WM Market Reports

Driving Efficiency Through Wealth Management Platforms - Celent Study

Stephen Little Reporter 17 July 2013


There has been an evolution in how the wealth management platform is defined, with a growing appetite for an enterprise-wide single infrastructure solution that combines technology and services, according to a new report by Celent.

the past year there has been an evolution in how the wealth management
platform is defined, with an increasing appetite for an enterprise-wide
single infrastructure solution that combines technology and services
into a completely integrated front-to-back service offering, according
to a new report by Celent, the financial research and consultancy firm.

The report, Driving Efficiency Through Wealth Management Platforms,
said that firms are looking to gain efficiency by reducing the number
of vendor relationships and combining technology and services into a
unified offering with a few key strategic partners. The findings echo those stemming from an industry survey by PricewaterhouseCoopers, which found that wealth managers in the Americas are more tech-savvy and
target a far leaner business model than is the case for their global peers.

In its study, Celent identified a number themes it says are driving increased interest and
investment in outsourcing services and wealth management technology

"As a result of stringent regulations, increased client demands, an
increasing number of channels, greater transparency requirements, and an
increased focus on risk, wealth managers have focused on lowering costs
and reducing turnaround times, while improving efficiency and creating a
holistic view of clients. A pillar of this strategy is integration of
data, channels, people, and processes," the firm said.

The report said that wealth management firms that lead the pack will
succeed through more intelligently deploying capital and realigning
resources so they can have a single focus on growing and scaling their
business across segments. 

"Wealth managers have entered a new stage in their relationships with
vendors, one in which they are looking to outsource as much as
possible while simultaneously controlling the number of vendor
relationships," Celent said.

According to the report, clients are increasingly looking for vendors that will support
several components of the advisory process while also providing the
infrastructure to integrate to other systems when necessary.

Celent said it expects to see a number of additional trends in the
platform provider market, including an expansion of strategic
partnerships and an increase in focus on commercial planning activities.
The firm also said it believes there will be increased interest in
turning to service providers for model portfolio advisory, and that the
integration of data and channels will remain a top priority.

"Industry trends demand a new business model where wealth managers
focus their efforts on a few differentiators and offload services and
technology to a provider that has the scale to support a firm's
infrastructure. Increasingly, wealth managers will require a fully
integrated, end-to-end solution that can manage evolving client needs,
operate seamlessly in global markets, and drive efficiency throughout an
organization's wealth management business," Celent said.

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