Disruptor or Disrupted – Critical Considerations in Today’s Market

April 2022

Straight To The Point

Wealth and Investment Management is a growth industry, but it remains fragmented, with no clear channel or player who can claim outsized share, leaving participating firms’ operating models susceptible to disruption. The pace of change continues to accelerate, driven by evolving consumer behaviors and generational segment needs coupled with rapid technological advancements. To succeed in this type of environment, firms should invest in creating a well-defined client ecosystem, prioritize resources to support the client journey, and develop an innovative mindset to capture their share of industry growth. Firms should consider whether they want to play the role of disruptor or become a statistic of the disrupted.

Regardless of the current position of the market cycle, wealth is always being created either by business owners/entrepreneurs, participants in equity incentive compensation plans, or savers in retirement plans. Firms should position themselves to be an active participant in the constant flow of funds, the money in motion at the intersections of where life meets money. If wealth is not being created in those intersections, it’s being distributed out of the proceeds of the sales of businesses, rollovers from retirement plans, or generational wealth transfers. Wealth transfers alone are expected to see $70 to $85 trillion move from baby boomers to surviving spouses, next generation family members, or not for profit organizations. These all represent large addressable market opportunities with assets measured in the tens of trillions.

It’s no longer a choice between digital or advisor led service model within the Wealth and Investment ecosystem. Clients across all segments and wealth levels are demanding a first-class digital experience which allows full access and empowerment to self-service coupled with a platform to fully collaborate with Advisors and Specialists around their personal financial needs. A digital first experience will allow clients to stay informed and empowered with all aspects of their wealth, investments, and banking, while creating a platform to collaborate with their team of advisors and specialists. This all translates to change, disruption, and opportunity. Is your firm ready?

Market Drivers

Macro-economic trends, geo-political risks, and the global pandemic have squeezed profit margins, creating industry-wide opportunities for capital efficiency and accelerated innovation.

This constantly evolving market and increasingly competitive landscape allows firms to rethink their overall strategy. Among the most significant market dynamics is an uncertain interest rate environment, fueled by high inflation rates, where impact to economic growth and implications to price levels of risk assets are all factors that place downward pressure on asset books. This is coupled with industry specific issues including competition from new players, a shrinking yet aging advisor ranks, a tendency to delay change response, and a lack of scale or discipline to generate cost efficiencies.

Firms have an opportunity to look closely at their internal operating structures in order to uncover new ways to maximize performance. Increasing efficiencies and leveraging data utilization to improve customer experiences will in turn help generate greater returns on equity and assets.

This evolution should instigate some important business model discussions.

Wealth and Investment Management executives should be asking themselves, will they build, buy, or partner to gain the resources that they need to succeed? How will they create a better digital client experience? And are my data initiatives making a significant impact on the bottom line or preparing our ability to deliver digital advice?

They also need to consider where they are on the continuum of change. While FinTechs, for example, have modernized digital offerings, they sometimes lack the strong distribution models of banks and wire houses. Conversely, banks and wire houses are looking to build out more modern offerings.

In the end, wherever a company stands within the cycle, those firms who implement strategies to transform how they use data  will stand out among competitors. They will not only offer great digital experiences, but they will also create stronger models that enable them to be more in control and empowered to offer better services.

Areas of Consideration

A few key building blocks to consider as companies build a roadmap to success is Human Capital, Digital Adoption and Differentiated Client Experiences.

Considering appetite and capabilities for change within these three areas will not only help manage the change but also to overcome the challenges that accompany it.

Human Capital

Human Capital supports both digital adoption and differentiated client experiences. Transforming an organization requires evaluating whether the current talent is fit for purpose for the direction the company is headed. To best capitalize on the opportunities ahead, companies will need skilled talent that can ramp-up a project quickly and efficiently. Companies should consider whether they will build or buy talent or leverage partnerships to offset this cost.

Digital Adoption 

Unlocking the power of client data to enhance productivity and efficiency is key. A powerful strategy can foster better customer and advisor experiences, more engagement and efficiency, as well as empowerment and collaboration. Firms can immensely improve service through data transformation and analysis, including digital advice models. However, doing so takes strong planning, digital capabilities, technology, data, and distribution strategies.

Differentiated Client Experience 

Tapping into target markets like baby boomers, women, and first-time investors means having a strong omni-channel strategy. This personalized approach must leverage data and integrate banking and investments to provide full balance sheet and cash flow coverage needs and keep clients inside the ecosystem. Omni-channel banking is paramount to truly shift the focus to the customer, enabling banks to provide more customized experiences and deliver services on their own terms.

Moving Ahead

As the market continues to develop, Wealth and Investment Management firms should consider their strategies for facing continued margin pressure. Continuous evaluation of alignment between the strategy and business plan can help ensure that they are aligned with emerging risks. Assessment of change management and application development methodologies as well as application and data architectures will also help gain insights into the next steps of a transformation.

Businesses will also have to consider important levers they’ll pull, such as how they will bypass legacy systems to migrate data. Options like building a data lake or mesh on top of the system can enable target business capabilities while ensuring there is a bidirectional sync between the legacy systems and modernized data lake. Finally, migrating from a data defensive strategy to a data offensive strategy will thrust companies into a new differentiated competitive position. Maintaining the momentum through agile change management will establish the strong governance program to help drive portfolio management processes across end-to-end strategic initiatives.


The future of data is here. Digital disruption can help the Wealth and Investment Management industry advance and provide better products and services. To remain competitive, businesses must adapt, innovate, and streamline processes. The time is now for Wealth and Investment Management firms to decide if and how they will embrace this phenomenon.

Meet our Wealth & Investment Management Experts

Patrick Campion

Patrick is a senior business strategist and wealth management leader with a proven track record of leading large Financial Services organizations to deliver superior performance through profound change. Previous roles include:

  • Wealth Management Americas Region Head at Deutsche Bank
  • CEO - U.S. Private Bank at HSBC Private Bank
  • New York & Connecticut Region Head at The Citigroup Private Bank

John Hogarty

John Hogarty has over 30 years of experience in the Financial Services industry with a reputation as a progressive thinker and advocate for change, possessing strong operating and execution skills. Previous roles include:

  • Managing Director and COO Bank of America/Merrill Lynch, Global Wealth & Investment Management
  • COO of Global Wealth Management, Merrill Lynch
  • Managing Director Strategy and Business Development, Global Wealth Management, Merrill Lynch
  • Director, CFO Business Management/Administration for the Americas Division of Global Wealth Management, Merrill Lynch

Mike McPartland

Mike has 30+ years of experience in financial services with extensive experience leading teams in mergers and transformation initiatives across organizations. Previous roles include:

  • Managing Director at Citigroup
    • Global Head of Residential Real Estate Lending
    • North America Head, PB Lending
    • US PB Fair Lending Officer
  • Managing Director at JPMorgan Chase
    • US Residential Mortgage Product Head, PB and WM

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