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Accelerating your digital transformation

Charles Smith
Charles Smith
Global Head of Digital Solutions, Refinitiv

With clients demanding digital excellence, wealth management firms need to urgently accelerate their digital transformation. Based on our experience, we traditionally see firms go down one of two paths towards this goal; they either buy a vended solution or go out on their own and try to build a homegrown solution. However, based on our experience, by adopting a hybrid buy/build blend approach, we believe firms can gain the advantages of both, and accelerate their digital transition.


  1. COVID-19 has accelerated the need for digital capabilities in wealth management. A recent survey found that 76 percent of firms globally reported an increase in clients demanding digital engagement.
  2. A new white paper from Refinitiv explores the binary decision faced by wealth firms on buy vs build, and how to accelerate their digital transformation.
  3. The white paper proposes a new method — Buy/Build Blend. This will help wealth firms lower their total cost of ownership, bring digital strategies to market quickly, and continuously improve the digital client experience.

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In today’s environment, wealth management firms must move swiftly and urgently towards digital transformation.

Every firm we work with here at Refinitiv asks the same question: How are we able to deliver a digital experience that meets clients’ expectations while differentiating us from the competition?

The path to digital transformation

Even before COVID-19 put more pressure on wealth management firms to transition to digital, consumers and advisors desired a host of transformative digital capabilities and functionality. Post-COVID-19, the current data show that consumers and advisors’ expectations will continue to rise, intensifying a digital arms race among financial services firms.

Download our white paper, Putting the hammer down: Accelerate your digital transformation, to explore new strategies helping wealth management firms with their digital transformation

How has monthly business volume changed since the onset of the COVID-19 pandemic year-on-year. Accelerating your digital transformation

A recent survey by the Aite Group found that 76 percent of firms globally reported an increase in clients demanding digital engagement.

Aite Group said: “It is likely that this crisis will cause substantial stress for investors, and cause some to switch providers due to shortcomings displayed by wealth management firms and financial advisors.

“Firms that come into this crisis with a weak balance sheet or that have missed the opportunity to embrace the latest technology will risk losing clients and possibly go out of business.”1

On a positive note, the survey also found that more than 90 percent of firms exhibited some degree of satisfaction with client receptivity to digital engagement, and no firms were not at all satisfied. This indicates that firms are finally seeing a positive return on investment for their digital adoption.Rate your level of satisfaction with client receptivity to digital engagement since the onset of the COVID-19 pandemic. Accelerating your digital transformation

In this new environment, wealth management firms risk being left behind if they don’t make the proper investments in their digital strategy.

Successful firms will leverage existing digital infrastructure in new ways, primarily by leveraging buy/build hybrid strategies to accelerate their transition to digital and enhance their ability to continuously improve while reducing costs.

To buy or build?

Historically, wealth management firms faced a binary decision for their digital transformation: Buy a solution from a vendor and integrate it, or build a bespoke one with their own resources.

When they go down the route of the latter path, firms tend to underestimate the time and resources needed to develop a custom platform in-house.

Beyond the initial design, development, testing, and implementation costs, firms need to consider the cost for ongoing maintenance and support, as well as most importantly to include the cost of continued enhancements to maintain the competitiveness of their platform.

The iceberg diagram below illustrates what I am talking about: Some costs are visible and known upfront, but a whole host of hidden costs aren’t seen or felt until too late.

The total cost iceberg

Total cost iceberg
Source: Refinitiv

In the build scenario, firms need to hire and maintain employees with a digital skill set (design, user experience, concept testing, integration) that may not have a ‘home’ in a traditional wealth firm.

This takes away resources and focus that could be better spent on core business capabilities and differentiation.

Conversely, firms that have relied solely on a vendor experience platform have seen some success in getting to market. However, they must tackle issues from data integration to internal systems and high ongoing fees from the vendor to maintain the platform.

We have also seen these firms lose some control over the design and ongoing delivery, and become dependent on a vendor’s ability to update its platform and push a release to the client that must then be tested and installed.

Hybrid approach to digital transformation

Today’s modern digital infrastructure offers wealth management firms an option that blends the control of an in-house build with the lower cost, flexibility and support of the buy approach. We call this a ‘buy/build blend’ model.

The buy/build blend model uses a digital and data technology infrastructure ‘Building Blocks’ approach to accelerate firms’ transformations, leveraging pre-built components that can be configured to a client’s look, feel and capability needs.

The model also enables a simple process for implementation and maintenance which allows firms to focus resources on points of differentiation.

And it maintains a robust digital infrastructure that enables firms to continuously innovate to provide leading capabilities at minimal expense of resources and cost.

Charles Smith quote

Buy/build blend allows firms to focus internal resources on areas that align their digital offerings with their unique service model and business strategy, creating a competitive edge and helping to move the firm towards digital excellence.

The time to digitize is now

We at Refinitiv believe that leveraging technological capabilities and following a hybrid approach to digital transformation allows firms to lower their total cost of ownership, bring digital strategies to market quickly, and continuously improve the digital client experience.

With clients being open to digital engagement and even expecting it in today’s world, we are seeing a sprint by many wealth management firms to not only meet the minimum client requirements but to also delight clients with an outstanding digital experience. This will quickly turn into a marathon as firms will need to continually update their experience and upgrade their platform’s capabilities.

The best way to win the race will be to blend together the best of both worlds; building a modular digital experience that utilizes building blocks that can be enhanced or upgraded gradually over time to keep pace with change.

Download our white paper to learn more about the Buy/Build Blend method and how you can accelerate your digital transformation

1. COVID-19: A Global Perspective on the Impact on Wealth Management, Aite Group, July 2020


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