If there’s a key word for 2025, it has to be “automation”.
It’s everywhere. Nearly every week, a new tool promises to streamline everything from file notes to SOA templates.
When things are running smoothly, automation can really speed up and tidy our processes. But I can't help wondering: are we automating too much, and are we focusing on the right areas to automate?
I want to be clear that this isn’t a call to abandon tech. Many advisers are successfully using automation to handle tedious administrative work that’s slowed productivity for years, and they’re finally freeing up time for more client-focused activities.
That’s definitely a positive and necessary development. However, the key is ensuring that automation supports, rather than replaces, critical human insight and judgment.
Let's consider the biggest and most obvious issue: privacy. With increased automation comes increased data collection and sharing. While numerous tools offer robust security, building trust requires more than just data encryption; it needs transparency.
It’s very surprising that practices who have had such rigid client privacy rules for years are now casually dropping client fact-finds and file notes into tools like ChatGPT. Clients should know where their information goes, why it's necessary and how it's used.
If the process feels like a mystery, confidence can waver. And if things go wrong – say, a data breach occurs – the implications could be devastating for the adviser and client.
When it comes to providing advice, algorithms might excel at recognizing patterns and suggesting the generic answers, but they often struggle with exceptions. Financial advice is full of these nuances.
For example, a client's situation might meet all the criteria for a particular strategy on paper, but their unique circumstances suggest a different approach. This is something only a human adviser or strategist can discern through conversation and empathy.
Even technology designed to enhance our work, like AI summaries or modelling software, can inadvertently lead to a one-size-fits-all approach if we rely too heavily on them. We need to preserve the individuality of our advice and keep it personalised rather than transactional.
A subtler risk is the erosion of professional judgment. As we lean more on automated tools, there's a temptation to trust them implicitly, even when instincts hint otherwise. It's important to keep challenging and verifying the outputs they provide. Let it be a tool and not a solution we blindly follow.
The goal isn’t to turn away from automation, then, but to incorporate it wisely. Our aim should be to automate repetitive, low-stakes tasks, allowing us to focus on the deeper, more nuanced parts of our work. The best pieces of financial advice often come from real human interactions and insights that technology simply can't replicate.
As an industry, it's vital to determine where automation truly adds value and where it doesn’t. This involves questioning solutions that sideline human input, sharing success stories of human judgment making the difference, and training future professionals to critically engage with technology.
Regulatory bodies also play a crucial role. As automation becomes more entrenched, we need clear guidelines to ensure that innovation doesn’t come at the expense of accountability and that advisers remain actively involved in the process.
Ultimately, our challenge is to integrate automation in a way that enhances the human aspects of financial advice. At its core, advice is about people – and there’s no substitute for a proper conversation.
Advisely Board
