How advisers can survive disruptive technology

TD Ameritrade's Vijay Sankaran said advisers must be adaptable to avoid going the way of Blockbuster Video

Jan 31, 2018 @ 1:19 pm

By Ryan W. Neal

Change or die.

That's the new mantra adopted by Vijay Sankaran, TD Ameritrade's chief information officer, to sum up his approach to new technology. Kicking off TD's 2018 National LINC conference in Orlando, Fla., Wednesday morning, Mr. Sankaran said it's something advisers need to be thinking about as well.

"You may be the strongest adviser, or you may be the smartest adviser, but the ones that are willing to change and adapt ... are the ones who are going to survive," Mr. Sankaran said, paraphrasing a quote from Charles Darwin.

He said companies go the way of the dinosaur — or Blockbuster Video — when they get too attached to existing business structures and traditional views on how to segment clients, or worry too much about business cannibalization, leaving them open to disruption.

"We have to continue to innovate to provide our clients with better services," he said.

(More: This is the No. 1 cybersecurity threat to financial advisers, experts say)

When it comes to the independent registered investment advisers who custody with TD Institutional, Mr. Sankaran said they need to embrace data and how it can be used to drive business results and support clients. They also need to be thinking about replacing manual interactions with automation wherever possible to improve efficiency.

He added that the advisers who take advantage of new interfaces, like the Amazon Echo or chat bots, for client communication and use artificial intelligence as a personal assistant will be the ones who successfully navigate the coming wave of disruption.

Mr. Sankaran said TD will work with advisers on these fronts, supporting new communication technology and improving Veo One, TD Institutional's technology platform for advisers, to allow for more client self-service and mobile-first capabilities. The company is looking to strengthen its analytics and build AI that can better answer questions for both advisers and clients.

(More: 9 new tools even low-tech advisers should know about)

Automation is a "strategic goal that is imperative for our firm," he said, adding that TD is "digitizing everything to be hyperefficient."

Mr. Sankaran's presentation was light on specific examples of how TD is working toward the goals. The key takeaways for RIAs, he said, are to think about new technology paradigms in the context of their practice, make sure other partners are tech-savvy and take cybersecurity seriously.

"We live on a cusp of disruption right now that none of us have seen before," he said. "It's time for us to spend a lot of energy thinking about these things and how we adapt our businesses moving forward."

(More: What's the next emerging technology for advisers?)

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