Tech-focused wealth firms win on multiple counts, says Fidelity

Survey of more than 400 advisors reveals impact of technology on client growth, AUM expansion, and service delivery.

A new Fidelity Investments study reveals that wealth management firms with a strong technological orientation see significantly better growth, improved client experiences, and enhanced advisor satisfaction compared to their less digital-focused counterparts.

The findings come from an online survey conducted from November 9 to 24, garnering responses from 426 licensed and credentialed advisors, including some firm leaders and technology decision-makers.

According to the study, technology-forward firms, which apply best practices in strategy, design, and activation of technology, experience faster growth in client numbers (20 percent on average, vs. 8 percent for other firms) and assets under management (22 percent vs. 11 percent). These firms also report greater job satisfaction among advisors, who enjoy higher compensation and an improved ability to serve their clients effectively.

“Our study underscores the impact of technology as a growth driver for wealth management firms that harness its full potential,” Marissa Herr, head of Technology Consulting for Fidelity Institutional, said in a statement.

She emphasized the significant market differentiation that can be achieved by strategically thinking about the platforms, integrations, and tools that best meet the needs of advisors and their clients.

The survey revealed that digitally empowered firms, regardless of size and including various types of broker-dealers and RIAs, are three times more likely to leverage technology to enhance the client experience.

Mirroring the results of a recent report by Cerulli, Fidelity found advisors at tech-empowered wealth firms note increased efficiency across critical functions such as money movement, trading, portfolio rebalancing, account maintenance, customer onboarding, and financial planning.

Furthermore, employees at technology-forward firms often benefit from an enterprise-wide technology strategy and a clear process for evaluating technological solutions. These firms also feature a high integration of valuable day-to-day platforms, contributing to streamlined workflows and better service delivery.

“Firms spend significant time evaluating and introducing new technology, but it’s just one part of the equation,” stressed Jessica Liberi, head of Platform Technology for Fidelity Institutional.

“Activation is equally important. A firm can only reach the full potential of its technology stack if advisors know how to implement the tools strategically selected to support them,” Liberi said.