Why Robo Advisors Won’t Be Coming for Your Job Anytime Soon

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Written by John Pierce

John Pierce of Stifel

When it comes to wealth management, a personal touch still goes a long way.

Automated investment services — perhaps better known as ‘robo advisers’ or ‘fintech’ — are getting their fair share of lip service across the financial services industry. As concerns that technology will irreversibly disrupt the status quo grow louder, many financial advisers are feeling anxious about their job security.

It’s true that technological advances have led to the rise of impressive, multifunctional fintech products. But will algorithm-driven investment platforms really put living, breathing advisers out of work?

Although their role will vary depending on each client’s needs, robo advisers will play a part in the future of financial services. But their rigid capabilities, impersonal advice and — to be blunt — lack of humanity won’t likely replace human advisers anytime soon.

People Matter More

Interpersonal relationships have always been the lifeblood of the financial services industry. Stifel has maintained its strength during turbulent times by adhering to the firm’s core “client-first” philosophy, which centers on customized advice and personal service. Robo advisers and fintech solutions, on the other hand, are often limited by a pre-programmed script designed to interpret marketplace analytics — not an individual client’s needs.

We at Stifel see the unique, irreplaceable value in an adviser’s ability to build personal, lasting relationships with their clients. Market fluctuations are inevitable in this business, and in times of financial uncertainty, investors need a human touch — an experienced and calming voice that can reassure them that everything is going to be okay. An algorithm can’t do that. Nor can it challenge itself to think outside the box or investigate new strategies that could benefit the client. At Stifel, we encourage our advisers to do just that.

Striking the Perfect Balance

While financial services will always be an adviser-led industry, firms of all sizes should make the most of today’s technologies. After all, fintech can play a role in helping advisors boost productivity and deliver advice more efficiently. It also can help your advisors attract millennials, who favor the ease and simplicity of robo advisers. Any firm that fails to recognize this fact risks losing out on the business of this key demographic.

But robo platforms, while valuable in terms of the insights they provide, will never replace the comfort and rapport established between a client and their adviser over time. At Stifel, we offer the very latest in investment-related technologies and services. However, we use those resources to enhance our advisors’ capabilities — not to replace our advisers altogether.

John Pierce is head of recruiting for Stifel.


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