Alex Jagmetti of Falcon Private Bank explains the components of an effective client experience and what institutions and the industry should do to get this right.
Date: Jun 2011
The individual who is interacting with the client, and can then direct the client appropriately, is the key, he explained – which relates to a relationship manager’s (RM’s) ability to listen, understand and then source properly.
Yet this is more difficult to achieve in practice than people think, said Jagmetti. The larger banks spend millions of dollars a year trying to get the message across, with other institutions focusing very hard on this also.
But ultimately, people like to talk more than listen, which is the essence of the problem, he said, combined with the fact that many RMs are monetarily driven, meaning advice can be based on “what’s in it for me” as much as what is in the best interests of the client.
Rather than taking this type of short term approach, which is detrimental to individuals and the industry as a whole, Jagmetti said that putting the client at the centre will mean the client doesn’t feel like the recipient of a factory-style product shelf.
Role of technology and product
According to Jagmetti, it isn’t necessary to have the largest product shelf or the best online offering in private banking.
Ultimately, a bank needs to create understandable statements and letters of advice.
Clients mainly want to see the details of their portfolio and transaction information, and have those explained to them clearly.
Adapting techniques from Europe
The European approach to wealth management is more holistic compared with the sales-driven approach in Asia, explained Jagmetti.
This is inevitable, given that wealth tends to be first or second generation in Asia, compared with 3rd, 5th or longer in Europe, which has helped the financial planning concept become accepted over time.
The industry in Asia has, however, been working on trying to get advisers to fully understand clients’ needs and see how they can service these needs.
Jagmetti said the current shortcomings in terms of the client experience in Asia are due to Asian wealth management being a relatively new industry with a thin talent pool, and one that lacks the generation of private bankers which has perfected techniques over time.
Talent is available, and appropriate individuals are being fast-tracked, he explained as well as money being spent on talent development. Plus, banks who are keen to hire can either do so laterally or by looking to upgrade priority bankers to private banking. But this will take time – perhaps another 10 years or so – to get people up to the right level in terms of product knowledge and holistic wealth planning, said Jagmetti.
Rarely will an individual be competent across asset classes and have the maturity, patience and competence to bring this across to clients, and in a way which is on an advisory rather than a sales basis, added Jagmetti.