Digitalisation of the Value Fund Chain?
Did I ever mention I love mechanical wristwatches and classic cars? I covet their old world engineering despite the presence of more efficient, effective and modern substitutes. The advent of the Apple Watch is a good example, in all unemotional ways it is superior to my ageing Swiss autos, yet I choose to don the inferior choice: is that vanity, prestige, stubbornness, nostalgia or fear? However as I watch the latest Apple event I sense that change 'cometh the hour. Tick tock.
Putting Apple and Google aside for now, 'Digitalisation' I.e. the rise in financial technology ('fintech'), Robo-advice and its impact on the value chain is unavoidable. We have entered the age of BIG DATA and one thing big data does is it collates and removes traditional information advantages and creates new data advantages. Today's investment industry is being challenged to update into the digital world. Digital does not respect geographic borders, a Californian based digital provider can access clients in Asia and visa versa. Ask, what part of the value chain cannot now be digitalised? What changed was the technological revolution and the dawn of 24/7 Media. Now investors had access to the information and they started making decisions on their own. The growth over 50 years of the lucrative ‘retail’ market was about to have some unexpected side-effects. Digital and fintechs are changing the world, robots changed blue collar jobs 20 years ago, and now so will fintechs for white collar jobs in asset management.
JB Beckett will be speaking in panel discussions on 'The Digital Future Of Fund Selection' and 'The Digital Prerogative For Distribution' at FundForum Asia, 18 - 21 April 2016, Hong Kong.