In March 2016 PwC released a survey that addressed fintech and its impact on the financial services industry. The report, Blurred Lines: How FinTech is shaping Financial Services, surveyed 544 top-level executives in the market to get a better understanding of how they felt the tech revolution was changing their world. While the biggest area of disruption due to fintech is banking and payment services, the management that participated in the survey said that asset and wealth management is the next category ready for disruption.

As technology takes over our daily lives and the use of mobile platforms increases, clients expect the ease of use technology brings them to be available to them when investing, too. Another driver for the technological change is the upcoming shift of Baby Boomers dominating the market ceding market share to a younger, extremely tech-savvy generation. This younger group wants an increased focus on customer experience, convenience and speed of service.

According to the report, management expects 22% of its business to be at risk by 2020. Yet only 45% of asset and wealth management companies have put fintech at the heart of their business strategy. So how will financial services providers navigate the changes in the industry so that they can thrive? First they need to understand the fundamental change in how business will work. For many asset managers, services will shift from advisor-driven advice that is supported by technology to technology-driven advice supported by the advisor.

Here are three ways to be sure your firm is ready for the change. (For related reading, see: Mobile Banking: How Big Banks Are Innovating With Fintech.)

Focus on Value

The first thing you should do is review your business model and ensure that you are offering what your clients want. Then make sure that you are adding value above and beyond what the technology is providing them. Your clients have to know why they are paying you more than they would a robo-advisor. For a client, having an advisor walk him or her through how all the moving parts work together is a great advantage that is harder to do by technology. Explain that you can assist with understanding how estate planning, retirement planning, charity, kids college and large purchases may look like all together.

Partner with a Robo-Advisor

That brings us to a new offering that you should consider: robo-advisor services. Many companies offer a white-label version of their service that you can provide to your clients as if it were yours. (For related reading, see: 10 Fintech Companies to Watch in 2016.)

Back Office Improvement

In the survey, 67% of management said that one of the biggest pressures on the industry was on profit margins. With fintech helping not only on the investment side but also on the analytics side, costs to invest are decreasing. New start-ups are offering a price break to customers due to their reduced costs. In order for you to continue to profit enough to stay in business, you need to take advantage of new technology to streamline your back-office operations.

You should be evaluating which parts of your business you can automate to save you work hours and money. Everything from customer relationship management (CRM) software to your on-boarding process can be automated. 

The Bottom Line

Fintech is here to stay. It will continue to disrupt financial services at an ever increasing rate. To protect your business and profits, you need to embrace technology and make it a priority in your strategy. (For more, see: How Fintech Advances Are Improving Finance for All.)