Private Wealth Best Practices – Domain Knowledge Scan (DKS) December 2013 © Internal Consulting Group 2015 PIRVATE WEALTH BANKING – DOMAIN KNOWLEDGE SCAN COMMERCIAL IN CONFIDENCE Confidentiality Our clients’ industries are extremely competitive. The confidentiality of companies’ plans and data is obviously critical. ICG will protect the confidentiality of all such client information. Similarly, management consulting is a competitive business. We view our approaches and insights as proprietary and therefore look to our clients to protect ICG’s interests in our proposals, presentations, methodologies and analytical techniques. Under no circumstances should this material be shared with any third party without the explicit written permission of ICG. Disclaimer ICG has made good faith efforts to ensure that this material is a high-quality publication. 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The user is allowed ‘fair use’ of the copyright material for non-commercial, educational, instructional, and scientific purposes by authorised users. © Internal Consulting Group 2015 PIRVATE WEALTH BANKING – DOMAIN KNOWLEDGE SCAN 2 COMMERCIAL IN CONFIDENCE Domain Knowledge Scans (DKS) Domain Knoweldge Scans DKS Domain Knowledge Scans Domain Knowledge Scans (DKS) are an effective way to ensure your team is exposed to the very latest thinking in your industry, sub-sector or function Assess the very latest thinking, practices and insights and share with your team in report form and/or via a 2 hour briefing session. • A unique highly distilled synthesis of the newest thinking in your industry, sub sector or function • Can include critical ideas, frameworks, case studies, insights • Garnered from relevant peer markets across consulting and advisory firms as well as academia and industry • Includes a stimulating presentation to your team and or an extended audience • Includes references for further review and investigation • Ensures your team’s expertise is current • DKSs are a companion resource to our monthly global periodical The Insights Review (TIR) and deeper full dives on a specific topic – our Knowledge Area Reviews (KAR). © Internal Consulting Group 2015 PIRVATE WEALTH BANKING – DOMAIN KNOWLEDGE SCAN 3 COMMERCIAL IN CONFIDENCE DKSs are one of many innovative research tools for internal consultants and executives ICG RESEARCH PRODUCT TAXONOMY Depth Deep GES – Global Expert Scan DKS - Domain Knowledge Scan Cost: $10K Cost: $5K TIR – The Insight Review Cost: $100 / year ERT – Expert Round Table KAR – Knowledge Area Review Cost: $5K+ Cost: $20K Deeper Upon Request Semi-annually Monthly Periodicity © Internal Consulting Group 2015 PIRVATE WEALTH BANKING – DOMAIN KNOWLEDGE SCAN 4 COMMERCIAL IN CONFIDENCE Private Wealth Banking Global Best Practices - Content Section Component Description • Key published articles: High End Wealth and Private 1 Key Articles Banking in the past 12 months 2 Key Case Studies • Selection of Best Practices cases around the globe 3 Critical Frameworks • Key frameworks and important insights © Internal Consulting Group 2015 PIRVATE WEALTH BANKING – DOMAIN KNOWLEDGE SCAN 5 COMMERCIAL IN CONFIDENCE Key published articles: High End Wealth and Private Banking Key Articles Insight Review # Article Title Summary A short and relatively sweet piece focused on two key topics. The first, technology enabled advice, through tablets, social media enable benchmarking, “2013 Wealth & Asset and technical advice is a reminder of just how much impact digitisation has already had. The second, price realisation, offers a general step by step Dec- Jan 2013 Management Industry project plan for those who have allowed discounting and stagnant pricing to get out of hand. Booz suggest that price realisation can produce the cash Perspective” – Booz flow to catch-up in the digitisation arms race. Essential reading for the post-commission world. Based on UK data and regulation (Retail Distribution Review and Adviser Charging) this “Bridging the Advice powerful article is a wake up call for all sectors hit (or soon to be hit) by transparent charging regimes. The numbers are shocking – up to Gap: Delivering a third opting out and even more high value customers reducing usage. The article is well written, beautifully presented and not all doom and gloom, as it shines the spotlight (with innovative but clear supporting analysis in Figure 7 and 8) on four disaffected segments: Dec- Jan 2013 Investment Products in a disenfranchised wealthy; mass affluent and mass market orphans; and tech savvy savers. A deserving winner of our article of the month award. Post-RDR World” – Deloitte “Fortune Favours A comprehensive ‘how to’ guide to internal consulting teams on exploring globalisation opportunities. While applied to the Private Banking/HNW segment, much of the thinking is easily translated to other segments. The insight includes global, summary level insights on relative growth rates and selected Choice, not Chance: How country specific insights, but it is the elaboration of the consulting process and the identification of variables for country-by-country level analysis which Wealth Management shines through here – a great article and worthy winner of our article of the month.. Feb - 2013 Firms can Pave the Way to Growth in New and Emerging Markets” – PWC This title should be “The Institutionalisation of Hedge Funds drives the need for robust and transparent operating models”. A key highlight of this now $2 trillion global industry includes the astonishing growth difference between small and large firms: the over 1B enjoy 12-13% CAGRs, the smaller funds only “The New Challenge for 1%. Internal consulting teams at hedge funds will benefit from the laundry lists of key success factors for both the operating model and the back office. Hedge Funds: Interestingly, this article breaks with BCG ranks and includes an uncharacteristic call to use outside help if your hedge fund is running a transformation. Feb - 2013 Operational Excellence ” – BCG Only half its reported length, this US based survey of wealth customers and their advisers highlights some meaningful gaps in understanding between the “How Tech-savvy parties and the role technology can play to close them. Examples include: advisers overestimating their client’s investment expertise, underestimating Advisors Regain their risk aversion (post GFC), and overestimating the strength of the relationship. The report then highlights how new technologies such as social Apr - 2013 media and online learning can help to close these gaps. Gen D Investor Trust” – Accenture © Internal Consulting Group 2015 PIRVATE WEALTH BANKING – DOMAIN KNOWLEDGE SCAN 6 COMMERCIAL IN CONFIDENCE Key published articles: High End Wealth and Private Banking Key Articles Insight Review # Article Title Summary “Global Wealth 2013: BCG, in their thirteenth annual report on the global wealth management industry, present a comprehensive and data-rich profile, with some thought- provoking commentary on key trends shaping the industry over the next five years. The report continues the story from the 2012 report of ‘rebound’ in the Maintaining post-crisis era, draws out the industry divide between ‘old world’ and ‘new world’ economies, and presents (Exhibit 7 on page 15) an interesting Momentum in a Complex benchmarking of growth, productivity and efficiency for wealth management institutions and banks across the geographic regions. The report makes May – June 2013 World” much about the increasingly complex market and operating environment in the post-crisis era for wealth managers everywhere, and lists no less than ten – BCG critical steps that wealth managers must take in response. Developing new IT and big-data capabilities to support business agility, information dissemination, and interacting with clients and advisers using social media stand out as some of the more challenging actions. Wealth management CEOs and heads of private banking groups will benefit from the industry overview, but will still be left with the challenge of determining priorities across the report’s wide-ranging recommendations. “Evolving Investment At some 80 pages, this report is a comprehensive but lengthy overview of the current state of financial services regulatory reforms impacting investment management globally. The executive summary is probably all the general reader needs to skim. It provides a broad sweep of the key drivers for Management regulatory change – investor protection, capital markets changes, tax reform, financial systems stability – and profiles the major regulatory initiatives (an Regulation: A Light at the ‘Abbreviations Guide’ on Page 75 is a helpful compendium of the new regulatory acronyms). It also calls out the major challenges in implementing the July - 2013 End of changes,