Skip to content

This Job Could Survive When Robots Take Over

A few weeks ago, I had the honor of spending a fascinating few days in Aspen, Colo., where I was invited to participate in Fortune’s annual Brainstorm Tech conference. The event always draws an inspiring group of tech and business leaders discussing the future of work, entertainment, health, and society, and this year was no different.

Clara Shih Fortune Brainstorm Tech
Photo credit: Fortune/Stuart Isett

On the heels of Disney chairman and CEO Bob Iger’s thoughts regarding the future of virtual reality-enabled immersive experiences, I joined a debate with Wealthfront CEO Adam Nash, Ellevest CEO Sallie Krawcheck, and Felicis Ventures founder Aydin Senkut, to explore the future of financial advice.
Among the questions asked, two particularly struck a chord:
Will algorithms replace human advice? And if so, what will become of the hundreds of thousands of financial advisors and agents out there?
I believe that rather than it being a case of humans versus machines, the future of financial advice more likely lies somewhere in between, where human advisors leverage artificial intelligence and automation to become smarter and more efficient at doing their jobs. But to get there, they must change, and they must start now.
The questions brought to mind a recent McKinsey report that analyzed more than 2,000 workplace activities across 800-plus occupations. The report concluded that across the economy, jobs can be classified into three buckets.
In the first bucket are professions where the majority of workplace activities are routine and process-oriented. These almost certainly will be fully automated or already have been. Low- and middle-skill manufacturing jobs, legal research, and drivers come to mind.
At the other end of the spectrum, jobs that literally or figuratively involve a human touch, such as massage therapists, psychotherapists, clergy, and dentists – at least for now – are relatively safe from being replaced by artificial intelligence.
In the middle bucket are the vast majority of jobs, which likely aren’t going away anytime soon but whose nature will become fundamentally transformed as a result of available technologies.
I believe financial advisors fall into this middle bucket, and not the first bucket that some may predict. While robots won’t completely take away financial advisor jobs any time soon, they will certainly be significantly altered. Millennials and Gen Z clients still prefer to speak with a human advisor, but most human advisors today are out of touch and difficult to access, especially as younger clients spend most of their time on digital channels such as social, email, search, and text.
The rise of roboadvisors, or automated online advice, combined with ongoing regulatory changes and the Department of Labor’s recently passed fiduciary standards mean that advisors must completely rethink how they spend their time and engage with clients and prospects.
Many traditional financial services firms are modernizing inefficient investment management practices by white-labeling or building out their own automated advice platform; UBS, for example, announced its partnership with roboadvice provider SigFig earlier this year.
On the client engagement front, many firms are working with tech companies such as mine, Hearsay Social, to completely overhaul and modernize how their advisors prospect, deepen, and grow client relationships through social media, mobile-optimized websites, email insights, and texting. Advisors can work smarter  – not just harder – and focus on the human touch, which is still valued by their clients and which only they can provide, especially during important life decisions.
Finally, one area my panel did not get a chance to discuss  – but would have certainly made for a lively debate –  is how automation is best suited to predictable environments. Whereas financial advisors have the ability to personally reassure and advise clients during sudden market downturns (indeed, those are often the worst but most tempting times to sell), it’s unknown how roboadvisors would respond and guide clients. Just a few weeks ago, the algorithms created and used by roboadvisor Betterment halted all trading when markets dropped in response to the Brexit vote, to the surprise of many. How automated activities might play out in the face of sudden volatility remains to be seen.
This article originally appeared in Fortune.

Clara Shih

A pioneer in the social media industry, Clara developed the first social business application in 2007. Her latest book, The Social Business Imperative, is a Wall Street Journal-featured bestseller. She is a member of the Starbucks board of directors.

Visit the Resource Center

Download White Paper, Infographics, Industry Reports and More…

Visit Resources