How can a robot deliver advice?

Robot thinking close up

Let’s not throw out the baby with the bath water

You already know my position on the over-use of “disruption” in the business world. Now I am adding robo-advice to my list of catchphrases to question. Whilst robo-advice in the financial planning world is not new, I object to the term “advice” being linked to robotic platforms and seen as a shiny new business model.


How can an algorithm-based piece of software manage wealth and advise on retirement plans? Whilst it can certainly speed up information and data processing, and provide some level of recommended action, a robotic system cannot – and should not – replace human expertise and intellect.

In holistically embracing all things robotic, we risk ignoring the huge advantages that digital platforms offer to enhance the ability of advisers to do what we’re paid to do – that is, craft recommendations for our clients that help them achieve the outcomes they’re seeking.

Let’s not throw out the baby with the bath water as we chase new revenue opportunities and streamlined service delivery.

The Oxford Dictionary defines advice as “guidance or recommendations offered with regard to prudent action”. I can’t say I’ve seen any robo or digital platform that can determine an individual client’s perspective on “prudent action” as it pertains to their personal circumstances.

Now this is not to say I don’t wholeheartedly embrace any platform that can drive efficiencies, reduce the need for replication of effort and deliver a seamless service to advisers and their clients.

In fact, I have been part of a team that recently launched an online Estate Planning platform called Yodal (yodal.com.au). The service evolved out of years of frustration in connecting the vital need for Estate Planning to our clients actually doing something about it. Whilst most of us recognise the value of Estate Planning, the bridge to engaging in the process is paved with obstacles and excuses.

The Yodal team saw the perfect opportunity to speed up the process, remove barriers for advisers and their clients, streamline information and data input, and automate the production of Estate Planning documents for legal review.

What Yodal does NOT promise is advice. It delivers a recommended Estate Plan based on the data provided, but with review built in that removes the risk for advisers in taking on legal advice. Yodal ensures that human expertise remains integral to the process in the form of a lawyer reviewing and finalising the documents.

The entire premise of Yodal is that it integrates Estate Planning into existing businesses whilst retaining high quality, personalised relationships between advisers and their clients.

The baby remains safely in the bathtub!

There is so much hype and hyperbole in the market regarding robo-advice, it’s easy to adopt a myopic viewpoint and convince yourself as an adviser that you’ll be out of a job in 10 years. Not going to happen if you remain curious, seek to continually improve and innovate your service delivery, and build closer bonds to your clients.

I defy any system to get to the point that a client would take its so-called “advice” over that of a trusted individual who has built up a relationship over time and proved they deliver on their promises.

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