4 Ways Wealth Management Leaders Can Create Differentiation

Last Edited by: LPL Financial

Last Updated: May 31, 2023

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Ken Hullings, LPL Financial’s Executive Vice President of Enterprise Business Development, recently joined Beacon Strategies’ Managing Director Chip Kispert on the Beacon Flash podcast to discuss this trend and four ways wealth management firms can create differentiation in the marketplace. 

1. Time

“The big hot button [for advisors] is, ‘Do I have enough time to serve my clients in the way that is going to allow me to build the relationship I have with them?’” – Ken Hullings 

Getting to the heart of what matters most to clients and their families takes time—and that’s something many advisors feel they don’t have enough of. Without efficient workflow systems, there aren’t enough hours in the day to build meaningful relationships with clients and keep up with the essential operational and administrative tasks that come with serving them. Wealth management firms that streamline these touchpoints with automated, integrated solutions free up valuable time their advisors can invest back into their clients. 

2. Scale

“What we’ve seen from the financial institutions, product manufacturers, and other broker-dealers we work with is that they’re saying, ‘Ten or fifteen years ago, I thought that running the middle office and the back office and owning the risk was a differentiator, but now it’s really a commodity, and it’s a commodity that I need a ton of scale to actually do well.’” – Ken Hullings

As wealth management firms scale their business, the cost-savings and efficiencies can be felt throughout the company. A good place for the firm’s leadership to start is by examining the number of vendor relationships your advisors are managing for clearing, custody, brokerage, advisory, tech, and business solutions. Integrating these middle and back office functions with a single strategic partner frees you up to spend more of your time, energy, and capacity on the relationships you have with your advisors and teams, which ultimately enhances the relationship that those advisors have with their clients.

3. Innovative technology

“We believe that the best outcomes for families comes from working with an advisor. But at the end day, if you’re an advisor, you can’t just rely on having a great relationship—you need to be able to compete with the digital tools and the experience that other firms are going to deliver.” – Ken Hullings

As our society moves toward more digital, self-service, on-demand experiences, advisors are looking for wealth management firms that are investing in new capabilities that can help them stay ahead of the curve. It’s not just about creating solutions that make it easier to do business, but creating solutions that are on par with the ease and personalization of the other digital apps and services we use. 

Perhaps the most important thing for firm leaders to consider is striking a balance between offering user-friendly digital experiences for clients without detracting from the crucial role of their advisor.  Ultimately, tech should amplify the relationship investors have with their advisors—not replace it. 

4. Modernization 

“One of the segments of the business that we have supported for years is the financial wealth management space. When I think about that space, a mix of brokerage business compared to advisory business is what you might have seen in the independent space 10 or 15 years ago. While at the same time, all of the studies show that customers have a very high level of trust with their local financial institution.” – Ken Hullings

The convergence of these trends provides an exciting opportunity for wealth management firms to deepen their value proposition with advisors by helping them approach more advisory-based conversations with their clients. When customers realize they can also look to your firm for their financial planning and investment management needs, it can deepen the relationship and bolster retention. 

And as more advisors approach retirement, firm leaders have a unique opportunity to reimagine what it means to be an advisor within their firm. Demonstrating your commitment to building strong relationships with your team and providing them with the tools they need to provide quality advice for their clients can lay the foundation for a long-lasting career and partnership.

LPL Financial

At LPL, we understand the value of working with a respected and stable strategic partner who possesses extensive resources and support, advanced technology, and scalable product and service offerings.

If you’re a bank or credit union, contact us to learn more about how LPL can help maximize your wealth management platform’s potential and streamline workflow for your advisors.

If you own your own broker-dealer, contact us to learn how you can leverage LPL to drive additional growth and profitability while maintaining control of your business

Beacon Flash Podcast

Listen to the full conversation with Ken Hullings to learn how LPL helps firms stay competitive and thrive.

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The views and opinions expressed by LPL Financial Advisor(s) may not be representative of the views of other Financial Advisors and are not indicative of future performance or success. Neither LPL Financial nor the LPL Financial Advisor can be held responsible for any direct or incidental loss incurred by applying any of the information offered.

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