Paid Program: The Craft of Finance (2024)

Defining Craft Today

Craft, in the modern context, showcases a unique blend of passion, effort and centuries of expertise across sectors, maintaining tradition while championing innovation. The resurgence of métiers d’art (“masters of art”) in Swiss watchmaking, for example, preserves deep generational knowledge. While its time-honored techniques remain, watchmaking has incorporated new materials like silicon over the years to improve durability. In any craft, leveraging the best of the past builds a foundation that lets you differentiate yourself based on ‘how’ you do things. This approach extends beyond tangible goods to high-tech services. Modern craft combines multidisciplinary talents, deep experience, creativity and ‘old-fashioned’ service values in industries such as precision medicine, bespoke real estate and experiential retail. As a result, success relies on effectively blending these factors to arrive at a solution centered on people’s needs.

Finance as a Craft

Today, craft has found its way into finance, emphasizing care, precision and personalization. But the increasing complexity of financial markets and investment products can make it difficult for individuals to make informed decisions, says Mark Haefele, Chief Investment Officer at UBS. Factors such as deglobalization, digitalization and decarbonization have led to government intervention in markets and the disruption of traditional investment models. “These factors are making investing without expert guidance more challenging than ever before,” notes Haefele. “Simply understanding a corporate balance sheet is not enough to navigate this complex environment.”

So how can today’s wealth managers, like artisans, provide a high level of care to meet each client’s unique financial goals?

When it comes to choosing whom to trust with their finances, a 2022 wealth management study in the US and Canada reveals that over 60% of high-income earners¹ appreciate personal interaction, and 78% are willing to pay a premium for tailored services. This shift in demand for wealth-as-a-service requires a holistic approach so that clients receive the personalized support to work towards creating lasting financial legacies.

“Our experts need to be able, affable and available,” says Haefele, referring to the Chief Investment Office team of specialists across 11 financial hubs. “They must possess a diverse range of talents and specialties, such as deep subject matter expertise, a love of working in teams and with clients, open-mindedness to respond to market changes and the ability to craft effective solutions at any point of clients’ investment journeys.” This combination of factors results in financial strategies designed with the client at the center.

¹Simon-Kucher 2022 Wealth Management Study

Innovation as a Tool

Today’s largest and most successful organizations and investors use data to their advantage when making high-impact decisions. However, with the exponential growth of data, the quality and utility of it can be called into question. “A lot of data is available today, but much of it is simply hard to use, so we focus very closely on quality,” says ​​Dan Dowd, Head of Global Research and UBS Evidence Lab. Over the past decade, UBS Evidence Lab has built proprietary, compliant systems that source, process and cleanse large amounts of data to create differentiated datasets covering major sectors and regions in the world. As a result, analysts at UBS leverage this data powerhouse to help answer pivotal questions and uncover insights that can drive innovative investment strategies. UBS Evidence Lab’s Global Merchandise Planning Monitor, for example, tracks 180 brands across 26 countries. This allows fashion and retail analysts to make the most of the troves of data by analyzing pricing changes and promotions based on inventory levels to keep their clients ahead of market movements.

We start the investment planning process with three fundamental questions: How can we help improve your life today? How can we improve it for tomorrow? And how can we support you in helping others?

Mark Haefele, Chief Investment Officer, UBS.

Crafting the Balance

Technology can serve as an innovation enhancer for human expertise. For example, in wealth management, technology can monitor and adjust investment strategies in real time while maintaining a service-focused human touch. This integrated approach combining technology and people skills can result in a more personalized and effective approach to financial health. “Technology is only an enabler,” says Haefele. “A sore back may have you looking for symptoms and treatments online, but if your pain persists, you’ll likely see a doctor you can trust.” Just as each human body is unique, personal investment situations require a trained professional to choose and conduct tests, interpret conflicting signals and collaborate on a personalized strategy for financial health. The benefits of a tailored investment plan are often underestimated, he explains. “We start the investment planning process with three fundamental questions: How can we help improve your life today? How can we improve it for tomorrow? And how can we support you in helping others? Part of that answer is ensuring you have the optimal allocation to cash so that you have the right mindset to invest. That can be a very personal discussion.”

Going Beyond Tradition

Keeping on top of emerging market disruptors requires an unconventional approach that combines lateral thinking with continuous learning and adaptability. By staying open to new ideas and embracing innovation, advisors can better navigate the industry’s ever-changing landscape. This allows them to identify potential risks and opportunities while also providing solutions that go beyond traditional financial services. UBS Evidence Lab’s Brand Tracker datasets, for example, offer insights into consumer behavior across social media platforms, mapping out potential game changers across sectors. “Clients closely follow these trackers, often requesting additions to monitor newcomers and gain early insights,” says Dowd.

Beyond algorithms and analytics, true resonance with today’s investors combines these elements with the age-old principles of craft, which rely on invention, trust and intuition. Using current tools to master a personalized, human-centered strategy lets banks meet people where they are in their financial journeys, making a lasting and meaningful impact in the digital age.

A lot of data is available today, but much of it is simply hard to use, so we focus very closely on quality.

Dan Dowd, Head of Global Research and Evidence Lab, UBS.