In an era where personalisation has become a benchmark of quality service—whether in healthcare, retail, or entertainment—investors are increasingly expecting the same from their financial advisers, not only because of the ‘feel’ of the service, but also the financial outcomes. Regulatory mandates such as the Best Interests Duty in Australia or the Consumer Duty in the UK reinforce this expectation, requiring that recommendations be tailored to each investor’s unique circumstances, preferences, and objectives.
Yet, in practice, delivering this level of personalisation often creates an operational and economic strain for advice businesses. And therein lies the growing tension: how can firms deliver an investment proposition that genuinely serves each client’s best interests without incurring unsustainable effort or cost?
The Promise—and Cost—of Personalisation
When advisers tailor portfolios to client needs—factoring in tax status, ethical preferences, concentrated holdings, income requirements, or risk tolerances—they deepen trust, improve client engagement, and meet fiduciary obligations. Done well, this can be a powerful differentiator.
But this level of nuance often comes at a cost. Manually tracking individual client preferences, maintaining spreadsheets, ensuring consistent application of model changes across bespoke accounts, and documenting compliance for every action can introduce immense overhead. Multiply this across hundreds of clients, and the promise of personalisation quickly becomes a burden on capacity, resources, and profitability.
The Efficiency Trap
In response, many firms adopt model portfolio based managed account products and services to standardise portfolio delivery. These bring operational efficiency and scale—but most often sometimes compromise the personal touch, and the feelings associated with it.
The risk here is a “one-size-fits-most” approach that may technically comply with regulations but falls short of client expectations and feels like ‘one size fits none’. It can also invite scrutiny where regulators or clients challenge whether the portfolio truly aligns with the investor’s needs—or whether the solution was selected for ease of implementation.
Navigating the Middle Ground
The future of investment advice lies in balancing the scale benefits of model portfolios with the flexibility to tailor. Increasingly, technology is making this possible. Algorithmic systems that allow for “mass customisation” can jump to the new level of ‘mass personalisation’ to apply personalised rules to individual portfolios—with blending in of automated decisions around asset substitutions, tax preferences, or ethical exclusions without needing to break the model entirely.
By embedding rules-based engines and intelligent agents into portfolio management, advisers can retain the consistency and discipline of centralised models, while delivering tailored outcomes at scale. This represents a step-change: from labour-intensive personalisation to smart, scalable personalisation.
A New Standard for Client-Centric Advice
Ultimately, the goal is not to abandon efficiency in pursuit of perfect personalisation—nor to forsake the client’s best interests for the sake of margin limited by out of date processes. It’s to reimagine how investment propositions are delivered in a way that meets the expectations of the modern investor: aligned, responsive, and distinctly theirs.
The firms that solve this tension—through the smart application of technology and process design—will not only meet regulatory expectations but will likely command the trust and loyalty of the next generation of investors.
