Re-imagining the Client Journey

Murray Bender: RBC Investor & Treasury Services is pleased to present insights on the future of asset and payment services across the globe. Today’s podcast features Denys Calvin, Vice President and Chief Operating Officer at Canadian-based Nexus Investment Management, discussing how wealth managers are reimagining the investor experience. Welcome back and thanks for joining us today, Denys.

Denys Calvin: My pleasure. Thank you for having me.

Murray Bender: Denys, to start, can you please remind our listeners about your firm, Nexus?

Denys Calvin: Sure. So we’re a Toronto-based discretionary investment manager and a provider of financial planning services, really target at private clients. We have some not-for-profit entities that are clients as well, but it’s mostly a private client business. We manage about 2.5 billion for nearly 600 families. I would describe our approach as the traditional long-only North American equities plus Canadian dollar fixed income. We do our own research and security selection and offer the investment management experience through both segregated portfolios as well as units in a handful of pooled funds that we manage.

And the business has been around since ’88. We’re 20 strong at this point. And as of February last year, we’re wholly-owned by New York-based Focus Financial Partners. But we Toronto residents continue to run the operations, so we describe ourselves as independently managed by the employees.

That’s us.

Murray Bender: We hear a lot these days about how wealth managers are reimagining the investor experience. What’s driving the need for managers to evolve the experience of their clients?

Denys Calvin: Interesting question. Frankly, you’re probably picking up more of this than we are kind of because we have our heads down doing the usual block and tackling of managing portfolios, attending to clients, and just trying to build the business. But I think what you say is true in the sense that we have to think about what clients want that they’re not getting and/or might want that we ought to be preparing ourselves to be able to provide.

And so, you know, the drivers, like what’s driving the need to think about this experience, it’s kind of our perception of what clients want, and some of that perception is based on actual conversations with clients and requests they’ve made, but also just sort of you can’t help but look left and look right at what your competitors or fellow fishermen are doing and noticing oh, that’s a clever idea, maybe we ought to get ourselves one of those. So that’s part of it.

And invariably, you’re doing some streamlining or reengineering or overhauling of processes and what have you, and as a come along with those exercises, you say to yourself, well, as long as we’ve got the hood open, is there something we should be changing here that’s going to make it better for clients? So there’s that.

And then just a general desire to kind of keep our offering fresh. And I don’t think we’re peculiar in that respect. So I think other managers are probably picking up the chatter from clients, seeing what their competitors are doing. They’re making changes to the way they do things, and in so doing making things better for clients, and they too are probably trying to keep their offering fresh.

Murray Bender: So can you share some of the initiatives that Nexus is undertaking to refresh your client offering?

Denys Calvin: Yeah. I could certainly talk about the things that are going on in the here and now in no particular order. We’ve had our first. Let me back up. Our traditional approach to doing group functions with clients was to cram them all in a room at the National Club or maybe in our large boardroom and serve them crustless sandwiches on a mahogany table and chatter to them, and, of course, since March 2020, poof gone. So we’ve pivoted completely to virtual events as everyone else has, and what has been an introduction in 2021 is what I would describe as the celebrity guest speaker.

So Morgan Housel, who is author of The Psychology of Money, a book I can highly recommend, did an event with us and for our clients earlier this year. And Matt Ridley, the author of The Rational Optimist, is going to be the keynote speaker at our annual client event next month.

So, rather than just having one of us chatter and talk about things, we’re bringing in some, as I say, “celebrity” guest speakers, and I don’t think we’re unusual in it at all, but we’re spicing some of our blogs with a video here or there just to give our blogs a bit more of a multimedia experience and being more than just text.

Probably the biggest thing is a project that we have underway to identify opportunities to improve the client experience, generically defined. And one way to think about that, and it’s one of the ways we’re thinking about it, is to look at the client journey, as the expression goes, and sort of consider all aspects of that and what can we do at each of those stages of the client journey to make it better for clients.

So that like the waypoints on that journey would include when someone is a potential client and considering us, what’s their experience like. When they decide okay, I like the looks of these folks, I’m going to sign up, so that’s another waypoint.

Then there’s, if you will, the ongoing experience as a client. And then there are what you’d call events in the client’s life cycle. You know, their kids get old enough to have accounts for themselves and so the parents want to set up something for their kids, and want their kids to get some sort of an education and experience about investing. So we want that to be useful and valuable for the parents and for the kids.

And then as people transition to become empty nesters, there are usually some things related to that that affect clients, and retirement and death are two fairly obvious significant life events, if you will, that have an impact on their relationship with us.

And the overarching goal of this whole client experience improvement project, if I could call it that, is to make it so that Nexus is client friendly and that those things that clients expect to be easy to do are at least as easy to do as they expect them to be.

And, Murray, I think as I maybe said to you once before when we had a discussion like this, sometimes the client doesn’t come to the particular task or experience with any expectations about how easy or how hard it’s going to be to do. So, as we think about those things, we try and make it so that the client, when they’re finished with it, says, oh that was easy, whether or not they anticipated it to be easy or difficult before doing it, if you follow me.

So, that’s as I think about what we’re doing to, as you put it, reimagine the experience, that project is probably the biggest single thing.

Murray Bender: So, finally, Denys, can you paint us a picture of the client experience that you envision, say, five years down the road?

Denys Calvin: All clients in space. That was one of my colleagues who's managing this client experience improvement project that I alluded to and I, pinged her and said so what do you think? That was her instant response and, obviously, tongue in cheek.

In many ways, look, the fundamental needs that clients of ours have of us aren’t changing. And they’re not going away anytime soon. So I’m not sure that there is a revolution in the client experience between now and five years from now. It’s almost certainly going to be more of an evolution. And that’s partly because these things are, to one degree or another, big projects and so you don’t just kind of light them up all of a sudden.

And the other thing is like you want the clients to be with you. I mean it’s all well and good to be the band leader, but if you march too quickly and turn too many corners and the band doesn’t follow you, like it’s not much of a parade. So this is going to be a gradual, as I say, evolution.

What I think is going to change if the needs, the fundamental needs the clients have aren’t changing, I think what will change/evolve is how we meet those needs. So just a couple of examples of things. In the last, let’s call it, two years, we’ve clearly had to change a bunch of process-type items so that they’re not reliant upon paper. But guess what? Lots of the way we do things are just electronic versions of the same paper. It’s PDF forms and what have you.

So what’s going to change over the next five years, we’ll probably figure out clever ways to evolve processes that had their origins in paper so that they’re not just PDF versions of the paper, but are interactive, more fluid versions of the same processes, you know, thinking of gathering information from clients and keeping it current.

And related to that is reporting to clients. We don’t feel compelled to report to clients on anything close to an instant basis, and I don’t imagine that will change. But clients probably would like to be able to poke away at and dig a little deeper in some of the things we do report to them. And right now, all they’re essentially getting is PDFs of the RBC statements that you folks so capably produce for them and they get our quarterly reporting. But it’s a sort of look-but-don’t-touch kind of experience. You know, could we evolve that so that you get that plus the ability to drill in a little bit? Sure, I can imagine that.

And then the other thing and it’s going to go back to this comment I made a moment ago about the client journey or the client life cycle. We’re probably going to try and find ways to meet other needs that clients have that are contiguous to the investment management wealth planning experience.

For example, as clients get wealthier and as they age, one of the things that enters many clients’ minds is some desire to do something philanthropically. They’ve got the wealth. So can I imagine us doing something helpful to facilitate clients’ desire to give away some of their wealth? Sure.

I don’t think we’re going to get into the business of advising them on what to donate to. There are a bunch of outfits that do that quite capably. We don’t need to do that. We’d be no better at that than we are at market timing. But there are a bunch of, I would call them, executional things related to that, would help make it easy for clients. So I can picture that as part of the investor experience, or the client experience, over the next five years.

And then the other thing is we have a sort of funny lens through which we see and understand clients. Like we’re investment managers and we’re financial planners. And so, through that lens, we have an opportunity from time to time to offer advice or thoughts on whatever it is the client’s facing. A classic very simple example to articulate is lots of Toronto-based clients are wringing their hands about how their young adult children are going to afford a home, and I personally am in that boat, too.

And so one of the questions we get is look, what do you think? I’d like to give my child a few hundred thousand dollars or I’d like to help them buy a home. So that whole conversation about supporting the children is the conversation, but we can answer the narrow question of Mrs. Smith, can you afford to give $200,000 to Buffy to help her buy a condo? But that conversation can then broaden to, what’s the most effective way to deliver that support to Buffy in a way that doesn’t mess her up?

So this is not the question of whether you can afford it not, this is like do you lend it to her? Do you give it to her? What about her partner and what happens if they split up and what does that mean for the money?

Anyway, it’s those sorts of, I would say, very qualitative dimensions of what starts out as a very narrow specific financial question. We have an opportunity to weigh in, I supposed you’d say, on those things and offer perspectives, and potentially link the client up with some other professional who is quite capable and expert on whatever that topic is. And it could be somebody whose kids have moved away to faraway lands who now finds themselves as an empty nester alone in Toronto and wondering, okay, well, this is all well and good financially, but I’m not sure I’m good with this from a lifestyle perspective. Well, you know, there are folks we know who can be a sounding board to that client.

And so I imagine the client experience over the next five years will evolve to be able to very selectively offer, as I say, advice, thoughts, referrals, if you will, to folks who are thinking about some of those qualitative issues in their life that are contiguous to a financial decision.

Murray Bender: Some great food for thought, Denys.

Denys Calvin: Yeah, I mean, it’s a bit of a—I’m sort of rambling over the shop. I’m sorry. But it is very much a—it’s consistent with this theme of evolution as opposed to light switch changes that I think.

Murray Bender: We really appreciate your time, Denys. Thank you very much.

Denys Calvin: Murray, it’s my pleasure.

Murray Bender: Today’s podcast has been brought to you by RBC Investor & Treasury Services, and we hope you found it useful. For additional insights on the future of asset and payment services, including our previous podcasts, visit I’m Murray Bender. Thanks for listening.

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