Advisor Intelligence

There’s an App for That, But Maybe That’s Not a Good Thing

If you walk into the exhibit hall at any financial advisor conference, you’ll be amazed at the number of “technology solutions,” “platforms,” and “software.” These days, there are technology applications for automating nearly everything an advisor does—from prospecting for clients and social media, to asset allocation and portfolio rebalancing.

But for some things advisors do, I believe technology just doesn’t work. No technology can replace an advisor’s personal relationship with the client. Yet, there probably is an app for that.

Don’t get me wrong; as a Gen Y-er, I grew up on technology. And it’s hard for anyone to meaningfully criticize the advancement in technology. But when does technology just go too far?

I was inspired to ask this question after reading an op-ed by Evgeny Morozov, author of the new book, To Save Everything, Click Here: The Folly of Technological Solutionism. Morozov seems to offer a funny yet incredibly intelligent critique of technology and the app-bonanza coming out of Silicon Valley. (Might be a good book to pick up.)

Morozov’s thesis: Technology cannot fix every problem. Those who think it can are called “solutionists,” a phrase he coined. “Solutionism” can be a dangerous thing, he says:

All these efforts to ease the torments of existence might sound like paradise to Silicon Valley. But for the rest of us, they will be hell. They are driven by a pervasive and dangerous ideology that I call “solutionism”: an intellectual pathology that recognizes problems as problems based on just one criterion: whether they are “solvable” with a nice and clean technological solution at our disposal. Thus, forgetting and inconsistency become “problems” simply because we have the tools to get rid of them — and not because we’ve weighed all the philosophical pros and cons….

Solutionists err by assuming, rather than investigating, the problems they set out to tackle. Given Silicon Valley’s digital hammers, all problems start looking like nails, and all solutions like apps.

And he backs up his assertions with specific examples:

Solutionists do not limit themselves to fixing the problems of individuals; they are as keen to fix the problems of institutions. Civic-minded start-ups like Ruck.us, which helps people create and join political movements, seek to bypass the conventional party system and allow individuals to practice politics without any mediation by institutions, on the assumption that the only reason we needed representative democracy in the past was because the communication costs were too high. Now that digital technologies have lowered the costs of participation, political parties can go the way of the dodo and be replaced, ad-hoc style, by online groups of concerned citizens.

It’s hard to defend America’s current political system, but it’s even harder to rally behind the solutionist project for one simple reason: the proposed Internet-powered “solution” is not sold to us based on its inherent merits — of those we hear very little — but, rather, on the demerits of the existing system, be it partisanship or sleaze. Yes, the current system teems with imperfections, but imperfection might be the price to pay for a half-functioning democracy.

Perhaps us media folk are the biggest offenders; we’re only too willing to point advisors to the newest technology that will change the business, or the answers to advisors’ biggest dilemmas. After all, how many headlines read, ‘There’s an App for That’?

That said, we all know too well how tablets, smartphones and web-based programs have made our lives easier. Of course there’s a place for technology, and it’s useful for advisors to learn about what providers have to offer. My purpose in writing this is only to say Morozov has a point, so watch out for “solutions” that just aren’t necessary. And try leaving your iPhone at home for a day or two; it's liberating.

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Diana Britton

Diana Britton is the Managing Editor of WealthManagement.com and REP. Magazine, covering asset management and independent broker/dealers from all angles. A native of Los Angeles, she now lives in...

Megan Leonhardt

Megan Leonhardt regularly pens articles around the wonderful world of the wirehouses, as well as pieces concentrated on regulatory updates, legal cases and compliance issues. A business journalist...
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