Firms know one of the biggest advantages they can have with AI is possessing troves of data to train their systems.

The more quality information a machine-learning algorithm can ingest, the more likely it will be able to do things like provide appropriate responses, develop summaries and identify trends. David Chubak, the head of branch development and the U.S. business unit at Edward Jones, thinks his firm is as well positioned as any to furnish the data that bots need to fulfill their promise.

It all starts, he said, with the network of more than 19,000 advisors Edward Jones has in North America.

“If you want to know the pulse of America, every hour we’re having tens of thousands of conversations with clients,” Chubakc said. “We’re learning: What’s their anxiety? What’s the opportunity? And not just for America at large, but for the farmers and the doctors, the rich and the poor, for westerners and southeasterners and everyone in between.”

With clients’ permission, transcriptions of their discussions with advisors can be fed into artificial intelligence systems. The system then can provide summaries and scan millions of conversations for commonly mentioned topics, themes and trends.

The next step, Chubak said, is to use that information to anticipate needs that other clients may not have even mentioned yet.

“How do we get proactive and not just wait for the client?” he said. “It’s by saying, ‘Hey, we see this happening. This may be of interest to you. Can we offer you a potential idea and some advice?”

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Chubak joined Edward Jones in March 2022 amid an overhaul of the St. Louis-based brokerage firm overseen by managing partner Penny Pennington. A greater reliance on AI and other advanced technologies hasn’t been the only innovation.

Edward Jones, for instance, has responded to advisors’ demand for alternative working arrangements. In the old days, Edward Jones representatives usually worked alone, or maybe with an assistant, in branch offices. Now they can join teams or employ the services of associate financial advisors.

The firm has also begun to allow advisors to engage in discretionary transactions — or trade on their clients’ behalf after receiving initial approval — through its Financial Advisor Managed Solutions program. It’s also moving forward with a new customer relationship management system — or CRM — provided by the tech giant Salesforce. And it plans to soon start letting advisors experiment with different fee-based fiduciary models for offering their services.

Chubak, who came to Edward Jones after starting his career at the consulting giant McKinsey and then rising to become the CEO of retail banking at Citi, recently sat down with Financial Planning to discuss his role in ushering in all these changes. 

This conversation has been lightly edited for brevity and clarity.

Financial Planning: One of the strongest cases for using AI is its promise to free advisors from paperwork and rote tasks so they can spend more time with clients. What is Edward Jones doing in this regard?

Chubak: The power of our business in wealth management going forward is going to be defined by AI — not artificial intelligence but advisor intelligence that is supplemented, complemented and grown by the powers of artificial intelligence. That will enable advisors to be not only sharper and smarter and more real-time, but also provide a lot more insight into clients based on network effects of information. 

What it’s doing is building on the strengths and foundation of a network of 19,000-plus advisors. They’re in many more places across the continent and also serving more segments and types of clients than any other firm. 

FP: Do you see AI mainly as a means of summarizing advisors’ discussions with advisors and looking for trends?

Chubak: That’s one of many use cases we can see in the future. We can use tools like Salesforce that now have voice transcription built in. And we’re obviously sensitive to the client’s permission and comfort with it. But we’re now using the new summarization tools and then being able to identify trends using segmentation data. So it’s not just this is a hot topic trending. It’s not just what’s going on on Twitter. It’s what our segments of the population are talking about. How is that shifting? What’s trending? 

FP: Of course, some of Edward Jones innovations not just in technology but in other ways have had to do with the industry’s perennial need to attract and retain top advisors. What has Edward Jones done to make itself a more appealing place to work at?

Chubak: We’re talking to our advisors, and we’re talking to prospects all the time. And I’ll say in the last couple of years, we’re offering more value to more teams more quickly.

And Penny has been pushing us to continue upping our tempo so that we can be delivering more. The themes are pretty straightforward. One is obviously the theme around having greater value for clients. So that’s why we’ve been doing things such as investing a billion and a half dollars in technology, expanding our product and service offerings and our investment advisory offerings to have more personalized, more expansive offerings. 

Then the second area is in choice and flexibility. The trends toward independence are obvious, and we’d be foolish to ignore that. Now individuals and groups of advisors can look and say, “What’s the potential with my practice? And how can I grow the team?” And you not only get the option to do it. You get the practice management coaching consultation behind you to make that happen.

But I want to be clear: We’re not abandoning our old ways. Our model works beautifully. But we’re providing choice. By the end of the year, I expect that close to 20% of our advisors will be in an alternative model.

FP: What makes having these choices so appealing?

DC: Three general things. Our practices are growing significantly, especially if more advisors are looking to offer more comprehensive support. They’ve got great opportunities and they’re sitting there trying to figure out how to make the supply and demand work. And there are only so many hours in the day. So bringing a team on allows you to meet your purpose.

The second is the degree of specialization is growing. Some advisors are really good at relationship building, and not necessarily as comfortable at planning and doing detailed estate work. So we’re seeing advisors now looking to expand that by bringing in partners. That’s not a new model. It’s how the industry has been built for many years. 

And the third is this is an aging business. At Edward Jones, we’re close to 10 years younger than the average age in the industry. It’s 57 in the industry and our average age is closer to 47 or 48. So we’ve got a lot more runway. But we also know there are a lot of people looking to be more deliberate with that succession. They’re thinking about setting up a legacy and planning for years in advance and being a bit more deliberate about that succession comes to life. 

FP: Speaking of keeping advisors happy, Edward Jones is known for rewarding its representatives by allowing them to become partners in the firm.

DC: Our compensation model for advisors is different in that we are a partnership. And, for advisors that meet certain qualifications, we are excited to welcome them into the partnership. 

The firm has now well over 30,000 partners, which is just remarkable to think about the scale and scope of that. 

So it’s not just the typical grid. As a partnership, we offer advisors access to profit sharing.

FP: You’ve also placed an emphasis on helping advisors become Certified Financial Planners — which is often considered the industry’s standard-setting professional certification. How’s that going?

DC: Penny Pennington has a saying: We don’t want to be know-it-alls, we want to be learn-it-alls. So for advisors who have that passion to build their acumen, we want to not just encourage them; we want to finance it.

We’re really proud that in the last few years, we’ve really ramped up the accreditation and designations. We just crossed, a couple weeks ago, 4,000 advisors with the CFP designation. We had 1,000 certified last year. We had 600-some people test in March. I think it’s the largest a single firm has ever brought in in terms of one single test.

Our aspiration then is we want to end the year with more CFPs under our roof than any other firm. We think we’ll end the year close to somewhere between 4,200 or 4,500, which will get us to that. 

FP: How do you go about encouraging advisors to obtain the CFP and other designations?

DC: We’ve made it really easy at our firm. We will pay upfront. So you don’t have to sit there and worry about the money side. We have a whole team of internal specialists and coaches that help people identify the designation you want, work through the process, work with the institutes and put you through the training. And so we really focus on making it easy. 

We also try to be a role model, and a lot of our regional leaders are already designated. I myself will be sitting for the CFP next year. It’s important that our firm leadership show that it matters. 

We’re not saying you have to be a CFP. But we are rolling out more programs and saying we’re going to roll those out sooner to those who have expanded their acumen in different ways. That doesn’t only mean designations. It can mean training programs internally, too. But as we’re rolling out fiduciary planning in the coming year, those who have a CFP designation, we’re going first to test it with them.

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