Adopting a different stance than many of his contemporaries, Merrill Lynch Wealth Management head John Thiel acknowledges there is value in using robo advisors.

An investor is better off with a robo advisor than attempting self-directed efforts, Thiel told attendees at yesterday’s LinkedIn FinanceConnect conference in New York, because robos perform automatic rebalancing of investor portfolios.

Thiel cited a study that found when individual investors work on their own, their portfolio experiences behavioral drag, because most people have a fundamental inability to buy and sell at the right time.

Technology, he said, develops to exploit such opportunities.

“When there’s an absence of perceived value, that’s where disruption can take place,” said Thiel, echoing a question of his peers in traditional wealth management: “Technology is an enabler, so how do we use it to enhance the client relationship?”

Thiel said there is an opportunity for the industry to learn from technology and get better.

“As far as the work we’re doing on millennial clients, the kids of clients and our employees, they want technology but they also want relationships with people if they have questions or need support,” Thiel said. “At a certain stage of life, they are looking for answers online, but [digital channels are] not necessarily a substitute for a relationship with another person.  

“The table stakes, from what we’re hearing from millennial clients and employees, is ‘If your values don’t align with mine, then I’m out of here,’” he said.


Thiel said Merrill has a three-tiered system for attracting and training millennials as employees: the standard training program; a second team-based program for those not aiming for a commission-based sales role; and a third program for non-client-facing roles.

Thiel said the financial industry should expand its recruiting efforts. “We have to make sure as an industry that we’re going everywhere to talk to students, and not just this area of the world, because there is talent everywhere,” he said.

Thiel also shared his views on social media in general and his experience of writing blog posts and publishing them on LinkedIn.

“It turns out me being me is more popular than me being the CEO of Merrill Lynch Wealth Management – I’m a human and I have feelings and a point of view,” Thiel said. “Do I write every word? No, but I actually am very involved with it, because it’s my message, my point of view.


Gerald Hassell, chairman and CEO of the Bank of New York Mellon, agreed with Thiel that technology is both a business-enabler and a potential disruptor.

“We pay close attention to the fintech world – what’s being developed that we should partner with and plug into our platform or compete with,” he said. “We have a big payments business, so should we be afraid of PayPal and Apple Pay, or is that something we can partner with?

“As we build apps and new technology and get information quickly, we want to make that [digital] experience really powerful – everything doesn’t have to be done with a phone call or person-to-person meeting, but if they want to schedule a call to discuss something, we have that channel as well.”

He also shared this perspective on the give-and-take of social media.

“We are encouraging all of our senior executives to get involved, to post their thoughts and pay attention to feedback from employees, how they’re working on products,” he said. “They tell us we’re dumb sometimes. The rank-and-file knows what’s going on sometimes more than senior executives."

Hassell said it is critically important to attract the best and the brightest talent, including millennials. He said he realized that BNY Mellon is not going to be able to move the needle in the technology space if the company doesn’t.

“We have to be able to project to candidates that we’re going to have a positive impact on society,” Hassell said. “We’re also making sure our brand gets out more broadly, so we started innovation labs in New York, Silicon Valley and Pittsburgh.

“Open APIs can be used to enhance apps, so third-party developers that sit with our clients can see these things – technologists and engineers can say, ‘Hey, that’s something I’d like to get involved with,’” he said. “We set up innovation labs not just to attract the best and brightest employees and engineers to work on our apps, but to actually change the way we do business.

“When a client asks for something, we collaborate as a team in a much different way of doing business than the past, allowing people to collaborate on our own internal social network social as teams to solve problems.”

Read more:

Register or login for access to this item and much more

All Financial Planning content is archived after seven days.

Community members receive:
  • All recent and archived articles
  • Conference offers and updates
  • A full menu of enewsletter options
  • Web seminars, white papers, ebooks

Don't have an account? Register for Free Unlimited Access