Human advisers and robo advisers, once thought to be competitors, will likely become partners in the years to come.

“Just like technology has altered and changed every industry, it is beginning in wealth management,” said Timothy Welsh, a certified financial planner and president of Nexus Strategy. “While the digital platforms have been around for a while, it is just now that we are starting to see their platforms start to become mainstream.”

Consider how two organizations, one the entity that oversees certified financial planners and the other, the association representing certified financial planners, are approaching the brave new world of human and robo advice.

• The CFP Board Center for Financial Planning in December released the findings of a panel of experts who explored the future effects of digital advice on the financial planning profession, according to a release. The CFP Board, the regulatory body for the nation’s certified financial professionals, said its panel of experts sought to identify the challenges and opportunities financial planners face as the worlds of human and automated financial advice collide.

• The Financial Planning Association (FPA) announced, also in December, that Betterment for Advisors would become a strategic partner of the nation’s largest association for certified financial planners. Betterment for Advisors will, among other things, teach the FPA’s 24,000 members “how digital investment advice can augment the robust financial planning services they are providing clients while staying true to the high-touch level of advice they are already providing,” according to a press release.

Experts largely praised the efforts by the FPA and CFP Board to better understand how human and robo advisers can work together in the future. “From these announcements, it appears that these two organizations are recognizing that the delivery of financial advice will be different in the future, and if they are to remain relevant for their members, they need to start building content and practice standards that include digital capabilities,” Welsh said. “In fact their very futures as organizations depend on the human adviser being primary, and if the adviser job goes away than there won’t be a need for them anymore.”

In its research, the CFP Board’s digital advice working group, using a scenario-planning approach facilitated by Heidrick & Struggles, created a matrix of four potential future outcomes that took into consideration the nature of consumer demand for integrated advice and the level of consumer trust pertaining to the digital experience.

The four scenarios were:

• Everyone goes digital: In this scenario, the same sophisticated digital advice platforms underpin both the direct-to-consumer online experience as well as the tools used by human financial advisors.

• Judgment day: This scenario assumes that digital advice accelerates to the point of ubiquity, with some form of financial advice available for free to most consumers.

• Rise of the humans: In this scenario, growing complexity of financial products extends the time horizon to realize greater automation of financial advice.

• Back to the future: In this scenario, a cyberattack directed at an online digital advice platform turns consumers away from human-less systems and drives a preference for the financial adviser.

To be fair, at least one expert suggested that the scenarios might mesh together in reality. “While each of the four discrete scenarios in the CFP Board paper are all possible outcomes in the future, I believe the future of digital advice will evolve to include elements of all four scenarios,” said Bill Winterberg, founder and president of FPPad.com.

No matter whether the CFP Board’s scenarios are discreet or not, another expert sees the need for financial advisers to contemplate all scenarios.

“The simple fact that investors are increasing integration of digital communication into every aspect of their lives is going to necessitate the transformation of their financial advice relationships,” said Scott Smith, director of research at Cerulli Associates and a member of the CFP Board’s digital advice working group. “Investors’ expectations of what an advice provider will be able to deliver in terms of interaction and value will perpetually escalate.”

This is not to say that each traditional provider immediately needs to launch a low-cost robo platform. “But more to emphasize that digital engagement will become part of the core expectation of investors up and down the wealth continuum,” said Smith.

The question, he said, is not whether traditional firms will offer these types of platforms, but which will best connect their advisers to clients in ways that highlight the value of advisory services beyond commodified aspects of portfolio management.

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According to Cerulli Associates’ research, Smith said there will be increasing pressure on traditional advice providers to broaden their advice services to maximize their value to clients. “Advisers will no longer be able to tout their services as ‘wealth managers’ while focusing almost exclusively on the implementation and rebalancing of an accumulation portfolio,” he said.

Smith also noted that over the last year, there has been a pronounced change in the “robo advice” landscape. “Prior to 2016 there was widespread concern across the industry that robo advisers would fundamentally disrupt the traditional financial advice market,” he said. “Several start-up providers were gathering assets at meteoric rates and there were widespread assumptions that numerous other firms would jump into the market and enjoy similar success.”

More recently, however, Smith said it has become clear that the “robo revolution” will be most impactful as a catalyst to moving traditional advice providers into the digital age rather than replacing them outright.

“Instead of competing with them, many of the start-up robo advisors are increasingly serving as the plumbing connecting traditional advisory firms to their clients,” said Smith. “Many robo firms have engineered outstanding technology platforms, but have neither the brand recognition nor the network of field advisors to achieve the distribution scale they need.”

By pairing advisers skilled in building out their natural markets and gathering assets, with platforms that allow them to optimize their efficiency, Smith said provider firms will be better able to maximize their marketshare in the long term.

For his part, Winterberg suggested that financial advisers must examine what aspects of their practice is right for robo and which isn’t. “Financial advice providers must challenge themselves, and their business models, today to identify what aspects of their work are candidates for automation and algorithms, and what aspects cannot be automated,” he said. “The opportunity for advice providers’ success in the future lies in augmenting the aspects of their business that are truly unique and difficult to scale, such as empathy for clients, evaluating and discussing tradeoffs, and offering a compromise to the actions clients can take.”

Another expert also suggested that there is high degree of uncertainty right now over robo and human advisers. “Legislative and regulatory changes over the next few years are likely to have an impact on the ultimate outcome,” said Joel Bruckenstein, a certified financial planner and publisher of Technology Tools for Today. “In the near term, I think it’s unlikely that digital will totally displace good financial advisers, but longer term, it is difficult to totally rule out.”

Perhaps the more interesting point, Bruckenstein said is that the CFP Board is interested enough in technology and digital advice to take a leadership role, while they continue to virtually ignore technology in the CFP educational program.

“Furthermore, to this day, the CFP Board absolutely refuses to grant any CE credit at to advisers for improving their competency with these 21st century tools of the trade,” he said. “The CFP Board did put together a very impressive group of experts to explore scenarios, most of who I know personally and respect, but until the CFP Board gets its own house in order, it is difficult to take them seriously as a technology leader.”

“We feel that advisers have been using technology to improve front- and back-office functions for decades,” said Joe Maugeri, managing director of corporate relations at CFP Board. “The more important question, though, is in regards to how advisers will change their practice to focus on things technology can’t do, such as working with clients to define goals, explaining and working through behavioral finance issues and developing holistic financial plans ready to help investors in 2017 and beyond.

The CFP Board believes, he said, that technology should be the tool that helps advisers do what is most meaningful: deepen client relationships and enhance the level of financial advice consumers receive. “Ultimately, technology will continue to evolve and create scale and capacity that will enable advisers to do their jobs better and empower stronger connections with the clients they serve,” he said.

Will FPA’s deal with Betterment lead to measurable change?

Winterberg applauded the FPA for establishing a partnership with Betterment for Advisors, but he wasn’t convinced that it will lead to any measurable change in the adoption of automated investment solutions by the association’s membership.

“Access to thought leadership content and collaboration with industry influencers is just a tweet or an email away in today’s world, and the fastest-growing advisers are already connecting with solution providers to implement tools for digital advice,” he said. “The partnership will allow Betterment for Advisors to deliver content to a larger audience, but I’m not certain if that will result in engagement and attention from the FPA membership.”

Bruckenstein wasn’t convinced that the FPA’s deal with Betterment was a game changer either. “The FPA does have over 20,000 members, but they are not a homogenous group, and they don’t always follow the FPA blindly,” he said. “I’ve yet to encounter an adviser who chooses a piece of software based solely upon a sponsorship that a firm has with FPA.”

To be sure, the sponsorship will surely bring visibility to Betterment among some advisers, Bruckenstein said. “But in the end, advisers choose providers based upon the specific needs of their firm,” he said. “I think the challenge for the FPA will be to retain the loyalty and support of other digital providers who compete with Betterment.”

For her part, Lauren Schadle, the executive director and CEO of FPA, said the collaboration is not about whether FPA members decide to adopt the Betterment for Advisors platform for their respective businesses. “Rather, it provides our members with a greater understanding of the technology involved so they can make a more informed decision by providing Betterment with an opportunity to connect more deeply with the FPA advisor community,” she said.

The fact is that financial planning is a very high touch profession that requires the skill of a CFP professional, said Schadle. “The use of technologies like those offered by Betterment for Advisors can augment financial planning offerings for those members and firms that choose to do so,” she said. “Our focus now is on working with the Betterment team to see how we can integrate their experts and content with the expertise of FPA’s adviser community.”

Bottom line

Welsh said the efforts by the CFP Board and FPA are just baby steps. “The real change is coming soon as technology becomes a bigger piece of financial services and organizations like the FPA and CFP Board will need to up their game to continue leading the way,” he said.

Robert Powell is editor of Retirement Weekly, published by MarketWatch. Get a 30-day free trial to Retirement Weekly. Follow Bob on Twitter @RJPIII. Got questions about retirement? Get answers. Send Bob an email here.