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Advisory Boards in the Financial Sector


Part 8: Is ChatGPT a useful alternative to Advisory Boards?


In spite of the name “Advisory Board”, it doesn’t exist just to “hand out” advice. The dynamics of a good Advisory Board (AB) are more complex and nuanced, which helps explain where ChatGPT (and others) fall short. This article continues the series on Advisory Boards for the Financial Sector, which can be found [here].


Dear ChatGPT:

Please write me a 5-page strategic plan for growing an asset management company by at least 10% a year, where the target is High Net Worth individuals.


Generative AI (whether ChatGPT, Bard, Claude, or any other implementation) will have no problems coming up with a response to the above question. In fact, it could just as easily produce 500-pages of middle-of-the-road and formulaic “strategic” thinking, if you ask.


The concern is, how close is it to the advice that you actually need? For example:


• Is it suitable for your specific asset management company, given your existing infrastructure?

• It is consistent with your brand that you’ve been building for years?

• Does it reflect the realities of your specific target market (in terms of defining what “HNW” is, your target geographies, etc.)?

• Does it reflect that you’ve tried things in the past that haven’t worked, which should not be tried again for fear of confusing your existing clients?



Let’s look again at some key features of good Advisory Boards, and see how the use of Generative AI compares:


• They are run by an independent Chair in order to bring in new perspectives and steer, without being tied to habitual thinking and vested interests of company employees. Indeed, if those ‘vested’ employees are the ones feeding background to, and asking questions of ChatGPT, can the responses really be independent?


• Members of a good AB will ask questions like, “But why is that important to the company?” or “Aren’t we actually trying to solve a different problem?” or “Do you really think that will achieve the effect you want?” ChatGPT, on the other hand, will simply answer the questions it is being asked, even if they are the wrong questions, or leading questions.


• The members of the AB get to know the company and the management team better over time. They start to understand the company’s Unique Selling Proposition, the motivations for past decisions, the personal as well as corporate objectives … and all of this ensures that output from the AB is directly relevant to that company. There is a limit to how much of that can be communicated to ChatGPT, and therefore a limit on the usefulness of what comes out.


• Of course, if you want to re-write your company’s Articles of Association in the style of Dr Seuss children’s rhymes, then ChatGPT is going to be a much better option than your Advisory Board. But hopefully you’re trying to solve bigger problems than that!


We agree that, some way down the line, companies might be able to rely on Generative AI to truly solve a business problem. But that time has not yet arrived.



ACTION: Remember that on Wed 28th June at 0830-0930, we will be hosting a FREE webinar on the practical steps of setting up an Advisory Board, including a discussion about “AI as an Advisor?” We’d love you to join us, please find details [here].



Written by Jonathan Watkin & Greg Solomon

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