Last week I was in Melbourne presenting at an industry conference. During a break I was speaking with the 2nd-generation owner of a well-established business (a financial planning business), I’ll call him Mark.
Mark explained the business had been founded by his father a few decades ago and they were now in a relatively healthy financial position. However his father was close to retiring, times are changing, and Mark had come into the business to move it forward.
Things looked OK. His father had built a sizeable book of clients. But the financial services industry is evolving quite rapidly. Old revenue streams won’t be future revenue streams. And Mark was looking for options.
And so he should.
Experiment at the leading edge
One of the factors I mentioned to Mark was that in these times of change smart businesses are experimenting at the leading edge. They don’t gamble on a make-or-break experiment, but they do push themselves to adapt and try new things. They have a desire to evolve.
Unfortunately Mark’s firm, like many in the financial services sector, are comfortable, set in their habits, and hesitate to change what they are doing.
A simple example of this lack of “edginess” was that Mark had toyed with using brief videos to explain some of the more complex aspects of financial services. This is a great idea. These videos would be a tool to differentiate his firm’s services, help give them more of an online presence and, importantly, help educate clients so they are empowered to make smarter wealth management decisions.
Mark had recorded himself a few times but didn’t like the outcome. He thought he looked silly. And that’s where the video effort stopped.
Look over the horizon to the future
I explained to Mark that in my experience across numerous industries the most successful firms were the ones who had looked over the horizon and started developing new techniques, client service models, and revenue streams before the majority of the other players in the market realised they were needed.
And by the time clients become aware of new options – for example the ability to access information or services online rather than “having to” see an advisor in person – it is too late for providers to start developing their business model and service activities. Clients are already seeking that level of service and are ahead of these late-moving providers. Clients want it now.
Within the financial services sector there are certain trends that everyone in the industry knows about. Technology is now available (with more in development) that will help financial services providers deliver a more streamlined, educational and cost-efficient client experience.
From the client side, other technology, such as apps and online services, are enabling clients to access services from financial services providers outside their local area. No longer do you have to rely on meeting your local financial planner in person.
Mark’s situation, and the evolutionary trends within the financial services sector, are certainly not unique. Many industries face this sort of accelerated development (or disruption) pushed along by technology advancements on a global basis.
My comment to Mark was that he should be looking at the early indicators he can see now of what clients will be expecting in the future. In essence, to look over the horizon. There is information available to him now he can rely on. He knows things are moving in a particular direction. It isn’t guesswork.
Mark is on the right path thinking about the future. But he needs to do more to actually adapt. He must free his thinking, and improve his firms level of proactivity, to reposition the business for success in the new environment.
Don’t let old expectations and inhibitions hold you back. Mark thought he looked silly on video. However, I made the observation that I bet he didn’t think he looked silly when he was saying the same thing to an actual client in a live situation. He is an experienced professional – of course he didn’t look silly.
Don’t let your conservative nature or current comfort zone prevent you from looking ahead and moving forward.
If you would like to arrange a complimentary confidential discussion to assess your future options request a meeting.