Sometimes the most important business improvement initiatives are at the edge of your comfort zone, and you ignore them at your peril.
It’s important to look for signs that it’s time to change.
A little while ago 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.
Smart businesses 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 risky 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.
You must 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, and start demanding it, it is often too late for providers to start developing their business model and service procedures. Clients are already seeking that level of service and are ahead of these late-moving providers.
An example:
A great real-life example of how trends on the horizon can come rushing at you is the ability for clients to access information or services online rather than having to see an advisor in person – a trend which had been slowly developing and then suddenly accelerated during the coronavirus pandemic of 2020.
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.
Find the early indicators for your sector
Mark’s situation, and the evolutionary trends within financial services, are certainly not unique. Many industries face this sort of accelerated development (or disruption) pushed along by technology advancements on a global basis, local regulatory changes, or customer demand.
A simple way to assess future business growth options is to refer to the Ansoff Matrix (also known as the Product/Market Expansion Grid) which defines four basic strategic options, as shown below.
Whilst being useful, this framework is somewhat simplified and a business may need a hybrid strategy depending on the nature and complexity of the products or services they offer. But overall it is often a very useful starting point to clarify whether you need to address new markets, or new product offerings, or maybe a combination of both.
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. Making these decisions needn’t be guesswork.
Take action to adapt
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, and possibly work on the business culture to reposition the firm 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.
Book a free confidential meeting
If you would like to arrange a complimentary confidential discussion to assess your future options request a meeting. We can meet over Zoom or in person where available.
