Being open to change and having a continuous improvement mindset are great things, but stubbornness can have value too.
To work in financial advice, is to work in a world of constant change, and whilst for a long time the stereotypical adviser might have been a white male boomer sitting behind a desk doing the same thing they always have, it’s not true today (if it ever was).
If you’re in financial advice in 2021 and doing well (or at least well enough to be interested in the stuff I write about) at least some of the following probably applies to you:
- You are fairly good at adapting to change;
- You are in a business resourced to adapt to change; and/or
- You like finding better ways of doing things, given that’s much of what financial advice is about.
If the above didn’t apply, you wouldn’t have survived the last ten years in advice. Assuming that’s not you, these factors can lead to a couple of really positive mindsets, in particular:
- A willingness to change;
- A desire to innovate; and
- A willingness to continuously improve.
In this article, we’re covering the double-edged sword that comes from those mindsets. Specifically:
- The types of change where an open mind works and where it might not;
- The possible downsides when anything is possible; and
- Structuring your process and mindset for significant change.
If you would prefer to watch a video version of this article, you can find it here.
Where an open mind works and where it might not
We’re big on continuous improvement, huge even. This involves constant iterations and changes that can be rolled out regularly.
This is great for situations where:
- The continuous changes support clear organisational goals;
- The changes are easy to implement;
- There aren’t complex trade-offs.
Examples of this at the simpler end could be implementing templates, building in-house calculators to accelerate manual calculations, or outsourcing simple functions. At the more complex end, this could include attaining an offshore resource or changing a non-critical or narrow scope technology service (such as Survey Monkey to TypeForm, but not MicroSoft to Apple).
In these examples, an open mind and continuous improvement (aka Kaizen) culture is outstanding.
It might not
Alternatively, some things can be complicated. These include potential changes which:
- Incur significant costs that ought to have been budgeted for;
- Have an impact that can have significant downside risk; or
- Require significant change management
The impact on change management is no small issue. Every individual only has so much capability to change at any one time while still doing their job effectively, and the team/unit can only move as quickly as its slowest member in this regard. As such, considering your ‘change management’ budget is almost as important for driving change as your financial budget.
The two most common examples of this which I see are:
- Technology solutions, where it would constitute a major change; and
- Licensees or licensee services.
These aren’t the only examples, but given they are areas of constant change they are particularly sensitive. One item that could be considered to be similar is changing location, but given the contractual nature (long leases that are painful to break with significant client/staff costs), it doesn’t have the same challenges in practice.
When anything is possible…
Where being open to change might not work, stubbornness can add some significant value, at least up to a point.
When you get a marketing email for a solution, when a BDM contacts you, when a team member raises something that they came across and thought was cool, or when something you saw in a webinar seemed pretty neat, the change process is triggered by external factors. It’s in these externally driven situations where being continuously open to change creates problems.
Time spent evaluating new solutions is a cost, and whilst it might seem polite to simply entertain a demo or have a meeting, these create a cumulative time sink.
To help offset this, delegating to a junior might seem appropriate, but without clear guidance or parameters, it doesn’t help anyone and just wastes everyone’s time.
Figaro here, Figaro there, Figaro up, Figaro down, swifter and swifter I’m like a spark: I’m the handyman of the city, but I also struggle with complex issues and change management.
Figaro, in The Barber of Seville, slightly adapted.
Even in those situations where it’s your job to be aware of what the whole market is doing at any given time, it’s not practical to do so ongoingly. Especially in contexts where solutions change over years or even months, which is all too frequent trying to innovate within financial advice.
If you’re always thinking about change seriously, then you and your team can’t (or won’t) invest in improvements. The cost of this is really hard to understate, so here are a few examples:
- You’ve accepted an offer for a software demo and have (rightly) included some of the team who’ll be most affected by any change. From the time that was booked, until the time that you tell the team you won’t be considering it further, you’ve signalled that any small investment they might’ve made in using existing tools shouldn’t be done. Even then, you’ve discouraged investment as you’ve indicated a willingness to change.
- Your licensee has told you they have a new service available which would be of value, but you’re meeting with an alternative for a coffee next week. Even if that option is a long shot, it’s hard to make the investment to adopt this benefit when you even have a toe out the door mentally.
- You’re in the process of buying another practice, whereby ‘everything will change’ without really considering exactly what will change and what won’t. By failing to do so, business improvement stalls, as opportunities to invest in areas that won’t change are missed.
Poor decision making
This approach, being an externally driven approach rather than an internally driven approach, has three factors that negatively influence the quality of decisions being made. These are:
Best sales team wins
When you’re being driven by external factors, you’re biased towards the product with the best sales team and marketing. Whilst this is always the case to a degree, if it was an internally driven process where you are seeking a solution that meets your needs on your timing, you’re more likely to find the best option and not just the best sales team.
comparing one options vs all options
When we’re being pitched to or we’re following up on an individual option we’d heard about, we’re generally comparing our current option to the option being presented. What we should be doing is comparing our current solution against all possible solutions.
If the timing isn’t right to change, we shouldn’t even be considering it. It’s a bit silly to be entertaining alternative options, where we wouldn’t even want to make the change yet.
This is particularly true of both the licensee and technology spaces, where change is so frequent and constant.
Structurung your process and mindset for significant change
The solution for this is relatively simple, but it does require structure and a small degree of stubbornness.
Have a process
I recommend having a process for major change items that:
- Allows sufficient investment, time, and attention to inform the best possible decisions. This may include engaging a consultant like us to help inform decision making at the time, purchasing research from a group such as Investment Trends, or a range of other options too long to list here.
- Is scheduled and infrequent to allow the change process to justify the proper investment, and solutions to have time to make a return on that investment.
- Will actually happen, or if it doesn’t happen, is rescheduled and communicated to team members when it happens in the interests of engagement.
Stick to it
This means whenever there is a request or a suggestion for change, either externally or internally, you advise what your process is for making such decisions and what timing is.
This can be as simple as telling your team member or a BDM that you aren’t considering the tool right now, but you’ve added it to a shortlist for consideration at that point and will come back if it merits further investigation.
An alternative option could be a very short triage step which can work if you have access to an expert who can very quickly qualify whether a proposal is in a yes/no/maybe basket. This can be good for setting expectations quickly.
There are two personal favourite timings for when to do this:
- January, when things are quiet and decision makers are more likely to have time to consider critical decisions properly. This can be the best option when you’re leaning towards maintaining status-quo but are still open to change.
- October/November, which is tougher but can mean you are set to implement major changes during the January quiet period.
If you’re looking at major change in your business and would like some expert help, or would like to learn more about how we might be able to help you, please ‘Book a virtual coffee’ using the button at the bottom of this page or drop us a message at our Contact page.
If you have any questions or would like to share what has worked for you in the past, please take advantage of the comments below.