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Transformation in the industry – why is it such a huge challenge?

01 October 2013 Grant Hopkins, Pfirestorm

It has been 10 years since the introduction of the Financial Advisors and Intermediary Services Act (FAIS) in South Africa. The dust has still not settled and regulated financial advisers continue to ply their trade in a stormy, ever-changing environment. If this is the case, the question is: why are financial advisors struggling to transform themselves within an industry that will so clearly force change upon its participants anyway?

One supposes that the reasons for this being such a huge challenge are vast and will vary depending on who you talk to. Notwithstanding all the noise around this, the truth is far simpler.

The beauty of routine and rejecting change

Routines are a benefit, and offer all of us tremendous value. Commitment, comfort and discipline seem to flow seamlessly and by its very nature become automated and systemized. Routines are wonderful because they are the barriers that keep out unwanted or unsolicited activity. They keep us honest and clinical and soothe us, especially when the pressure is on. Routines make sure that we cover all of our bases, and that we satisfy the regulators, customers and providers in as few and simple routine steps as possible. Comfort zones are under-rated.

The impact of change

Change on the other hand is like an alien invader, poking around our routines, trying to find a way in. Change has a single and clear purpose: to change our routines, which is the very essence and foundation of our business that has taken years to establish, entrench and appreciate.

Change is like a virus and once you adopt it, it is endless. It means a change in routines, and why on earth should anyone in their right mind want to make life harder than it already is? Change is uncomfortable.

King Whitney Jr once said, "Change has a considerable psychological impact on the human mind. To the fearful it is threatening, because it means that things may get worse.”

Change is coming and will continue to do so for some time to come. Prepare now to defend routines, and make sure that this unwanted change evolution is stopped in its tracks. Who needs the aggravation?

As Melchor Lim says, "You can only change the world if you are crazy or exceptionally ambitious enough to believe you can”.

Technology has driven a lot of change

We now know that technology is the biggest driver of change. We are in the midst of transformation at the workplace and just as big, and perhaps even more far reaching, than the last major change: the industrial revolution of the 19th century.

The internet appears to be having the biggest impact. Part of this is the move from mass marketing to mass customisation of products and services. We are now truly in a personalised, service-based, information centered society.

The world-wide-web has accelerated the creation of new forms of contact between organisations and their client communications, document management, and real time Customer Relationship Management. Every organisation is desperate to get a dialogue going, and collaborative internet based technologies provides solutions and plays a huge role in making this happen. Organisations are expressing their personality and are engaging with their customers in novel ways.

Proactive in the market

Customers and organisations need real time activity and access to management information that will allow them to be proactive in the market. Time is the new currency and technology, especially the collaborative kind, is becoming the new minimum standard to facilitate change economically, comfortably and securely.

Remember Encyclopedia Britannica? Imagine the challenge it faced when Microsoft offered a free full encyclopedia to any buyer of their products. How do you compete or survive in an environment like this?
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