It's no longer a surprise to anyone in the investment industry that disruption and revolutionary change is upon us — and no one is immune. Although some will be impacted more than others, the game has changed already.
Certainly, it's easier to fight change than accept it, but chances are the fight will come too late given the advent and rise of "fintech" and "robo-advisors," or the myriad of regulatory initiatives happening all around us. Whether we agree or disagree with the various proposals before the industry, it will soon be moot. We can argue to our hearts' content about how fees should be administered and disclosed; who can use what title; and the impact of various proposals on the industry and consumers. However, none of that will change the fact change is here and the financial services world of the past is already gone.
As such, those who hang on to what "was," putting their energy into resisting rather than adapting, will suffer most; this goes for all of us: financial advisors, financial planners, investment industry firms, self-regulatory organizations and industry and professional organizations, such as the Financial Planning Standards Council. The writing is on the wall, and we all need to evolve to this new world order, and quickly, if we are to survive and thrive tomorrow.
In hindsight, BlackBerry Ltd. should have seen the imminent demise of its Blackberry OS with the advent of iOS and Android and changed course. Instead, the company held on to the old world too long; likewise the taxi industry could have reinvented itself, embraced technology, transparency and ride-sharing such as Uber, but are instead fighting a losing battle toward their ultimate demise.
In the provision of financial advice, revolution is now upon us; the choices are to focus on fighting the inevitable or to spend that same energy figuring out how to adapt, embrace technology and build a truly distinguishing profession that delivers a value proposition of professional advice that only a qualified, competent and ethical true professional can deliver.
Read: The Tech Revolution
It's all about mindset. In fact, the whole topic of mindset has exploded the past few years, much of which can be attributed to Stanford University psychologist Carol Dweck, whose decades of research on achievement and success has offered some ground-breaking insight on the power of mindset. Paraphrasing Malcolm Gladwell, we know from study after study that people with a fixed mindset do not admit or correct course when necessary — and any financial professional who cannot self-correct in today's world won't survive.
In the context of revolutionary change, advisors with a fixed mindset believe the system is made up of fixed, unchanging traits. They spend their time defending their talents rather than developing them. They believe their offering and value proposition is static and can't change. And they are wrong.
In a growth mindset, advisors know that their talents and the value they have added in the past are just a starting point for their skills, abilities and value proposition. They believe that skills are dynamic and can be developed — and that the value proposition they bring to the table can be reinvented through dedication and hard work. This mindset offers them a love of learning and a resilience that is an essential element of success during disruptive change.
It's no secret that machines are replacing the "hard skills" and knowledge that were previously held up as the value proposition of advice. In addition, tightening regulation is making it harder to survive without a compelling value proposition that clients will want to pay for.
If there was ever a time to embrace a growth mindset in the financial services sector, it's now. What were once considered "soft skills" — empathy, communications, relationship building, sage counselling and an understanding of self- and client-behaviours — will be the "hard skills" of every profession tomorrow. My money is on the advisors who want to grow, adapt and thrive.
Read: Secrets of "soft" skills