by Tony Vidler
“Innovate or die” said Peter Drucker.
Have financial planners been innovating in recent years? If not, does it mean they are slowly slipping towards their terminal breath?
Of course they aren’t – and there are signs of innovation in some areas within the industry. Furthermore, it must be acknowledged that during the last few years the emphasis for most practitioners has been upon creating businesses models and practices which meet the approval of external parties such as governments, regulators, dealer groups, and so on.
Regardless of the underlying reasons there is clearly a need for innovation in the financial planning business given the overwhelming sense of sameness that is beginning to evolve and the general lack of understanding about the value that good planning can create for customers.
A report issued by NZ Trade & Enterprise in 2009 for the Manufacturing sector contained an excellent, research-based, suggestion about creating innovation with its “Value Creation Model”.
4 key drivers for innovation and success were identified as strategy, creativity, connectivity and operations.. The same four drivers would appear to be central to creating innovation and success in business development of financial planning practices.
The good news for us is that we have spent several years now focusing upon the operational aspects of businesses – albeit in many cases without having any clearly formulated strategy (as the operational focus has been thrust upon industry at large).
Aligning those operational elements (how we do the stuff we have to do) with customer needs and connecting with their aspirations is a critical step in developing a business renowned for creating value though. So there is some benefit in having exhaustively reviewed, refined and enhanced the operational elements of the business.
That is true of course only if practices understand how that operational excellence can lead to a business that is renowned for creating value and being innovative in meeting customer needs.
Excellence in execution (operations) that is aligned with customer needs and wants creates connection. When that connectivity and alignment is then shared further afield (marketing and business development functions) it creates new opportunities that fulfil the purpose of all stakeholders. This focus on excellence, customer experience and alignment, and the ability to leverage those successful engagements create greater strategic clarity and focus.
These have proven to be the common drivers of excellence and high value creation in manufacturing, and it would appear to be a model that has merit for financial planning practices too.