When we wrote about digital disruption becoming the clients’ best friend, we didn’t just mean digital media, or digital tools, like the ones we build.
We meant the type of digital disruption that makes it possible for kids on home PCs to create things that big businesses can’t.
But simply accepting that digital disruption creates one hundred times the competitive threat isn’t enough. Businesses have got to start finding ways to fight back.
Interestingly, the author of Digital Disruption, James McQuivey doesn’t advocate locking the entire workforce away in an innovation chamber and hoping that a magic panacea emerges.
Whilst it’s easy to think that innovation is the core of the problem – that big corporations stifle good ideas, or prevent them from being implemented quickly, McQuivey points to a different priority:
“What matters most is how much you can multiply the power of each individual employee using digital tools and by exploiting digital platforms. The employees that deliver the most value will be those who make contributions that can be multiplied digitally.
So how do you go about multiplying the power of your workforce?
Identifying the power within your employees
Here are some simple questions to help get the ball rolling:
What do your employees know about selling/designing/making your products and services that few outsiders know?
Which of those things would be really hard to teach other (cheaper / less busy / less qualified) people to do?
Which of these have the biggest impact on the bottom line?
Maximizing employee power
Now you need to try as hard as you can to remove every distraction that diverts your employees’ focus away from these big hitters…
- Which BAU activities could you stop doing?
- Which tasks could be done by new / cheaper / less experiences colleagues?
- Could partnering with another business bring economies of scale that benefit you both?
- Are there tasks you could outsource effectively?
To fight digital disruption at its own game, you have to get better at using the digital tools at your disposal.
If you could outsource your fund factsheet production process and halve the time it takes then do it – that’s what the up and coming competitors are going to be doing…
If you can partner with a digital agency to build self-serve tools that reduce customer requests and increase client satisfaction, do it – the new guys will…
Multiplying employee power
And then, once you’ve got your employees really producing their best work – their greatest fund marketing campaigns or some really cutting edge commentary or analysis, you need to multiply the impact.
- Use digital tools to spread your messages far and wide.
- Use digital platforms to give you clients secure portals in which to explore their investment performance.
- Use interactive tools to allow clients to create hundreds of customized views that multiplies the amount of information they can access
Do the same rules apply to fund management?
Strength is no longer the same as size. It used to be the case that bigger = better, but large corporations are no longer more secure or more profitable than smaller ones – just think Kodak or Blockbuster.
In many sectors, we’ve already seen countless examples of small guys flipping places with the big boys.
But what about fund management? Yes, there’s a whole lot more competition out there? Sure, some asset managers are using more innovative strategies than others? But where is the game changing, completely leftfield threat?
The answer, I think, is that it is yet to come.
A few things make financial services a little bit different from many (but by no means all) other sectors:
Regulation – who really wants to enter a world of never ending compliance meetings when there is other lower (and more interesting?) hanging fruit?
Product complexity – Financial products are hard. It’s true. Not everyone can understand them, not everyone can explain them.
The people who come up with the next big thing in mutual fund marketing will be:
- The ones who ‘get’ regulation enough to look beyond it
- The ones who can cut through product complexity to focus on what clients want
Delivering what clients really need to make both their investments and lives function more efficiently is where the opportunity lies.
So where are these people? How do you find them?
The fact is they are very likely sat down the corridor from you right now.
The people who know your products inside out, who know and understand client needs, who know what’s been done and what works and what doesn’t are probably the people you’re already paying, it’s just that rather than paying them to innovate and design, or paying them to communicate and serve clients, you’re probably paying them to sit in meetings, follow procedures and carry out mundane BAU tasks.
But BAU is important…
Of course it is. BAU is crucial, but BAU – by its very nature – can also often be taught, or automated, or outsource – often to deliver better results than an internal team achieved.
Why? Because BAU depends on processes, on technology and on skills like design, production or data management that lay outside the comfort zone of your marketing teams or client servicing departments.
Unleash the power within
So, next time you start worrying about the threat from new entrants, start thinking about how to unleash the power within your organization. Multiplying the power of your workforce by finding the right partners to carry out BAU might just make you the next innovator rather than those kids tapping away on their home computers.