The dangers of waiting to implement tech
The dangers of waiting to implement tech
The rate of innovation in the technology sector means the promise of something better is ever present, but the Adviser Network's Duncan McPherson warns that waiting for the next best thing can sometimes be as bad as inaction.
An ancient Chinese proverb says 'the best time to plant a tree was 20 years ago, the next best time is now', and introducing technology solutions to your customers is a lot like planting a tree.
If you haven't already done it, now is the next best time. But for many businesses, 'the problem of next' inhibits them from acting.
The problem of next is a common human condition: in simple terms, it's what stops people acting because they believe if they wait, the technology will be better tomorrow, the next day and so on.
Truth be told, by waiting, businesses are failing to respect their customers' right to choose and to adopt new opportunities and, as a result, fail to participate in exponential growth.
What we've learnt from experience is that you gain more from being a participant than an observer. For example, your business would not have realised the gains from advancing technology if you hadn't adopted electronic processes.
Equally, those efficiencies didn't happen overnight. It took your business time to implement, change behaviours and build into the cultural fabric of the firm.
By delaying, businesses are saying it's OK to be laggard because their shareholders and clients are happy to wait while they pay too much!
Digital advice is no different to any other innovation; it's going to take time to find its place in the market, but when it does, its growth will be exponential.
Such growth is enabled through advancing technologies and we'll see increases occur in multiples, rather than on a linear basis.
A great example of this would be that if you take 30 linear steps, you'll end up across the room, but if you take 30 exponential steps, you'll circumnavigate the globe several times.
The trick with exponential growth is that it's very deceptive in its formative stages. Doubling one to two, and two to four, doesn't sound like a lot, but don't be deceived.
It's once you get to the ninth or tenth steps that you'll start seeing the power of exponential growth. This is where 256 becomes 512 and then 1,024. It moves deceptively slowly to very rapidly changing the landscape and your business along with it.
Early participation is essential if you want your business to be recognised as progressive. To get to 1,024 you need to start at 1, which means the next best time to start is today.
Exponential growth doesn't just happen because it's a good idea. There are three things that need to happen for digital advice to realise its potential, both for businesses and their customers. The three things are:
- A maturing market. Today, there are only a few operating digital advice platforms. To become accepted, the market needs to form with new entrants. We're starting to see this with the proliferation of fintech firms.
- Market fit. All participants in the advice market need to find their place and work relentlessly to continually improve the outcomes for the members. This means accepting innovation and welcoming competitors.
- Cultural alignment. Like all other parts of the service profit chain, it needs to become part of what your firm does. It's not an experiment or hobby.
The importance of culture can't be overemphasised and digital advice will not end up in the waste land of other innovations like the first electric car.
Today, consumers are much smarter and don't stand by as bad things happen to good ideas that they care about.
The internet has empowered consumers to make decisions and if their demands are not met, they'll find an alternative and punish the gatekeeper.
Digital advice won't happen by itself but the overwhelming demand from the consumer and the advancement of technology means it will happen.
Businesses need to decide whether they are going to be a participant or someone who stands by because next year it'll be even better.
The opportunity is to act now and participate in the deceptive phase of exponential growth. The decision is whether your business wants to be in a customer-led market position or one that perpetually waits for next.
Duncan McPherson is the chief executive of Adviser Network
Subscribe to our Newsletter
We Translate Complicated Financial Jargon Into Easy-To-Understand Information For Australians