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Change is a catalyst that can drive innovation and help position businesses in all industries for sustained success. The adoption of wealthtech illustrates the transformative power of embracing change.
When managed appropriately, it can create significant advantages for financial professionals and their clients. However, bypassing the change management process can derail even the most sophisticated software update or product enhancement launch.
This year’s CrowdStrike debacle, which inadvertently brought businesses across the globe to a screeching halt, is one consequential example of a lapse in proper change management. What should have been a routine maintenance exercise caused immediate chaos and worldwide panic. From grounded airplanes to halted banking operations, few were left entirely unscathed by this high-stakes error.
Another notable instance that played out over a more gradual timeframe is Kodak’s failure to evolve amid the digital disruption that introduced smartphones and new ways of photo sharing. This prompted the decline and bankruptcy of a once dominant film and camera industry giant. Fortunately, the company has since regained its footing and profitability.
Ineffective change management can have serious repercussions. For instance, a minor error – whether driven by haste to launch or a tendency towards complacency – could impact the efficacy of a wealthtech solution designed to support a client’s retirement planning goals. To increase the likelihood of successful short-term and long-term results, it’s advisable for companies to proactively establish and follow a solid change management process.
In its simplest form, change management is a systematic method for guiding an organization through transition.
When done right, change management can improve everything from employee and customer sentiment to a business's bottom line. Conversely, improper change management can hamper even the most promising endeavor.
Given the fiscal responsibility and focus on accountability in an industry like wealthtech, it is important to factor in both human and process change management tactics before introducing any new initiative. Although adding an extra step ahead of a launch might seem cumbersome, failure to do so could lead to regret and additional work in the long run.
One way to streamline the change management framework is to automate it using artificial intelligence (AI). But it’s important to treat AI as a tool and not a crutch. Skilled human oversight is the key to a satisfactory result.
Evolution, transformation and innovation are crucial for an organization’s viability.
Implementing proper change management during strategic pivots supports the collective efforts to achieve a business’s goals. Deploying a well-thought-out change management plan ahead of any new product or process launch aligns with modern best practices.
AI applications, coupled with appropriately rigorous human oversight, can help streamline change management protocols, removing barriers to expedient fulfillment.
As the world continues to evolve, those who successfully infuse appropriate change management frameworks into their plans will better position themselves for long-term success.
Scott Lamont is managing director at F2 Strategy, a wealthtech management consulting company serving complex wealth advisory firms
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Advisor Perspectives welcomes guest contributions. The views presented here do not necessarily represent those of Advisor Perspectives.