What business are we really in?

Advisor says if anybody thinks they are in money management, they might be at risk over the coming years

What business are we really in?
Grant White

Have you ever stopped to ask yourself, “what do I do for my clients?” or “what business am I in?” Recently, I came across a video about a book written about the experience that Apple creates for its customers. The video suggested that Apple is not in the business of selling devices and services but rather it is in the business of enriching people’s lives.

The author goes on to describe that the true genius behind Apple is not that they build these amazing devices and services, but the realization of the true business they are in, which helps them to transcend beyond just great devices. This is where their true success was achieved. In understanding that, Apple has been able to create a culture and brand that is lived and experienced at every level of their organization and certainly with their customers. So, as wealth managers, what business are we really in? I would caution that if you think you are in the money management business, you might be at risk in the next few years.

I remember being in business school and taking case study after case study of failed businesses. History is littered with the names of companies who failed to understand the business they were truly in and in turn failed to innovate as consumer demands changed, including Kodak, Blockbuster, Tower Records, Borders, HMV and so many more. Looking at Blockbuster, this company failed to recognize that they were not in the video rental business and instead were in the in-home entertainment business, and maybe in the family connection business. Of course, as the story goes, Netflix came a long and ate its lunch.

In wealth management I believe that we are in the “opportunity industry”. No matter what your focused specialty is, when you boil it all down, we are in the business of creating opportunities for our clients so that they can achieve their goals and live the lives they choose. Frankly, it does not matter what those goals are. We all have clients who are singularly focused on retiring and being able to live the comfortable retirement lifestyle they dream of.

Many of our clients are now climbing Maslow’s pyramid and are in a position where their goals have shifted to making an impact in their community. We likely all have clients whose goals are less granular in that they simply want to grow their money. I would argue that even with the latter, we are still in the business of creating their opportunity to achieve that goal. No matter what the goal is, our job is to create the opportunities for our clients to be successful.

The real benefit of understanding the true business that we are in is that once you acknowledge it, you can identify new and innovative ways to deliver even more opportunities for your clients. In a recent example, one of my clients has for many years been trying to restructure their business to make it more efficient. Their main goal is that they want to create a replicable service model that can be adopted easily by other producers in their industry. The ultimate goal is that my client wants to raise the bar for client service and experience, and ultimately raise their profession. Generally speaking, my client was looking for something that is outside the scope of traditional wealth management services but not when you consider my job as an opportunity manufacturer. I introduced my client to the software developer who had been building my CRM system and he is now building them a technology platform and delivering an opportunity to expand their business culture and philosophy well beyond what they could have imagined.

We are standing at a very interesting crossroads in wealth management where traditional services and client offerings have not changed too dramatically in some time. Sure, products and certain strategies have adjusted with the times but really the service itself has been a bit stagnant. That is about to change as the expectations for advice-based experiences are being molded by experience companies including Apple. In order to survive and thrive we will need to understand exactly what type of business we are really in and only then can we identify the opportunities for ourselves.

Grant White is a Portfolio Manager/Investment Advisor at Endeavour Wealth Management with Industrial Alliance Securities Inc, an award-winning office as recognized by the Carson Group. Together with his partners he provides comprehensive wealth management planning for business owners, professionals and individual families.

This information has been prepared by Grant White who is a Portfolio Manager/Investment Advisor for Industrial Alliance Securities Inc. Opinions expressed in this article are those of the Portfolio Manager/Investment Advisor only and do not necessarily reflect those of Industrial Alliance Securities Inc. Industrial Alliance Securities Inc. is a member of the Canadian Investor Protection Fund and the Investment Industry Regulatory Organization of Canada.