2024 – The Year of Strategic Rethinking

Amar Pandit , CFA , CFP

Amar Pandit

A respected entrepreneur with 25+ years of Experience, Amar Pandit is the Founder of several companies that are making a Happy difference in the lives of people. He is currently the Founder of Happyness Factory, a world-class online investment & goal-based financial planning platform through which he aims to help every Indian family save and invest wisely. He is very passionate about spreading financial literacy and is the author of 4 bestselling books (+ 2 more to release in 2020), 8 Sketch Books, Board Game and 700 + columns.

Before I get into the first post of the year, there is something I wish to express: my heartfelt gratitude to you for all the love, encouragement, and support you have extended me over the last four years since I started this blog…Yes, it’s four years!!! What started as a modest journey with just 50 readers (of which 20 would have been my team members), this blog is now read by 14000+ mutual fund distributors, employees and executives of asset managers, and registered investment advisors across India. At the last count, you have allowed me in your inbox 427 times. I assure you that I take this privilege seriously. This is my 428th post but I write this with the same enthusiasm with which I had written the first post.  My vision for the blog is simple: to make a meaningful and happy difference in your life while inspiring, motivating and guiding you to build the wealth firm of the future. As always, I would love to hear from you – bouquets or (constructive) bricks – both are welcome.

George Bernard Shaw wrote, “Progress is impossible without change, and those who cannot change their minds cannot change anything.”

Changing your mind is not a sign of weakness; it’s often a sign of strength…It means you are open to learning.

Embracing change, especially in the dynamic landscape of our industry, is the cornerstone of building a world-class wealth firm. As financial professionals, the willingness to evolve with the times, to challenge the status quo, and to innovate in the face of new information is not just valuableit is essential. This openness to rethinking, unlearning, and relearning leads to a deeper understanding of the market’s rhythms, the subtleties of client needs, and the emerging technologies that can revolutionize the way of building a super valuable firm.

A world-class wealth firm is not built overnight nor from a static blueprint. Creating such a firm takes time and a culture of ongoing learning. Everyone, from new hires to you, should keep questioning and learning. This way, the firm stays strong through market ups and downs, regulatory changes, and shifts in what clients want (consumer behaviour). Here, changing your mind shows strength—it leads to better ideas and strategies that help both clients and the firm.

Prof. Adam Grant in his book, “Think Again”, wrote, “You probably don’t recognize his name, but Mike Lazardis has had a defining impact on your life. Mike’s first success came when he patented a device for reading the bar codes on movie film, which was so useful in Hollywood that it won an Emmy and an Oscar for technical achievement. That was small potatoes compared to his next big invention, which made his firm the fastest growing company on the planet.

Mike’s flagship device quickly attracted a cult following from Bill Gates to Christina Aguilera. “It’s literally changed my life,” Oprah gushed.

Mike Lazardis dreamed up the idea for the Blackberry as a wireless communication device for sending and receiving emails. As of summer of 2009, it accounted for nearly half of the US smartphone market. By 2014, its market share had plummeted to less than 1%.

When a company takes a nosedive like that, we can never pinpoint a single cause for its downfall, so we tend to anthropomorphize it: Blackberry failed to adapt. Yet adapting to a changing environment isn’t something a company does- it’s something people do in the multitude of decisions they make every day. As the cofounder, President and Co-CEO, Mike was in charge of all technical and product decisions on the Blackberry. Although his thinking may have been the spark that ignited the smartphone revolution, his struggles with rethinking ended up sucking the oxygen out of the company and virtually extinguishing his invention. Where did he go wrong?

Most of us take pride in our knowledge and expertise, and in staying true to our beliefs and opinions. That makes sense in a stable world. The problem is that we live in a rapidly changing world, where we need to spend as much time rethinking as we do thinking.

Rethinking is a skillset, but it’s also a mindset.

 In our industry, just like Mike, many of us take pride in our knowledge and expertise.

And we don’t like changing our mind. We don’t consider rethinking…Partly because we think we know what we are doing.

At this point, it is quite possible that you are thinking – I don’t see this as a threat for me. Unlike Blackberry, I will continue to exist because my clients need me. They won’t get anyone else besides me and I have been with them for so long. So, they are used to me.

Given the nature of our business, some part of this statement is true.

The part that you will continue to exist (because you do not require a lot of clients) is the only part that is true.  Additionally, you will also get a mark to market appreciation in your AUM and revenue. You might even be felicitated by Asset Managers which is likely to distract you from the real situation in your business.

There are many truths that you might not be thinking about – First, there is no real organic growth in many firms…in fact, growth might be an issue for you too. Second, there is no real value that you are building in the firm. There are very few takers for such firms. Even if you never want to sell, the question is what is the legacy you wish to leave. Third, some of your key clients (with sizable AUM) are likely to leave you for other firms.

As you embark on this year, ask yourself:

  • What knowledge do I need to acquire to build a valuable firm?
  • What skills do I need to hone?
  • How can I better communicate my firm’s unique value?
  • How can I delight my clients?
  • How can I get most of my clients to refer to ideal clients? What is the best way for me to grow the firm?

 The answers to these questions will form the blueprint of your progress. They will guide you in making the necessary changes to your mindset, your business model, and your client engagement strategies.

The question: “where do we stand today?” directly affects where we would possibly stand tomorrow.

We all want to build world-class firms. At least, most of us do. But not everyone has a clear path to that goal.

We can complain to our friends, and discuss with other financial professionals in similar situations…but that will not change the situation.

On the other hand, getting clear about the current reality (and problems) will help us come up with realistic goals. Then comes the hard work of planning to achieve them.

The journey from where you stand today to where you aim to be tomorrow is paved with decisions that require a willingness to shift perspective, to adapt, and to evolve. It’s about confronting the hard truths of the current landscape and daring to imagine a different future.

So, how do you get there?  It means recognizing that your growth as a leader is inseparable from the growth of your firm. 

You are your firm’s biggest asset. Your business can only grow as much as you do. If you don’t know how to communicate your value proposition, it will be harder for you to compete for 100% wallet share or high net worth clients. If you don’t know how to delegate, it will be harder for you to build a valuable firm (yes, you might be able to build AUM but not a valuable firm). If you don’t know how to collaborate and leverage, you’ll find yourself overwhelmed (overworked) and unable to scale your operations.

To grow your firm into a valuable entity, you must also master the art of strategic rethinking. It involves stepping back from the day-to-day operations to see the bigger picture and to plan for the long term.

In essence, your journey to building a world-class wealth firm is marked by continuous personal development, strategic delegation, and fostering a culture of teamwork and innovation. It’s a journey that not only enhances your firm’s value but also enriches the financial well-being of the clients you serve.

The road ahead is one of transformation – a transformation that demands a shift from mere transactional relationships to forming deep, trust-based partnerships with your clients. Your commitment to growth, rethinking, unlearning, relearning, and change is the catalyst for creating a firm that not only survives but thrives in an ever-changing environment.

In 2024 and beyond, let the pursuit of excellence be your driving force. Let the spirit of curiosity be your compass. Build a firm where change is not feared but welcomed as an opportunity for growth. And remember, the only limit to the success of your firm is the extent to which you are ready to rethink, unlearn, relearn, and adapt. Your path to becoming a world-class wealth firm starts with a single, powerful decision to change your mind and open up to a world of possibilities.

What are you going to change your mind about in 2024?

On that note, I wish you and your family a Very Healthy and Happy New Year 2024…