The history of the last 10 years has been one of continuous change for IFAs – and CP121 presages even more.
Before rushing in headlong to take this on, now would be a good time for IFAs to pause and reflect on the nature of change and how best to survive it.
We have managed a number of major change programmes for insurance companies and believe there are lessons to be learnt.
The first principle of surviving change is to recognise that managing change, like any professional job, is a skill in its own right. It is a short thinking step for an IFA to conclude that because he or she is an expert in their own business, managing change in the same business should come easily. It does not – but the following lessons will help you avoid the worst pitfalls.
There is an old Chinese proverb that it is easy to wake up a man who is genuinely asleep but it is impossible to wake up a man who is pretending to be asleep. Many CEOs, when struggling with their company's latest change programme, would have done well to bear this proverb in mind.
Those who were wide awake recognised the issues and in so doing had a much better chance of mastering them. Some of those who were genuinely asleep to the problems they faced, and were fortunate to have been woken up to them by an internal or external adviser, had the opportunity to take the right actions to survive.
Those who were pretending to be asleep, or rather were kidding themselves that they were in control, suffered the worst consequences.
Managing change calls for its own skills and disciplines and there are four key lessons for survival:
Do not fool yourself about strategy.
Do not fool yourself about delivery.
Do not fool yourself about communication.
Do not fool yourself about the benefits.
These are practical common sense but just because they appear obvious it does not mean that they get done.
When we talk about survival, we tend to think about being flexible, fast and decisive rather than taking a longer-term strategic approach. However, it is very easy to find yourself moving decisively in contradictory directions and wasting a lot of energy in the process. When this happens, it is a sure sign that you have not come up with a strategy for survival. A strategy acts as a coherent framework for the short-term measures that you need to take.
Regulation is a good example of a major change that has potentially threatened survival. A tactical response to regulation is not sufficient. What is needed is a deeper understanding of the underlying intent of the regulations.
By adopting a strategy for dealing with the intent of the regulation, you will be ahead of the competition and less likely to trip over the detail as it emerges over time.
It is not really that hard – put something up on the wall and use it. If it is good it will stay there – and if it is not you will change it anyway.
A good golf swing can only be developed through meticulous attention to each and every action in the movement. Lack of concentration in any area can send your ball spinning off course.
A change project requires the same focus, the rigour and attention to detail that is at the core of successfully managing the delivery of change. Project discipline cannot be avoided if you want to deliver complex business change.
You have to plan, provide resources, assess risks, hold progress meetings, authorise costs and so on – if this is not your strong suit, make sure you have someone with the right skills to do it.
Delivery of the systems' components of a change programme is particularly difficult for one simple reason -a computer's powerful decision-making capability rests solely on its ability to distinguish a zero from a one.
Everything around it needs a great deal of unnatural precision to get it right. You need to work with it and control it to make sure it becomes the miracle worker you had been promised.
Communicating ad nauseam
The IFA's natural communication skills represent a strong suit in managing change. But the process of guiding clients through the complex maze of financial choices ultimately has a positive goal.
Paradoxically, the most effective way to deliver successful change is to spend more time exploring and discussing the negative rather than the positive aspects.
You will need to be able to connect up client needs, demands from regulators, software suppliers, admin, acc- ounting and so on – all from the point of view of what can go wrong. Every participant will be focused on their own concerns, so it is your job to keep everything connected by talking.
Benefits rather than results
Success in change management does not just mean delivering the change. It means delivering the benefits of the change.
The benefits are usually clear at the beginning of a project and clear at the end, but can easily get lost in between. With the best of intentions, it is very easy to drift into delivering something that does not actually generate any of the required benefits.
It is important to keep your eye on the benefits and test everything that you do aga-inst them.
Do not forget that the outputs of a project do not deliver benefits by themselves – benefits only flow when people successfully use them.
The whizzy, technically excellent, compliant, fault-free laptop sales system is just a pile of junk if the salesperson will not use it.
The willing user of a poor computer system will deliver more benefits than the unwilling user of a technically perfect system. Do not treat the people as an afterthought – work with them so they welcome change from the outset.
If you want to survive change, you can smooth your path by taking a strategic approach, focusing on the disciplines necessary for delivery, communicating continuously about possible weaknesses and remembering that change is all about delivering real benefits.