In school, you’re taught a lesson and then given a test. In life, you’re given tests that teach you a lesson.
Sometimes, though, one does not learn one’s lesson, to which I will testify shortly. I hope this fate does not befall the annuity industry which stands on the brink of choices that will define the market for years to come.
Two years ago, speaking at the Henry Stewart retirement briefing, I used the Dr Seuss creation The Lorax (a furry orange creature) to illustrate how advisers were increasingly gravitating towards blended retirement solutions and away from single stand-alone solutions. My link, beyond tenuous, was that a ‘one size fits all’ approach rarely fits anyone, drawing comparison to universally sized gloves that end up making my fingers resemble those of… The Lorax!
Talking to advisers at the same conference last week it was Lego and Harold Bishop from Neighbours who were charged with the task of elucidation. Despite their best efforts (I counted three fewer tumbleweeds than two years ago) their success was not quite what had been hoped for.
What Lego and Harold represent, though, is the opportunity for salvation – not a sentence I ever envisaged writing!
By the mid-90s Lego’s empire was beginning to crumble as video games dramatically increased their hold on kids. Lego had lost touch with its audience.
Drastic steps were taken to reorganise and streamline the company leading to manufacturing plant and distribution centre closures. But today the toymaker is once again a player in the global toy market, with sales up 21 per cent and profits having grown 41 per cent in the last three years.
The real shift was a cultural one. Lego decided to become “laser-focused on understanding children and everything that they love” admitting that “with so many options available to today’s kids, it is critical that we stay relevant in their multi-tasking mix”.
There is no greater truth in business than the tenet that nothing is permanent. To remain relevant and profitable, you must evolve.
The trouble is, when there’s no pressure to do so, because people are buying your products irrespective of the value they offer, the culture of innovation quickly evaporates.
Let’s hope a flirtation with death yields a great new beginning for the retirement industry. In the words of Anne of Green Gables author L.M. Montgomery, isn’t it nice to think that tomorrow is a new day with no mistakes in it yet?
Phil Wickenden is founder of So Here’s The Plan – firstname.lastname@example.org and @PhilWickenden