OpinionAug 18 2020

Adapting to the new normal

twitter-iconfacebook-iconlinkedin-iconmail-iconprint-icon
Search supported by
comment-speech

It is a given that even the most stable companies face drastic financial challenges in the wake of economic shocks, such as the one brought on by the coronavirus pandemic.

Studies showed that, following the financial crisis of 2007-08, many companies that failed to improve their operations saw their costs increase, and profitability deteriorate. 

Like many other professions, financial advisers are keen to recover quickly from the ongoing global crisis. Many have moved face-to-face meetings to virtualised calls and risk appetite profiles. Others are now investigating ways to fully digitise key interactions to weather current adversities within an increasingly lower-touch economy. 

As the new normal drives, a rush of creativity and unearths new approaches to doing business, we see three areas financial advisers should contemplate to deal with the current unprecedented state of play. 

1. Audit your attitude towards digitisation

Quarantine measures mean that companies around the world are asking their employees to work from home. Financial advisers, like the individuals they serve, are investigating means to meet emerging demands for remote advice, in similar ways as Tech giants Google and Facebook switched to distributed workforce models.

What’s more, in many cases this change might not be temporary. Even companies used to solely rely on physical office spaces are realising that meetings can be held over video conferencing platforms and workspace can be virtualised, giving them an opportunity to downsize offices and reduce overheads.

Coronavirus is forcing us to rethink the way we live, learn, and work. Businesses of any shape are undertaking quick internal audits and testing their business resilience to consider the most effective digitisation strategies.

They validate the reliability of distributed and cloud-based infrastructures to ensure that personnel can all access the resources they need to work from home, and most importantly in a secured manner.

Already, cybersecurity consultants have seen a surge in hacking attacks targeting companies who had to jump into a work-from-home mode, with limited safeguarded access and procedures. Fortunately, over 3,500 funded cybersecurity ventures are already seeking to change the way cyber risk is handled outside the office. 

2. Rethink your approach to risk management

Across the world, businesses in different sectors have been forced to cease operations with no notice. In some cases, the financial impact on financial advisers has been direct with losses of new business as buyers of financial products decide to postpone purchases until the market returns to some level of stability. 

All of this is to say that known risks are rapidly morphing into new risk types that financial advisers must quickly comprehend how best to evaluate to protect and advice their customers. 

As PWC points out, audit specialists and risk management professionals can, even in these unforeseen circumstances, help any firm deal with such new risks. Learning from and turning to these professionals could become a safe move for any and a great way to evolve more traditional offers. 

3. Adapt to emerging consumer trends

Crises commonly accelerate societal and economic shifts. It has been predicted, for example, that many of the jobs lost during the current economic turmoil will not return and will, instead, be taken over by automation.

This could take the form of retrieval robots at postage fulfillment centers, digital kiosks taking orders in fast-food restaurants in place of cashiers, or delivery drones dropping parcels. Would an increased automation enable financial advisers to offer customers more value?

Many customers believe so if they were able to access unbiased product advice. In 2019, three-quarters of financial advisers were planning to invest in automation within a five year-timeframe. It is likely that this prediction will accelerate through the form of cognitive automation (robotic process automation), analytics (real-time data collection, analysis and pricing) and engagement (conversational AI) vital to augment key services.

Covid-19 is impacting every sector, so move fast to stay relevant. There’s no question that now is the time for reinventing outdated business practices.

Radical thinking, combined with an adaptive experimental approach, is required to build resilience, add customer value, and limit future risk exposures post pandemic.

Sabine VanderLinden is co-founder and managing partner of the Alchemy Crew