Archive for July, 2017

Wealth Managers Day Of Reckoning

Friday, July 28th, 2017

 

The need for financial advice is at unprecedented levels, what is being increasingly exposed is the “competency and passion deficit” in many private wealth advisory firms. With greater complexity and ambiguity in their private clients’ lives, there is an increasingly unmet need for both increased “speed” (real-time decision-making) and higher “quality” (better performance, lower cost) resources. You cannot achieve that without new thinking, abandoning irrelevant activities and new approaches to regulation and compliance. A great many market practitioners question the sustainability of the robo-adviser retail advice model (Betterment, Wealthify and others) on account of their client acquisition costs but what is undeniable is that without old thinking and systems, they have a huge advantage for those seeking low-cost advice. For small and mid-market firms, who pride themselves on traditional advisory propositions, I confidently predict the next 12 months in N. America and Europe will see record consolidation and exits. The real question for the owners of these businesses, is the shortest route to your “ideal future” a friendly merger or sale now or driving on further into even more hazardous conditions with close to zero visibility?

© James Berkeley 2017.

 

A Time And A Place

Thursday, July 27th, 2017

 

What is the price of privacy and silence in a workspace? Money and demand are abundant from small medium enterprises wanting more flexible offices, and investors hurtling after them with bags of moolala. WeWork, the co-working giant, announced today that it has raised $500 million from SoftBank and Hony Capital to fuel its growth in China. I am helping another ambitious group charm professional investors with their Mandarin Oriental-style idea and secure north of a $100 million backing. Indeed, I write this sitting in my own upscale serviced office located in the heart of London’s West End.  Yet there is one drawback that almost all of these co-working/serviced office operators have not properly addressed. Co-working is great until you want privacy and silence. You struggle like hell to find it. Hip canteen or dining areas, noisy club lounges, and expensive, clunky meeting rooms with time-consuming booking systems don’t provide real-time access to the seamless professional environment and image that your most discerning clients expect. Perhaps in a techie world but sorry, not in a professional services or financial services firm. It is like asking an Englishman to adhere to a relaxed dress code at a wedding, it is carnage. I am sorry but I neither want to work in or be seen as an underpaid HR manager ghosting in a Starbucks mid-morning. Whether we like it or not, informality in a business setting has its’ limits on how we think about ourselves, our productivity and our profit.   The operator, who can truly provide a workspace with “flexible” privacy and silence is really the one to throw serious money at.

© James Berkeley 2017.

New Balls, Please

Wednesday, July 12th, 2017

Today’s Wimbledon: strawberries and cream. White tennis gear. Polite ticket queues. Live streaming. Rafa, Roger, Andy, Novak, Serena and co. The sliding roof.

Days of old: more strawberries and cream. Wooden rackets. Bjorn, Jimmy, BigMac, Pete, Andre, Rod, BillyJean, Monika, Martina, Steffi. Intermittent rain delays. Images that are indelibly linked in our minds to a time and place. Yet a (sporting) institution and participants that has successfully embraced reinvention.

When you look at your own personal and business reinvention, what are the strongest images in the minds of your key constituents (clients, investors, employees, business partners and so forth)? Does it say more about your “past” value, your “present” value or your “future” value? Perception is reality. What are you doing regularly to adjust others perception of you? (new interests, new relationships, new ideas, new surroundings, new images etc.) Is it bold enough for your current and future circumstances? (changes in technology, competition, market needs, client experience, and so forth)

Why wait for the umpire’s cry of “new balls, please”, when you can better control your own destiny?

© James Berkeley 2017.

 

Inconvenience Squared

Monday, July 10th, 2017

Sitting on a EasyJet plane last night in Nice’s Côte d’Azur Airport minutes after boarding and the Captain gets on the microphone apologising that due to inclement weather on route, we must wait 55 minutes on the tarmac in Nice because “he needs to free up the gate”. He then invites those who would like to look around the cockpit to pay him a visit when the engines are off.

Kudos for the leader of the ship for addressing the audience and his openness to entertaining the frustrated passengers (quite how that is squared with EU security protocols preventing access to the cockpit is something of a mystery). Yet the obvious thing to ask is why would you ask 170 customers to be inconvenienced to a great extent in boarding a plane that you know is going nowhere for a considerable amount of time? Why couldn’t you move the plane 200 metres to another stand?

Perhaps you don’t care or perhaps the airline’s priority is more important than that of its’ customers comfort?  I see the same thing in a number of businesses.  Think about the unnecessary inconveniences that you are asking your customers to tolerate for your benefit? What stops you changing your behaviour and applying common sense? Is it a material or immaterial reason (safety or Company Policy)?

Too often our best intentions to manage customers expectations are largely overlooked because we insist on dumb decisions which are clearly not in our clients’ best interests.

© James Berkeley 2017.

 

Nothing But The Truth

Wednesday, July 5th, 2017

Beware the tendency today to have opinions proferred by eminent people confused with facts by trusted media sources.

Today, the BBC’s Kamal Ahmed in a story about the growth of the UK’s gig economy, quotes Lord Adair Turner, a British economist and policy adviser, as “correct” in expressing his opinion that the failure to see a real rise in average UK wages since 2007 proves that the capitalist system is not living upto its’ promise to “raise all boats over a decade”.

The capitalist system promises to create an environment for maximising wealth creation. There is no better system at doing that. It doesn’t “promise” anything other than in fostering competition, there will be winners and losers.

A capitalist economy’s fault line comes in how it deals with both groups and how it distributes wealth fairly and equitably. Should a public company CEO earn 10x that of a brain or heart surgeon who saves lives or 300x their lowest paid employee? I happen to believe everyone, who is seriously intent on working, and contributing to society, should be able to have a job.

Where we are on unsafe ground as a society, is when prominent journalists with dominant global media platforms don’t self-check opinions expressed as facts. For who are we to believe?

© James Berkeley 2017.