Joe Duran

Duran Duranblog

Joe Duran

When machinery makes financial advisers' work obsolete

Staying current and reinventing ourselves will need to happen more often now than it has in the past

Mar 27, 2017 @ 11:21 am

By Joe Duran

A few weeks ago I travelled with some fellow entrepreneurs to spend six days in Vietnam and Cambodia. It was everything you'd imagine: exotic, beautiful and fascinating. The highlight for me was visiting the twelfth century temple at Angkor Wat, near Siem Reap in Cambodia. It's the largest religious monument in the world on a site exceeding 400 acres. The temple took more than 30 years to build, and according to our guide, more than 350,000 people (mostly slaves) worked on it.

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That's an awful lot of manpower. It's interesting that the rate of construction hadn't evolved much from the building of the pyramids in Egypt 3,500 years prior. And yet today we build skyscrapers and entire cities like Dubai in a fraction of the time. Man's productivity has surged with the use of machinery and technology.

EVER EXPANDING ROLE OF MACHINERY

This got me thinking about how machinery has typically been used to improve scale by replacing work done by man in a quicker and more efficient manner. But today technology is the new machinery, and rather than replacing heft and brawn, it's rapidly replacing brain and thinking functions historically performed by man. As a consequence, we are in an age where man's work is being replaced at a rate not seen since the industrial revolution. Only this time it's not manual labor being replaced; it's thinking labor. I created the chart below to illustrate this paradigm.

The man versus technology output paradigm

The two axes measure output and complexity of decisions being made by machinery versus man. As computers become more powerful and software more sophisticated, this shifts the equilibrium point (the point at which machines are more efficient than people) out to the right. We have seen an ever expanding role for computers, from machine response call centers to self-serve websites to AI-powered data analytics.

We are in a period where the equilibrium point is shifting to the right faster than ever, revolutionizing the competitive landscape in every industry and changing the very nature of work within them.

WE ARE ALL NEXT

No industry can be sheltered from the impact of the expanding role of technology, and regardless of how or where you work, you can expect it to affect both your client interactions and the way your office runs.

In the client experience: We need to expand our engagement with our clients to go beyond investing and planning, functions machines are already taking over. We have to become more digitally and mobile resident. We need to accept transparent pricing and know that we have to deliver more value to retain fee structure or face a cut in our pricing.

In our offices: We have to use machinery to drive efficiency, and our support teams will need to evolve with the changing nature of work. We will need to outsource more and spend more on technology.

ONLY ONE WAY TO WIN

There is only one way to win if we don't want our offices to become relics of a bygone era. We need to embrace new ways of working and understand that doing nothing right now is one of the most dangerous choices we can make.

We have to harness the power of technology to make it work for us. We need to become bionic and embed the ever-expanding power of machinery into how we work every day. We also need to realize that staying current and reinventing ourselves will need to happen more often now than it has in the past.

(More: What advisers can learn from Google about maintaining relevance in a changing world)

The Angkor Wat temple is majestic and was an amazing feat in its time, but there's no one living in it today. Everyone now is taking photos of it and sharing them in real time over social media.

Joe Duran is chief executive of United Capital. Follow him @DuranMoney.

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