FOFA to bring business model casualties
A consulting firm has predicted many financial planning practices and dealer groups will fail to successfully transform their business models to meet legislative demands.
Seaview Consulting director David Fotheringham said the Future of Financial Advice reforms would bring many casualties, reflecting poor strategy or poor execution, or both.
"A business improvement ambition will not suffice; a great strategy poorly executed will have the same result as a poor strategy implemented well - both will underachieve," Fotheringham said.
"Successful strategy execution comes from the discipline of sticking to the process of implementing change."
Fortheringham observed businesses that have successfully completed their transformation ensured that every team member was clear on the strategy, their role and their value in the process.
"The traditional approach of assigning the task of change to managers and asking them to implement it down through the organisation is flawed and fails to acknowledge each individual's strengths and weaknesses," he said.
"The alternative is to identify the right people across the entire organisation who can motivate and lead their peers," he added.
"Use this group to develop, test, and refine solutions before pushing change onto the entire organisation."
Fotheringham also referred to some of the basic guidelines for effective strategy execution, including adopting a culture of accountability, identifying early adopters within the business and focusing on delivering short-term outcomes.
Recommended for you
The Reserve Bank of Australia (RBA) has lowered rates to a level not seen since mid-2023.
Financial Services Minister Stephen Jones has shared further details on the second tranche of the Delivering Better Financial Outcomes reforms including modernising best interests duty and reforming Statements of Advice.
The Federal Court has found a company director guilty of operating unregistered managed investment schemes and carrying on a financial services business without holding an AFSL.
The Governance Institute has said ASIC’s governance arrangements are no longer “fit for purpose” in a time when financial markets are quickly innovating and cyber crime becomes a threat.
