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How to Thrive Amidst AI, Blockchain and Massive Disruption

Five recommendations to help plan for a decentralized future.

By Patrick Schwerdtfeger

Technology is redefining every corner of our world, and evolving along an exponential curve. The impacts will shake humanity to its core.

Wealth management professionals need to understand the trends and causal relationships in order to succeed; they need to understand the dynamics of disruptive innovation within capital markets; and they need to recognize the implications of an increasingly decentralized world.

To be clear, the impacts of technology are both positive and negative with the constant and countless improvements. Indeed, we’re optimizing our planet—company by company, region by region, country by country—in every aspect of life and business. Operations are becoming more efficient. Products and services are becoming more intuitive and integrated. The world is becoming more tech intelligent.

But there are also negative impacts on the way. Dramatic increases in productivity will diminish the value of human capital. Algorithms and robotics will displace literally hundreds of millions of jobs, including many financial professionals. Meanwhile, technology is enabling a shift from centralized to decentralized power structures. The combination is fueling an increasingly individualistic, tribal and self-reliant world. It’s leading to anarchy on a global scale.

In the financial sector, algorithms, artificial intelligence and blockchain are converging to displace traditionally “safe” white-collar workers. According to the Hackett Group, the number of finance employees per billion dollars in revenue (within the Fortune 500) is already down by 40 percent over the past 10 years. Sophisticated enterprise software platforms generate financial statements and strategic insights with the click of a mouse. This trend will accelerate in the years ahead, replacing entire categories of human capital.

There are basically three types of jobs that are safe from automation. The first includes truly creative people, including artists, architects, scientific researchers and business entrepreneurs. The second involves building complex human relationships, such as nurses, teachers and therapists. And the third involves highly unpredictable occupations—hired guns and problem-solvers come to mind—including everything from plumbers and electricians to project managers and corporate turn-around specialists.

Wealth management professionals can calibrate their value propositions to include these characteristics. Creative solutions, strong communications skills and a problem-solving mentality will define success in tomorrow’s economy. In addition, the following five recommendations can help people plan for a decentralized future.

Look forward. Don’t allow yourself to live inside an echo chamber, being those opinions you already agree with. Actively seek out opinions that contradict your own. The truest measure of intelligence is the ability to hold two opposing views at the same time. The world is becoming more decentralized, resulting in vastly divergent realities. Nobody’s willing to change their mind, and everyone has plenty of evidence that they’re right and everyone else is wrong. Do it differently. This is a form of anarchy. 

Look in the mirror. Success amidst anarchy requires defiant leadership! The most strategic thing you can do is fine-tune your unique value proposition. Open a document on your computer or pull out a notebook and write down your thoughts to the questions: Who are you? What do you stand for? Since the world is characterized by competing realities, you have to pick your reality and ignore the rest. You can’t change people’s minds. So, build your tribe and ignore the haters. The only thing that matters is your unique value proposition and how it differs from competing products or services. 

Look up. Introduce more premium options for your VIP customers. Take your highest price and multiply it by 10. What done-for-you solution could you sell at that 10x price? What would need to be included in order for that 10x price to be a great deal? Focus your marketing on that 10x solution. It will expand the frame around your business. It projects confidence into the marketplace. What would an industry leader do? Now, act like an industry leader!

Look down. Be the disruptor, not the disrupted. Watch for simpler and less expensive solutions for your most cash-strapped customers. Disruptive innovation often caters to the least profitable market segment first, so identify those cash-strapped customers and imagine what they want. Innovations down there will create disruption everywhere else. Generally speaking, they want simpler and less expensive solutions. Can you create those solutions?

Look side to side. Change creates opportunity. Set aside a couple of hours to evaluate your marketplace. What are your competitors doing badly? What do people complain about in your industry? Who are the cash-strapped customers, and what do they want? Capitalize on opportunities to steal revenue from adjacent markets. Don’t ask: Who’s going to eat my lunch? Ask instead: Who else’s lunch can we eat? Anarchy is an opportunity for offense, not defense.

In a nutshell, change is coming. Run toward those changes. Learn as much as you can about analytics, data visualization, algorithms, artificial intelligence and blockchain. Treat them as your friends, not your enemies. Change creates opportunity for those who help facilitate the transition. Be among those technology advocates, and you’ll already be better positioned than most within the financial sector.


Patrick Schwerdtfeger is a business futurist who specializes in technology trends, including big data, artificial intelligence and blockchain.  His new book is Anarchy, Inc: Profiting in a Decentralized World with Artificial Intelligence and Blockchain. 

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