Tuesday, 13 November 2012

Discovery - the key to survival for Financial Advisors

In the UK the FSA introduced new regulations for Financial Advisors called the Retail Distribution Review (RDR) on the 31st December 2012. The main aim of RDR is to ensure that the Financial Services industry returns to being a consulting and advisory service, based on fees rather than commission, and the regulators hope it will improve the reputation of financial advice and advisors. A dramatic impact on the industry is predicted and casualties expected. How is your implementation of RDR going?

Whenever a new way of working is introduced it can be difficult to find the time to work on what’s required and implement the required changes when you have current projects to work on. With new legislation to decipher, further qualifications required, and new policies or ways of working to put into practice, it can feel like an uphill battle to keep on top of things and this seems to be the case for many people and businesses implementing RDR.

Ad+, a team of chartered accountants and business consultants who are one of only 41 practices to be included in “The UK’s best accountancy services” used MindGenius mind mapping software to help them plan and prepare for RDR, and also see MindGenius as a solution for post RDR life. Matt Donnelly, Managing Director and Founding Partner strongly believes that better client engagement, through effective questioning and listening techniques, is the only way to drive the sales process and ensure identification of opportunities for both the clients and for businesses, especially in the post RDR landscape.

Matt believes the Fact Find stage of the process (fact find, research, advice and opportunities) needs to be transformed into an engaging Discovery style session that really gets to the heart of what clients are looking for in life, exploring things such as retirement plans, how they would like to look after their family members and charitable contributions as well as the hard facts of the client’s current situation.

MindGenius have put together a short video on a Discovery style session. You can view it here. This process is generally based on a template approach that balances the hard and soft fact finding process to find out; where we are, where we want to be and how we will get there. For the session to be a success it must engage clients in the process; effective facilitation and management when using the map template can ensure the session is interactive and keeps the client visually engaged. This results in a financial plan where the client understands how the plan works and the advisor is clear on the opportunities it presents.

Sample mind map financial plan
Fig 1: A sample Financial Plan from a Discovery Session
Whether RDR is relevant to you or not, this discovery approach is worth introducing to your client engagement.

MindGenius offers a free 30 day trial. Find out more at www.mindgenius.com/FinancialServices.aspx

Hoshin Plans for Vision Deployment

Mind Maps are basically tree diagrams that can take on a variety of forms. After World War 2, Japan used Tree charts (called Hoshin Plans) as a top down management planning tool to create, drive and implement the biggest quality revolution the world has ever seen. Hoshin Plans, which are Mind Maps, were elevated in Japan to one of the 7 most important Management Tools. They were used for annual strategic planning for entire companies and at lower levels for department level strategic planning and individual project management, tracking and execution. That detailed level of planning was seldom seen in the western world at the time and it is still considered to be a best practice method of planning today. Mind Mapping software offers very user-friendly and rapid creation and modification of the Plans, which was one of the original barriers that blocked its widespread acceptance in the western world. This article will give the basics on Hoshin Planning and show they can be created with MindGenius Mind Mapping software. 

History of the Quality Revolution in Japan 
It is undisputed that Japan created the biggest quality revolution that the world has probably ever seen. This quality revolution happened after World War 2. Lean and Total Quality Management were the top level initiatives that were used to create this quality transformation. At the core of such successes seen in Japanese companies are a variety of tools and techniques they used. In Japan, some of their main tools were summarized and popularized as:  

  • 7 Management Tools 
  • 7 Quality Tools 
  • 7 forms of Waste 
The number 7 was often used to narrow the focus of efforts and not over-complicate attempts to drive quality improvements, which could drive confusion and frustration amongst employees. Without applying the 7 Management Tools, Japan's success would have been a failure. Deming and others were instrumental in driving the quality revolution in Japan. Deming's first big activities and presentations in Japan were to its management. He convinced them to pursue a disciplined approach to make dramatic quality transformations a reality. After the great successes of Japan, the western world was very eager to copy their successes but they often ignored the detailed work required to attain such success. Many short cuts were attempted, which had limited successes or failed. The failed attempts almost always avoided the 7 Management Tools because they seemed too analytical and technical for western-styles of management to accept. What resulted in the western world is a method of "Cherry Picking" of certain Lean and Quality Tools used in Japan that would be applied in the West. 

Under-appreciated Hoshin Planning in the West 
A good example of cherry-picking certain tools from Japan and avoiding others is the Hoshin Plan Tree Diagram. This tool was very slowly adopted in the West but it is still, even today, rather unpopular. The Deming Quality Award was started in Japan in 1950 to recognize progressive companies who departed from traditional and ineffective ways of management to the successful management style known as TQM (Total Quality Management). All companies who won the Deming Award in the 70’s and 80’s reported that Hoshin Planning was at the center of their management style. 

The Hoshin Plan is often considered to be too detailed, difficult to create or use. It was often difficult and time consuming to construct and modify these Plans in popular software tools such as Excel and PowerPoint. I will make the bold statement that if user-friendly software like MindGenius was available when Hoshin Planning was first discovered in the West, the widespread use of this Planning tool might have been more popular. I say this because this powerful and effective Plan is extremely easy and fast to create and edit with MindGenius. 

Employee Empowerment versus Management Planning 
Japanese-style Employee Empowerment is also a widely misunderstood concept outside of Japan. Too often, it is thought that employee empowerment can replace top management planning, direction and vision setting. However, empowered activities must be in line with management's top level Vision, Goals and Objectives, not replace them to avoid uncoordinated chaos. Not every company can afford to pursue Six Sigma quality levels targeting only 3.4 defects per million products produced. Big problems can arise when the void of management vision and direction is filled in with the vision of quasi-empowered employees who invent their own agenda for the company, which is not coordinated with other employees nor management. 

Hoshin Plan Basics 
As shown below, such Plans can be used for top level management strategic planning and all the way down to individual project management, planning and execution. 

A Hoshin Plan should incorporate 5 levels of detailed work breakdown structure as shown below. At the detailed task level, personal task assignments, due dates and red, yellow and green color codes for the status are recommended for a good Hoshin plan.

Here are some explanations of the terms used in the above graph, which are used for Hoshin Planning. 

  • Vision: A mental image what the desired future should look like 
  • Goal: The full set of top level targets required to support the Vision
  • Objectives: The full set of stated intentions required to support all of the Goals 
  • Action Plans: The full set of actions required to support all of the Objectives 
  • Detailed Tasks: The full set of individual tasks required to support all of the Action Plans 

Note that the words "full set" is used often in the above list. In a good Hoshin Plan, each term to the right of the Vision should include a full set of exhaustive intentions and activities required to support the term to the upper left of it. What follows is a template for a 5-level Hoshin Plan created in MindGenius software with 5 levels, with added information in the far right branch for responsible resource, detailed task completion rate, start and completion dates and visual color codes for the detailed task status (red, yellow or green). This example is partially visualized, only showing the details for Goal 1. Red denotes that the plan is behind schedule. Green means that it is on schedule. 

All entries on a Hoshin should be full sentences with action verbs and nouns that are fully understandable by anyone reading the plan. At least 2 goals should be created for a vision statement and at least 2 objectives for each goal statement and so on, all the way down to the detailed task level. Any gaps in the tree down to the detailed task level would be a sign of a plan that is not supported by real actions in the organization. 

The following Hoshin Plan template shows what a 3 Goal Hoshin Plan could look like. The number of sub-branches on a real Hoshin Plan will vary for each plan but they can be easily created and modified in the Mind Mapping software. The power of the logic in a Hoshin Plan is that the creator is motivated to ensure that each goal, objective, task and detailed task are supported with real resourced activities and individuals. When such support is absent, it becomes very visually obvious that the plan is not supported by all of the detailed activities and resources required to make the activity successful. 

The next Hoshin plan shows a company vision that is at risk of being realized, due to gaps in the plan and the amount of red for those detailed actions that are documented. Such gaps in the plan are visually apparent on a Hoshin Plan. Other methods of strategic and project planning do not visually highlight inadequacies in the plan as a Hoshin Plan does. 

Hoshin Plans are very detailed and useful company vision deployment tools that can be used to ensure that all functional departments have their goals aligned with each other to meet the larger vision of the company. These plans can also be used at the department and individual project level. The true test if a Hoshin Plan is correctly completed is quite visual in nature. If there are gaps in the plan down to the detailed task level and if resources are not assigned to detailed tasks or the status is red, the plan is at risk of supporting the vision of the company or project. Too many current project management techniques do not have this automatic visual feature to ensure that a project plan is robust or not. 

About the Author 
David Patrishkoff is President of E3 Extreme Enterprise Efficiency® LLC. He has held various worldwide senior executive positions in the past and has trained 3,000+ professionals, worldwide from over 55 different industries in Lean, Six Sigma and other advanced problem solving techniques. He is a proven business turnaround specialist who resolves “Mission Impossible” situations for organizations on a regular basis. Visit his website for training, coaching and consulting services: www.eeefficiency.com. 

MindGenius and Connect Distribution Join Forces to Introduce MindGenius to CEE

MindGenius, the leading business mapping software developer and Connect Distribution are delighted to announce their partnership which allows them to offer localized help and support in CEE.

MindGenius has been producing mind mapping software for business and education since 2001 that allows users to capture, visualize and manage their information. MindGenius is the only mind mapping software tool that focuses on aiding key business processes and allows organisations to specifically delivers business value in activities such as project planning, brainstorming, strategic planning, task management and information mapping.

Connect Distribution Sp. z o.o., a company founded in 1998, is a specialized distributor of IT solutions with added value who deliver highest quality, world class software solutions backed up with consulting and technical support, for both the Polish and Eastern European markets.

Krzysztof Szubert, General Manager at Connect Distribution said: “Cooperation with MindGenius expands our product portfolio of mind mapping solutions to now include a tool that is more intuitive and a little cheaper than others in the market. We hope that MindGenius products will answer the requirements of small and medium companies, which are the majority of our customers in the CEE region.”

Derek Jack, Director, MindGenius said: “By partnering with Connect Distribution we have the opportunity to introduce MindGenius into the territory knowing we have solid local support, experience and knowledge there. MindGenius is one of the most cost effective software tools for delivering productivity improvements in business and we look forward to working with Connect Distribution to introduce it to their customers."

Find our more about MindGenius at www.mindgenius.com.