Advisor Speak 7th May 2015
Dear IFAs, consider this perspective
Jigar Parekh, Head - Training, Prudent CAS, Ahmedabad


The mood within distribution is not upbeat at the moment - to put it mildly. Service tax setbacks, new commission structures, volatile markets, increasing pressure from the growth of direct plans and confusion on RIA guidelines : there's enough and more to fill the cup of woes. It is in times like this that a different perspective helps. It is in times like this that Jigar's perspective is really useful. Yes, there are many challenges, but what Jigar asks you to consider is how you wish to respond to these challenges. Read on, consider Jigar's perspective and decide how you wish to respond to the current set of challenges.

Struggle, problems and challenges

As an Mutual Fund Distributors, last few years have been a lots of struggle and challenges for all of us due to multiple factors i.e. volatile stock markets, volatile debt market, introduction of direct plan, constant regulatory changes. Many of us are also complaining and blaming various stakeholders (media, regulator, AMCs etc.) for not helping us coming out of this struggle.

There is a brighter side to this entire struggle which I feel we should also focus on. Struggle is not bad, it's good. The struggle makes you more competent. The more you fight for your survival and progress, the stronger you will become. What I believe is that struggle is something which is required to build the strength. Whenever you try hard to come out of any problem, you become little better than earlier.

The more struggles you face, the more strength you will acquire,

The more problems you solve, the more wisdom you will develop,

The more challenges you face, the more competent you will become,

The more danger you face, the more courageous you will become.

Learning from the struggle of butterfly

Once a little boy was playing and found a beautiful caterpillar. He carefully picked it up and took it home. The little boy got a large jar from his mother and put plants to eat, and a stick to climb on, in the jar. Every day he watched the caterpillar and brought it new plants to eat.

One day the caterpillar climbed up the stick and started acting strangely. The boy worriedly called his mother who came and understood that the caterpillar was creating a cocoon. The mother explained to the boy how the caterpillar was going to go through a metamorphosis and become a butterfly.

The little boy was very excited to hear about the changes his caterpillar would go through. He watched every day, waiting for the butterfly to emerge. One day it happened, a small hole appeared in the cocoon and the butterfly started to struggle to come out.

At first the boy was excited, but soon he became concerned. The butterfly was struggling so hard to get out! It looked like it couldn't break free! It looked desperate! It looked like it was making no progress!

The boy was so concerned he decided to help. He ran to get scissors, and then walked back (because he had learned not to run with scissors…). He snipped the cocoon to make the hole bigger and the butterfly quickly emerged!

As the butterfly came out the boy was surprised. It had a swollen body and small, shriveled wings. He continued to watch the butterfly expecting that, at any moment, the wings would dry out, enlarge and expand to support the swollen body. He knew that in time the body would shrink and the butterfly's wings would expand. But neither happened!

The butterfly spent the rest of its life crawling around with a swollen body and shriveled wings.

It never was able to fly…As the boy tried to figure out what had gone wrong his mother took him to talk to a scientist from a local college. He learned that the butterfly was SUPPOSED to struggle.

In fact, the butterfly's struggle to push its way through the tiny opening of the cocoon pushes the fluid out of its body and into its wings. Without the struggle, the butterfly would never, ever fly. The boy's good intentions hurt the butterfly.

Learning for IFAs

The way butterfly need to struggle to fly, we also need to struggle a lot to fly the new heights into our business. We should look at all this struggle positively.

When I look at the journey of last 10 years into this distribution business, one thing I have observed is that every time whenever we have faced any problems, initially it had created a lot of mental pain but once we have dealt with these problems, things are improved compared to those before the emergence of the problem.

You faced a volatile market situation and a big correction in 2008, which made you more knowledgeable. You had to struggle a lot to improve your business model to cope up with the regulatory changes, which made you more competent and better in terms of quality of services. You faced the threat of direct plans, which made you struggle to become more client-centric. You faced the volatility into the debt market and negative returns in liquid fund, which made you more sensible in terms of your advice. You faced a threat of competition from big banks, you started focusing more on your brand building and started learning and applying guerrilla marketing strategies.

Every struggle and every problem which we have faced has made us better in past. Trust yourself, focus on client's wellbeing, and keep improving your knowledge and skill set to face further challenges. Try to control what is controllable, which is your behavior, your attitude, your skill set, your business model and stop focusing and wasting the time in discussing the things which are not in your hand.

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