Leaving aside the merits of the arguments about enforcement of a fiduciary standard by the CFP Board, raised recently by CFP practitioner Allan Roth, the controversy Roth has touched off is a lesson in the disruptive power of the Internet. The asymetric power of one person with a strongly-held belief challenging institutions publicly has accelerated change in American society. It is disrupting institutions and business and changing lives.
Sociologists will look back on this era fondly. It is a turning point in civilization. We are living in the middle of an historic change-storm.
To compete, new approaches must be considered. You can't expect to be successful if you are essentially providing the same services you did five years ago.
Roth two weeks ago posted
to The Wall Street Journal’s
Total Return blog questioning the CFP Board’s commitment to enforcing the fiduciary standard.
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A sole practitioner who is likely unknown to the vast majority of the nation’s 63,000 CFP licensees, Roth's very-public accusations in WSJ led the CFP Board to issue a public response. The questions Roth raised has triggered a public debate on enforcement of the fiduciary standard by the CFP Board that is likely to spread soon to the consumer press.
A few years ago, it would have been impossible for a single person to take on a professional licesning organization, regulator, trade association, company, or government agency. Now anyone with a fair claim on public trust has a platform to speak truth to power, and it can go viral in a small but important community and change institutions. This backchannel is accelerating change in our culture.
The openness of the Internet is causing such immense disruption because all of a sudden institutions must explain their actions and be transparent, the way the CFP Board had little choice but to respond to Roth.
Incidentally, transparency will also be demanded of advisors. Those embracing transparency as a core value stand a better chance of success, as more consumers demand you do he right thing fo in the new world of financial advice business.
And if you really have original ideas on a topic a small group of people are passionate about and can advocate for clients on the Web, you may find yourself suddenly in the spotlight like Roth has.
If you have ideas people truly value, you can tap the disruptive power of the Internet and make it work to your advantage and also make the world better.