Visual Management Systems
At the DFW FPA conference I had the distinct fortune of sitting next to Hanna Joy Moore, where she showed me her innovative tool BudgetingBlocks. What she has found is a simple, elegant way to help clients visualize budgeting choices. As an industry, I believe we intuitively understand the value of visual management systems—this fact is prominently clear in the widespread use of technical analysis charts to depict everything from interest rate behavior to sector performance to the broad markets. Here within BPI, we use visual management systems like Heijunka boards and Kanbans to help us learn how to improve our process for clients.
Providing financial advice in a world-class way in the modern era is a multifaceted endeavor. In almost all cases, the concepts we work to teach clients are conceptual, lacking physical representation. Today, by and large, money is a conceptual construct—a digital construct. We all once carried around cash. “I don’t carry cash on me,” internationally renowned hip-hop artist Drake says on a recent song, “because the money is digital.” Today most of our physical value is held in a computer somewhere, represented in physical form only by 1’s and 0’s on a screen.
New advancements in managing monthly cash flow (like scheduled autopayments) have in one sense made the store of value easier. In another sense, these tools actually further remove us from the actual stewardship of value, and ironically serve us in making us less thoughtful about the decisions we make every day when it comes to our financial health. For this reason, bringing back a tool that gives us a physical representation of our choices can be pivotally helpful—a return to the utility of tradition, if you will. Of course, one can always use the envelope method of budgeting—but realistically are you ready to carry around thousands of dollars in envelopes? As someone that manages risks both large and small on behalf of clients, incurring both the cost—and risk—of literally carrying money around seems anachronistic. Think of this another way—if your clients didn’t know how to create value via budgeting for themselves, how would they have come to possess the assets they need you to invest on their behalf, by definition of your role?
All of that to say—I was keenly excited to talk with Hannah about the BudgetingBlocks system that she engineered. Like most quality visual management systems, the idea, once presented, seems obviously and readily apparent. This system brings a needed simplicity, clear visuals—and even fun—to the budgeting process (I don’t know if my spouse is ready to gamify budget night, but I know she is all about making it a better process!)
As an advisor might this tool be helpful for you? I can’t know the answer to that question, but I think it’s good to be aware of the options. The value will ultimately depend on the nature of the clients you serve, and the services you provide for them.
Improving a process is the most valuable thing we can do for our clients—even though it goes unnoticed by them, and we can never put it in a glossy sales brochure. At BPI, we see this as a continual process where we “plan-fully” desire to see the problems first—the idea is that what is already going well will take care of itself. This is why I believe visual management systems are key to improving the situation. My exhortation would be—make sure the tools you use to visually depict and study your process are leading you towards, and not away from, your desired outcome.
Written By: Chad Ramberg
Today’s BPI Advice: Take note of the visual management systems you use. Are they effective in teaching you what they are there to teach you? Do the visual systems you use help you find and understand challenges, so that you can learn a better way? Ask yourself the right questions, and you will find the answers you need.
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