Given current market forces — fiduciary pressures, margin compression, and the commoditization of advice — you may be facing obsolescence if you continue business as usual.

If you’re an executive responsible for managing a bank investment program here are the questions you should be asking and creatively crafting answers to.

1. What is our differentiation in a commoditized industry?
Transactions, and even basic advice, are commoditized. How do you add value to justify your existence? Focus on the two dimensions of differentiation: value proposition and client experience. The best value you can provide clients can be seen as the lessons from behavioral finance: prevent clients from rash financial decisions, help them sleep at night, lower their blood pressure and help them make sure their kids turn out ok. As for client experience, the most critical elements must be standardized and part of the culture. For one obvious example, look to Disney.

2. How do we maintain profits in a compressed margin environment?
You need more than one or two delivery channels. The cost and skills of each delivery channel should be correlated to the opportunity size and need complexities of the market segments it is mapped and triaged to.

3. Advisors are the most expensive sales channel – are they focused on only the most appropriate sales opportunities?
The days of a one-dimensional sales model are over. Field-based advisors can no longer service all comers. Letting advisors service the middle market is like hiring Emeril Lagasse to flip burgers at Burger King – it just doesn’t make sense.

4. Are our high-level opportunities being handled most appropriately?
Clearly your higher-net-worth segments have the more complex needs and represent your biggest opportunities. Are these segments handled effectively by your organization? If so, you are managing the majority of the investable assets of these segments. If not, then you have work to do.

5. Are there more efficient ways to handle lower-level opportunities?
Do you have a centralized investment center, robo and associate advisors? Or are your branch-based advisors handling everything (and nothing as well as they should be)? Lower net worth clients have less complex needs that can be serviced more simply, typically by phone, self-service, or lower level representatives. And the costs of these delivery channels are more in line with the opportunity size.

6. As branches become less relevant, how should our advisors be building their business?
Branch traffic is down. According to The Wall Street Journal, banks shuttered 1,700 branches in 2017 — the fastest decline on record. Our channel was built on a branch-based advisor model. How does the way these advisors develop new business have to evolve?

The implications of these questions are significant and point to a cultural change for most organizations.

7. As branch traffic declines, how do we uncover opportunities in the new digital traffic patterns?
We put advisors in branches to get in the way of branch traffic. As branch traffic evolves into digital traffic how do we get in the way of that traffic? You better start getting good at data mining.

8. Should all our advisors be in branches?
One of the best things currently happening in our channel is the rise of the “second story” (book-based) advisor. This means our channel is growing up. Advisors are developing relationship-based books of business and can work out of “wealth offices” instead of branches. These advisors are serving HNW clients they way they should be served. We need to reinforce this type of growth.

9. Do we have a talented farm team?
We can no longer rely on dropouts from the wirehouse channel or stealing from each other for talent. We must do the harder but more beneficial work of home-growing talent. A rigorous associate advisor program is a necessity for profitable survival.

The implications of these questions are significant and suggest a cultural change for most organizations. However, working hard at change will have significant payoffs. Find good answers to these questions, prioritize a resulting action plan, decide on step one, get your arms around that and move to step two. A one-step-at-a-time measured and managed approach to becoming a best-of-breed program for this new market environment is a worthy and rewarding undertaking.

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