We live in a “do-as-I-say-not-as-I-do” immersion chamber. Such seemingly benign hypocrisy is so pervasive that we are blindly oblivious to it. And, though there are many targets at which we could point this critique, let’s take the research and advisory business for capital markets and financial services – since the FSI ecosystem is the purpose of the work we are starting here.

Digital everything / digital anything quickly went viral; becoming the bumper sticker for 2015. Those of us in thought-leadership and punditry circles spent the last several months insisting to our clients that they absolutely must leave their analog legacies behind and become more digital immediately – or else all manner of doom and gloom will wash over them. Good news: this mantra is way overdue – and will need to be reiterated with greater specificity and maturity for the foreseeable future. And, though becoming increasingly pervasive in industries like retail and entertainment over the past several years, the concept of digital transformation is quite new to the financial services industry – with the possible exception of the retail banking end of the business spectrum. And yet, the tangibility of fintech innovation has quickly and oddly become obvious.

The bad news (or at least the humor in all this)? Research and advisory groups are painfully analog, too! This takes us back to the “hypocrisy”: We talk about how social media, big data, high performance computing (HPC) and open standards have all converged in the Facebook-era to symbolize the “digital revolution” without much consideration for how we might manifest a radical shift in the progenitor of all processes: the research function. Analyst groups of all shapes and sizes are as analog – if not, more so – as their clients. This is why it seems that the space (for research and advisory services) has become so challenging. Truth is there is no blame to assign here. Everyone is pretty much in the same boat because – as our clients continue to re-discover – change is incredibly challenging. Political dynamics and cultural inertia typically represent the biggest piece of this challenge. As they say, behavior modification is always the most difficult variable in the process algorithm. Beyond that – and this is another one that comes from personal experience – research and other labor-intensive functions are not where it is customary to find a noticeable amount of process re-engineering, automation, or vision for augmented productivity.

The answer? Oftentimes, innovation needs a politically-shielded environment to gain traction and staying power. The Barclays Accelerator is a decent example of this in the FSI space. There are many others, including the Fintech Sandbox or SWIFT’s fintech innovation initiative, Innotribe. The point, though, is that even the atmosphere at smaller firms – like most research boutiques – can lack the oxygen for product or process innovation to take hold. Sometimes you just need to start something new and sufficiently untethered.

The challenges are only getting bigger. Just like in trading and capital markets, the growth in “signal” has not kept pace with the unprecedented growth in “noise”. Social media – for better and worse – provides a very low bar to develop the potential to wield a very large megaphone from which to share opinions. For the most part, the escalation of opinions is the “noise”. The signal comes from the data. So, if you aspired to be a credible advisor offering uncommon intelligence in the digital era, you would need to start by “eating at your own kitchen”. Meaning: leveraging digital-era tools, technologies and methods in the development, packaging and distribution of your products and services. For extra credit, you might also strive to exemplify the cultural and organizational dynamics that are integral to the effort to achieve digital transformation. (Some might say that cultural dynamics are the rule, not the exception.) These pillars might include tools and methods like crowd-sourcing, infrastructure-as-a-service (IaaS), collaboration and partnering, and visualization – to name only a few. In this way, those executing a more digital research model would become aligned with its clients on both the challenges and potentials of this profound digital era, thereby further reinforcing the credibility and value of its offerings.