What some top leaders are saying about Rick Capozzi:

“The way Rick Capozzi frames the disruptive technologies facing the financial industry with the core fundamentals, people skills, quality of advice, and an exceptional client experience is brilliant. Rick has frontline experience building great businesses. Practical and timely, this book deserves to be read by every financial advisor who is serious about growth.”

—Matt Oechsli, CEO, Oechsli Institute

“After more than 40 years of selecting and developing leaders, I can say without reservation that Rick Capozzi has written a magnificent book on what it takes to be a leader in times of challenge and disruption. I have worked with Rick and for him over the years and I have seen first hand his ability to practice what he preaches. This book is a must read. It's a blueprint to greater success, if you absorb it, evaluate your own leadership behavior against it, and put it to work.”

—Jim Carbonaro, former SVP head of Leadership Development at Morgan Stanley, Wells Fargo, and UBS

“The Growth Mindset is a crucial almanac. I highly recommend everyone in the wealth management and asset management industry read it. The book addresses many thought‐provoking issues. For example, what was recently presented as the centerpiece of the value proposition presented to clients is rapidly moving to a commodity. Rick's years of experience and success in multiple leadership roles in this industry of change have given him license to produce this playbook to assist professionals in building and/or evolving successful business models to maximize the client experience. This is a must‐read if you're serious about growth. Enjoy the journey!”

—Mark Pennington, Former MD Partner, Lord, Abbett & Co. LLC

“The Growth Mindset is a must‐read. Rick leverages his vast experiences to outline the attributes of successful leaders. He tackles the challenges and disruption facing our industry, and offers sage counsel on how organizations should respond. Rick uses leadership quotes, interviews, and personal anecdotes to bring new concepts to life.”

—Anthony B. Davidow, CIMA^®, Alternative Beta & Asset Allocation strategist, Schwab Center for Financial Research

“Capozzi captures how leadership does make a difference in an ever‐changing industry experiencing extraordinary pace and magnitude with the current pivots. No matter who you are, or how successful, this book will inspire you to open your mind to larger possibilities.”

—Craig Pfeiffer, CEO of the Money Management Institute (MMI) and chairman of Advisors Ahead

“Rick Capozzi has written an outstanding roadmap for leaders in the wealth management industry. Capozzi has a unique talent for making the complex simple. He masterfully inspires you to stretch your capabilities and reach for greater heights. He advises business leaders to adopt a growth mindset, embrace leadership fundamentals, and create value for their clients.  His guidance  to focus on the specific target market and to “be all things to some people” is critical.  This book should be required reading in all MBA programs where we are preparing the next generation of wealth management leaders.

—Ellen D. Durnin, Ph.D., dean of the Business School, Southern Connecticut State University.

“Whether you are an experienced advisor, leader, or just starting out in the business, Rick has produced a fantastic book for all. This is by far one of the best books in sharing proven and practical strategies to grow a truly holistic and consultative business. Rick will inspire you to reexamine your business model. He shows you how to deal with fee compression and automated advice. Ultimately he will help you master the Growth Mindset, which will change your life and your clients.”

—Richard G. Dragotta, ChFC, CRPC, founder INC Advisors, principal LPL Financial

“As a result of Rick's work, today, every one of our advisors is in a much better position to compete.  We've seen a tremendous improvement in ownership and accountability of our people, leading to increased client satisfaction and loyalty. Rick's book is timely and will further advance the sales and service culture of First Tennessee Bank.”

—Rhomes Aur, CEO, FTB Advisors

Change is happening at an unbelievable pace, and few industries are experiencing change as much as financial services. Leaders need to be equipped to navigate this change in order to get results and help others adapt to the future. Having coached and trained thousands of leaders, advisors and staff in financial services I have had the privilege to be exposed to some of the most impressive thinkers and implementers in the industry. Rick Capozzi ranks as one of the best. His book The Growth Mindset has never been needed more than it is today. The challenges are big for the future and that means so are the opportunities. Leaders who study this book will be able to help themselves and others flourish in an environment where many others will flounder. In the end, if leaders find these opportunities and help others navigate them well, then the clients will be the ones who benefit the most. And that is the most noble calling of this business.

—Tim Ursiny, Ph.D., RCC, CBC, Founder, Advantage Coaching & Training, Author of multiple books including his most recent, Soft Souls Living in a Harsh World

The Chinese proverb says to know the road ahead, ask those coming back. Elite Financial Advisors did not become successful by accident. They all found someone with greater wisdom and greater experience to guide them to the top. Regardless of one’s tenure and accomplishments, every advisor needs a mentor. I have known Rick Capozzi for many years and I consider him to be one of the best, if not the best, mentor in our industry. It doesn’t matter if you are new and fighting to establish your credentials or if you are a top quintile advisor striving for greater heights, you need Rick as a mentor and the mentorship begins right here, with The Growth Mindset.

—Don Connelly, Former SVP of marketing at Putnam, National Speaker and Coach.

“Vision doesn't usually come as a lightning bolt. Rather it comes as a slow crystallization of life challenges that we one day recognize as a beautiful diamond with great value to ourselves and others.”

—Dr. Michael Norwood

Within the wealth management industry how we deliver advice and a superior client experience is fundamentally changing. These changes will have a profound impact on the role the advisor plays in serving the high‐net‐worth market. The greatest transfer of wealth in the history of the world is under way as baby boomers age and pass their assets to the next generation. This transfer of wealth combined with the rise of automated advice in the form of robo‐ and virtual advisors, online services offering algorithm‐based portfolio management, and a host of other factors will create one of the most significant disruptions to hit the financial services industry. In the face of this disruption, the future of our industry demands that advisors and managers evolve, lead, and serve. Those advisors who can deliver holistic and customized advice beyond investment solutions will be positioned to capitalize on change and win the lion's share of the high‐net‐worth market.

I have seen a lot of change over the past three decades but nothing like the amount of change happening right now. This tsunami of change is already making its way to the financial industry shoreline, and it promises to swallow up those industry professionals unprepared to act in the face of challenge and disruption. If you are reading The Growth Mindset: Leadership Makes a Difference in Wealth Management, it's because you want to survive the rip current and grow your business in response to this sea change in front of us. Of course, many people may not be ready. Leaders across the industry are struggling with fee compression, lack of differentiation, increased competition, technological revolution, and a sophisticated and demanding global client—all of which makes the future of wealth management demand that leaders and advisors evolve and master the fundamentals. The future model will focus on delivering customized value in which the client ultimately benefits. High‐net‐worth clients are not focused on cost; they are, however, focused on value. This book helps you differentiate yourself from the crowd not only by delivering advice and service but also by showing you what the clients value most.

Disruption, like a tsunami, can resemble a rapidly rising tide—a series of waves whose impact and destructive power can be enormous. Only the strong leaders tend to survive this type of disruption. From a position of strength, the leader must fight against the power of the current with the appropriate response—actions and behaviors associated only with great leaders, many of whom I have been fortunate enough to observe. These types of leaders will be absolutely required for an organization or individual to achieve success.

Whatever you do, don't let yourself or your firm become a casualty to complacency. Many leaders and firms tend to hit a plateau between seven and ten years in the business. Adopt and practice the leadership principles in this book that resonate with you the most, and lead your team beyond the plateau to achieve greater success.

Industry Challenges and Disruption

A leader's greatest motivation is a new challenge and greatest liability is insecurity. Whether he or she faces the challenges of the future head‐on with a healthy sense of confidence and optimism or retreats with pessimism and doubt ultimately determines success or failure. If you're a CEO or CIO of your own firm, you probably spend a significant amount of time developing strategies to not only help your firm grow but also protect your clients and employees. Some of the most relevant topics today include regulations, mobile platforms, cloud storage, artificial intelligence, blockchain technology, and cybersecurity. The incredibly fast rate of change, which requires a great deal of consideration and action, does not allow us the luxury of sitting back without investing back into the business and attracting the right talent.

Over the past 34 years working in the financial services, I have witnessed the necessity to adapt to change firsthand while working with top executives at the most prominent firms. Having served nearly all facets of senior leadership in many positions all the way up to the C‐suite, I am now witnessing a time unlike any I have seen before, primarily marked by the commoditization of our services by disruptive technologies. The challenges at hand are very real and have the potential to cause a changing of the guard, an army of increased competition and new players, luring our existing clients with an arsenal of choice. History is littered with examples of once‐stalwart, seemingly unassailable companies that simply failed to address change effectively and ultimately disappeared. Organizations that lack the right leadership assets—leaders who cannot face the following challenges head‐on—will not be able to compete effectively in:

• The war for top talent
• New technologies that promise to make current advice models obsolete
• Passive versus active money management
• Disruptive fintech organizations
• Fee compression and reduced margins
• Escalating regulatory landscape
• Sophisticated, value‐minded investors
• Increased competition and difficulty being distinctive

The financial technology industry promises to deliver financial services more efficiently and more cost‐effectively than the traditional investment advisory model while enhancing the client experience with better data reporting, greater transparency, and streamlined processes. We have been operating in an environment for the past 50 years that for the most part has been generous to the asset management and wealth management industry. But today we are dealing with a plethora of automated investing platforms, the shift of passive versus active management, fee and margin compression, and more regulatory change in the past five years than the past 40 years. Clients are increasingly more sophisticated and have access to virtually any information. Therefore, the future client will demand value for a reasonable fee and those that cannot deliver value will be forced to reduce the fee or look for a different profession. For example, investment management services should not be the only core value proposition going forward. That alone will continue to become increasingly more commoditized. Therefore, if that's your only value proposition, you will only be able to compete on price.

As an advisor, you have a responsibility to stay on the cutting edge of product innovation, process innovation, and service innovation. You have a direct responsibility to lead your clients and your team to model the behavior necessary to win the battle in front of you. Anyone in the organization can lead and make a difference if he or she is willing to adapt, grow, and learn what I call the growth mindset.

One of the most important themes of this book is that you don't become a leader by slipping on an impressive title, because we have all worked for people who are completely incompetent yet somehow occupy a prestigious position of authority. Leadership cannot be measured by the number of people reporting to you or the number of followers you have on Twitter. I have learned, I'm sure like many of you, that leadership is not some power that is bestowed; rather, you have to earn it and demonstrate it by your actions. Leadership is your ability to influence and persuade those around you, to act with a high degree of emotional intelligence, to use proper judgment, and to make the tough choices when no one is watching. Over the years I have learned a lot more from advisors about leadership than managers I reported to. These advisors didn't need the title because they were leaders from the start and they had sound principles and strong values.

“Results are obtained by exploiting opportunities, not by solving problems.”

—Peter Drucker

New players moving into our industry should surprise no one. With nearly $17 trillion in investment assets in play and a compelling annual growth rate of 8.4 percent, wealth management is one of the most attractive sectors within financial services, especially in the high‐net‐worth space involving $57 trillion globally.

Even less surprising is that technology is yet again unleashing a tidal wave of change in our industry. Our smart, sophisticated clients are always looking to take advantage of new technology and new players.

Rising competition and the other top trends in wealth management have led to automated advisors, predictive analytics to enhance the client experience, financial planning and advice tools, and integrated wealth management experience, according to the management consulting corporation Capgemini.

Many people in our space see technology firms' interest in wealth management as a direct threat to the traditional investment advisory model—and rightly so. If our new competitors can deliver better service at a competitive cost, then why should our clients stay with us? We'd better have the answer. Finding the right solution may mean we need to redefine our value proposition and accept that we'll have to innovate and reinvest in the client experience if we are going to remain competitive. If you're not sure, ask yourself this: Can artificial intelligence replace what I'm doing in the near future? Can algorithms replace ultimate responsibility for portfolio management? Can software deliver solutions that replace me? This is not the future; this is now. We are living in a 140‐character digital labor market. The future advisor will leverage digital labor and tools to create a better client experience and efficiencies and capture more market share. All we need to do is look around to see how brick‐and‐mortar is being replaced by digital, brick by brick and click by click.

Regardless of how big your book of business is today, your business model needs to evolve, including automating processes or outsourcing time‐consuming tasks such as investment management. Leveraging new technologies in your business creates more scale and efficiency, leaving you more time to build and deepen relationships. Not only do we have an aging client population, but we have an aging advisor population as well. Therefore, it would be wise for any team to think about the next generation because they will inherit billions of dollars. This new base of clients, generation X and Y, will want a different client experience. Technology will allow you to operate in real time through various channels. The time to start connecting to the next generation is now.

The Leadership Response

There is only one response to tackle these looming threats: leaders in the wealth management sector who embrace a growth mindset will continue to compete and outcompete the competition. In doing so, you will be prepared for anything that is thrown at you. There is a proverb in martial arts: “Master, why do you teach me to fight, but speak of peace?” The master replies, “It is better to be a warrior in a garden than a gardener in a war.” If you believe that we are in a war to capture client assets, to retain those assets, and to retain top talent, then you will operate with a sense of purpose, urgency, and focus. You may be the peaceful warrior with a mental shield of armor, but you're ready for battle, ready to protect your business and grow. But how? You may need to invest in new technology to serve a segment of your business with a different value proposition and cost. You may need to drastically improve your value proposition and service model. You may need to closely evaluate your team to determine if their skill sets are outdated. You may need to be more diligent about client segmentation. You may need to reevaluate your relationship with time. Are you spending it on high‐payoff activities? You may need to think about a partnership or acquisition. You may need to work on yourself because your leadership skills—and specifically your people skills—are paramount. We are, above all else, in the people business: we are people who work with people. We need to stay on top of the technological innovations that are changing our industry. But more importantly, we need to continue to leverage skills such as emotional intelligence, creativity and collaboration.

“While technology has eliminated many mid‐level jobs, pay is going up for senior managers, because skills such as emotional intelligence, creative thinking and advanced judgment are in short supply.”

—Korn Ferry, Executive Recruiters

To put it even more simply, we need to continue to grow as leaders. In The Growth Mindset, I want to share with you the tools and insights that I've gained from examining what makes great leaders in our industry so that you can compete more effectively with anything and everything that evolving technologies—and other competition—may throw at you. Technology advances and regulatory changes over the past ten years have brought new transparency to the wealth management process. This means that the client has access to all the information they need. Trust, therefore, will have even greater significance. Transparency about fees, portfolio construction, or anything that may involve the advisor–client relationship is not only a necessity, but the next generation will demand even more transparency.

In my own career in wealth management, I have been influenced by a diverse group of leaders from different backgrounds, across a variety of cultures, with very different approaches to the business. I want to share these insights with you because in my work I see too many missed opportunities for leaders—opportunities to do the right thing, create value, and make a real difference in the lives of the people they lead and the investors they serve. Seizing these opportunities is critical and will only become more essential as technology continues to affect how wealth management services are delivered.

“The world is more malleable than you think and it's waiting for you to hammer it into shape.”

—Bono

Over the course of my 34 years in the business, I have worked with about 42,000 wealth management advisors and managers in all channels—across wirehouses, Registered Investment Advisors (RIA), independent broker dealers, and bank trusts. I have worked with firms of 86,000 employees and firms of fewer than 25 employees and with managers and advisors from North America, Europe, the Middle East, Australia, and Asia. Each of these interactions had unique aspects—different structures, platforms, products, and services—deployed across different cultures.

Yet, one thing was consistent. One thing created business results. One thing made all the difference in people's lives: leadership. And successful leadership demands two things: one, they are brilliant in the fundamentals; and two, success is in execution. Success is never about being fancy with trying to achieve better results. Successful leaders achieve better results because they get the fundamentals right: the culture, the vision, strategies, and the right people in the right roles.

I'm referring to a very specific kind of leadership—what I call growth mindset leadership.

This book is a result of a lifetime of learning, thinking, talking, reading, and most of all working with many great leaders on getting better business results. At the core I have been a student of human performance since I graduated from college. And over the past three decades I have been playing in the arena of Wall Street with some wins, some losses, and my share of mistakes. The battle scars to inch out the competition made all of us improve our game. When I look back, I can gain perspective and reflect on the people who had an impact in my life and helped me shape my philosophy on human potential and growing a wealth management business. Writing a book is a massive undertaking and for the most part very enjoyable, but I'm not rushing to write another book anytime soon. One of the challenges of writing a book is the fact that any author wants to produce the very best piece of work; therefore, I tried to pay attention to the smallest details. But I never totally got comfortable letting go and saying to myself I'm done. Just like painting a landscape, even years after it's done, you feel one more brushstroke could make a difference. Therefore I'm sure I edited out 30,000 words before all was said and done. Though writing is a solitary activity and a nice change from speaking in front of a large group, I must confess I'd much rather be with a group of growth‐minded leaders talking about life and business than in my office typing away and doing research. The right people give me energy and ideas and are inspiring. I'll admit that as a professional speaker my mind is always on the lookout for ways to be more effective and persuasive.

One of the best parts of writing this book was the opportunity to meet leaders I haven't met before and reconnecting with old friends. I am grateful to my family and friends for their support and candid feedback and always making sure my feet are firmly planted on the ground. Thanks to my daughters, Bianca and Emilia. They create a deep joy in my life and I'm so grateful that we can share a life together. To my brother, Egidio, and my sister, Giovanna, for always being there for me. To my wife, Barbara, for always supporting my adventures and dreams.

I am grateful to all the advisors I have worked with over the years. This book would not have been possible without their friendship, support, and ideas. I am indebted to my friends who provided feedback and support, including Bob Dunwoody, Joe Grano, Jim Carbonaro, Tim Ursiny, Alex Murray, Jonathan Cressy, Rafer Kingston, John Christiana, Tina Powell, Kevin Sincavage, John H. Decker, Cary Greenspan, Sid Queler, Mark Casady, Dave Kelly, Courtney McQuade, Craig Pfeiffer, Lisa Carnoy, Rich Dragotta, Tony Davidow, John Hyland, Ira Wolfe, Stacey Glemboski and Jennifer Skancke. Thank you as well to the team at Wiley, who provided top‐notch support and guidance, including Julie Kerr, Michael Henton, Gayathri Govindarajan, Judy Howarth, Bill Falloon, and Shelley Flannery.

Finally, I beg forgiveness of all those who have played a role in helping me with this book over the past year but whose names I have failed to mention.