“The only thing that is constant is change”, so said Heraclitus of Ephesos, and in the two fields of financial services and Formula One he couldn’t have been more accurate.
Mercedes may seem to be running away with the F1 Constructors’ Championship this year but, oh how things have changed for Red Bull since the last round of rule changes.
This is nothing new for F1 of course. Over the years we have seen a number of teams dominate particular eras, defined by certain rules – for instance McLaren in the 80s turbo era and Red Bull Racing in the more recent Pirelli tyre era. In between there were similar spells for Ferrari, Renault and Honda as rules changed around pit stop refuelling, engine size and safety features, along with a million and one other tweaks made on a seemingly endless basis.
In each case, the teams who adapted best to the changes were the ones who succeeded. Most recently this has seen Mercedes adapt best to the new rules and the previously dominant Red Bull Racing see their performance fall off a cliff.
So, it seems, the impact of change can be monumental, and in some cases can result in a shift in power or influence.
In pensions, under the old rules many people almost defaulted into buying an annuity, which was the accepted method of turning pension savings into an income.
But rules changed.
In financial services, the 2014 Budget changed the rules for pension providers, giving customers more easy flexible access to their savings. Annuities were suddenly no longer the default option and pension providers who adapted their setup to accommodate the new rules look set to benefit.
Recent research from Old Mutual Wealth suggests that just 16% of people approaching retirement expect to buy an annuity, compared to 65% of those currently in retirement.
Unless pure annuity providers change their model, they could go the way of Red Bull Racing.