Communication

Know Your Client Communication Behavioral Finance

WTF DNA (Why Try Financial DNA)

So, you’ve decided that using a behavioral finance tool can help your practice. You have taken the trial, learned from the training how DNA Behavior’s tools work, and how to understand your different types of clients. Now comes the most important part: how do you implement these new tools into your office’s routine? Good financial advisor offices are like singers: they can all sing “Sittin’ on the Dock of the Bay,” but not all audiences will like the way certain singers add their twist on the song. Most good singers are able to read their audience and know when to change their tune. As a financial advisor, do you know how to read your audience and change your approach? That’s what we’re here to help you with.

Many of the questions we get revolve around wherein the client acquisition cycle the discovery process should be implemented. Several current clients of ours will not schedule a meeting with a new client until they have completed a Communication DNA Discovery. This happens for several reasons:

 

  • So they know best how to open the conversation with the new client
  • How you present to a Goal-Setter (get to the bottom line) is very different from how you would speak with a Stability person (Soften your tone)
  • Having this one key piece of information can be the difference in winning, or losing this client and offers an immediate differentiation from competitors

Let’s say, Charles, an advisor, just met with the new client and understands their preferred method of communication. What comes next? Before any talk of investments or portfolios comes into play, Charles must understand their natural tendencies. This is where his new client should complete the Financial DNA Natural Discovery process which really gets under the surface so he can truly understand what their goals are. But, Charles needs to understand a couple of key points before putting this in place. The first key is that he needs to commit to it. He must have a complete buy-in that is obvious to his clients. When they see how important it is, their buy-in will be that much easier and will simplify the rest of the process. The second key is that it needs to be early in the process. Charles needs to figure out if he can work with this prospective client so he’s not wasting his time with someone he won’t be able to please. Otherwise, if Charles doesn’t let them know how important this can be they will have a hard time completing it if he does not convince them that these tools are essential to the success of their relationship.

It is important to remember that the power of DNA Behavior’s tools is in the questions we give you to get the conversation going in the right direction. You will be able to naturally connect with 40% of the prospective clients that walk through your door. Will you be able to change your song to connect with the other 60%? The answer is now a simple YES.

Try Financial DNA for yourself today.

 

behavioral fnance

So You Think You Know Me? Here’s What You Missed

Do you think your sales team is connecting (i.e., maximizing revenue) with all the advisors in their territory? They might tell you they are but read on.

I’m very intuitive, said the wholesaler of a major asset management firm. Excellent, we should get along very well, I replied.

I was talking with a wholesaler who wanted to learn more about one of our behavioral solutions, Communication DNA.

The wholesaler’s goal was straightforward: Show me a solution that decreases the amount of time it takes me to get to know an advisor so trust can be built immediately.

The wholesaler was skeptical about what I was saying so we decided to do a test. We had been talking for 30-minutes (about the same amount of time you talk with an advisor) when the wholesaler suggested to me that he could already tell exactly what “type” of personality I was.

Game on, I said.

OK, here’s what I’ve gathered so far about you in the first 30-minutes:

  • Fun
  • Fast-paced
  • Very sociable and enjoys people
  • Likes to take the lead

So what did I miss? asked the wholesaler.

Just a few pieces of critical information that most sales people miss about me (and why they lose the sale):

  • I can be very fun but turn into a “driven, goal-oriented” individual, especially under stress. Do you think an advisor’s job contains any elements of stress? As a wholesaler, you could keep going down the fun path when I have taken a sharp right turn. If you are not with me, I may smile and act like I am listening, but I have totally disengaged.
  • Getting me to make a decision: Tell me stories about how you have helped others like me. Don’t try any other “closing technique.”
  • Trusting you? I am loyal beyond belief. But you need to prove yourself from both a competency level and people skills in equal amounts.
  • The amount of detail: Don’t confuse me with the facts. High- level first or I will not even listen or worse yet, cut you off. I will let you know how much and when I need details so follow my lead.

Now the wholesaler was ready to listen: How could I possibly get all this behavioral intelligence before an advisor even decides to do business with me?

You don’t have much time to create a good impression and to get an advisor to trust you. Find out how to become a behaviorally smart wholesaler. Your business success depends on it.

Robo Platforms Are Missing Personality

Robo-Advisor Platforms Are Missing Personality

In the last couple of years, Robo-advisor investment platforms have taken an important position in serving the middle and lower markets for financial planning. They are here to stay and should be encouraged. The question is does the Robo model for investments in its current format completely work? Like many new innovations, the problems are somewhat hidden when the markets are hidden. Where the Robo platform is completely stand-alone and totally independent of direct advisor input then the risks increase.

Then, also let’s consider what do investors want? Gallup research shows only 9% of investors want a completely automated service, and this is mainly the younger investor. Therefore, 91% of investors want some human input in their financial planning. Refer to the following research:
http://financialadvisoriq.com/c/1148733/123753/investors_want_both_humans_robo_advisors?referrer_module=emailMorningNews

The issue I see emerging for Robo platforms is that when there is a sharp and/or sustained correction downwards then there could be a mass exodus with a bloodbath of losses. After all, behavioral finance research shows us, people will, in varying degrees, make emotional decisions at the wrong time and follow the herd out of the market. Yes, the Robo platform may have many clients, but they will not be able to communicate with them when negative events happen. Similarly, there is no incentive for the Robo platform to communicate with investors as the market keeps going up and many get out of their comfort zone. In fact, the Robo is incentivized to keep having these people sign-up.

Overall, the structural problem for Robo platforms, as they currently stand, is that they do not know enough of the in-depth financial personality of the investor. The investor is served in a “one-size fits all” way based on a set of algorithms which have no relationship to who they are. The downsides are the Robo Platform does not know:

  1. How to communicate with each investor on their unique terms. Put another way, they do not know how to re-frame information so that it is understandable to the investor.
  2. The behavioral biases of each investor which will drive their decision-making (for instance to name a few, loss aversion, following the herd, taking a consolidated view, over trading).
  3. The correct risk profile which will influence portfolio allocation. Some of the Robo’s have a few questions that relate to risk and others make potentially false assumptions based on demographic data. Not all Millennial’s and Gen Y’s with a high income are risk-takers.

The Robo platform would be greatly strengthened if it had a validated financial personality discovery process incorporated into it. The ROI would be significant in the following areas:

  1. The ability to customize communications from the first point of engagement in the sign-up process. This would not help the initial sign-up process but also ongoing marketing.
  2. Enhance the capability to manage investor emotions in volatile markets.
  3. Provide a more robust framework for making suitable recommendations to meet compliance requirements and also monitor them.

Ultimately, a Robo investment platform will not be sustainable on a long-term basis if there are no mechanisms to “Know, Engage, and Grow” the investor clients. This means that there must be robust online solutions to discover the client’s financial personality and a place for human interaction. These elements can be incorporated on a cost-effective basis and to achieve scalability which is needed to bring financial planning to the masses in a safer way.

Managing Difficult Conversation During In the Workplace

Managing Difficult Conversation During In the Workplace

Alex leads a team of strategists and planners working to mitigate any issues that might arise as a result of policies to be introduced into a highly successful international manufacturing company.

The team is made up of great minds, thinkers, strategists, statisticians, all highly regarded in their field. The team tests every scenario to ensure that new products or services introduced meet client needs, do not compromise existing services or products and conform to any regulatory requirements worldwide.

 

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Alex is preparing to have a difficult conversation with Jay one of the top strategists whose behavior has become difficult to manage. Alex is structured, formal; not big on conflict and realizes he has allowed Jays authoritativeness, self-reliance and frankness to cause issues throughout the team and distract them during a particularly pressurized time.

Alex realizes that he has avoided talking to Jay whose behavior is now creating problems; he doesn’t want to have this difficult conversation but is aware that the team are talking about Jay and not talking to him concerning the impact his behavior is having on them. Jay is one of Alex most gifted strategists; his ability to make quick yet informed decisions makes him very valuable to the team.

A side issue that concerns Alex is realizing the team is dismissing input from Jay for no reason other than frustration about his ongoing behavior.

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The issue came to a head when one of Alex key team members offers their resignation citing Jay as the cause, adding that Jay was taking charge of every aspect of their work; was dismissive of input and responding harshly to attempts to challenge not only his input but also his communication style.

Alex prepares for the meeting with Jay; making sure that the meeting format is well set out in his head. He knows the outcome he wants; he doesn’t want to lose Jay nor any other staff member. But he also does not like conflict and tends to close down and retreat when people are blunt.

From the outset Jay appears defensive; Alex begins by acknowledging that there will be differences in how each person communicates and sees things. Differing perspectives is what makes the team great. He goes on to acknowledge successes, not just Jays but the team as a whole. Alex explains to Jay the impact of his current behavior, making sure to frame it in the behavior he, Alex, has observed and not in the he said, she said’.

Immediately Alex can see the confusion on Jays face. He asks Jay for his response to which Jay replies he had no idea his communication style was affecting and impacting his colleagues or Alex in this way.?He states that causing issues such as this was never his intention. He further states that he had indeed become frustrated and harsh in some of his responses simply because he viewed the current project they were working on so important and didn’t feel the others realized the implications to the business of getting their findings wrong, but his responses were never intended to be personal only ever about work.

Jay began to realize the implications of what Alex was saying; he could now see why the work atmosphere had become so negative towards him; why his suggestions and even concerns were being rejected.

Seeing Jay response, Alex immediately moves the conversation onto finding a structured solution.

The reality of the situation is that Jay, Alex and the team were operating from their natural zone, and they did not have the awareness to adapt. Alex realized that the solution lay in getting the whole team to complete the Communication DNA Discovery Process. Alex had completed this himself as part of a DNA Behavior International conference he attended. Alex realized that if Jay and the team completed this process and share the outcomes, they would have an insight into their communication and behavioral inherent styles. Alex puts this suggestion to Jay who quickly agrees.

The team complete the Communication DNA Discovery Process and along with Alex share the outcomes with each other.

  1. No long stories, keep to the point
  2. Keep meeting agenda short and focused
  3. Prioritize objectives around their goals
  4. Start with the big picture, not too much detail on one part of it
  5. Lay out the options so a decision can be made
  6. Provide bullet points
  7. Clearly outline risk/reward from best and worst case scenario
  8. Ask for their thoughts on recommendations
  9. Ask how involved they want you in the planning process
  10. Recognize them with referrals to other influencers

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With this knowledge, Alex and the team would have discovered that Jay communication style was not intended to be personal. Any harshness stemmed from his frustration to keep the work on track. The team members realized as they shared that Jay would not have taken offense had they pointed out his harshness and asked him to identify the source of it. Jay would have realized from reactions that his behavior was causing his colleagues to pull away from him, reject his input and he should have asked why.

Avoiding difficult conversations at work can grow to become a major barrier and obstacle to excellent performance. In this case, if everyone understood communication and behavioral styles it would not have escalated so far. However, insight into inherent communication and behavioral styles quickly put this team back on track.

 

Are your couple clients at risk of leaving your Financial Advisory Firm-

Are Your Couple Clients at Risk of Leaving Your Financial Advisory Firm?

Statistics shows that 70% of couple clients are at risk of leaving their Financial Advisor if one of the spouses divorces or dies. What is driving this high statistic is that a Financial Advisor typically connects with one spouse more naturally than the other. The other spouse doesn’t feel they have been heard in the meetings or engaged in a process of building the annual plan.

As an Advisor, ask yourself the questions below to see if you are at risk of losing a client:

1. Are your communications actively addressing each person’s communication style or do you tend to focus on just one person?

2. Do you understand the different needs of each person to make decisions and seek agreement from both individuals when there is a key decision to be made?

3. Do you ask both partners how they feel or think about the meeting and how you can structure future meetings in a manner that is more effective? OR, if they want to focus more on the financial plan.

4. Do you understand the different behavioral biases and risk tolerance of each individual that would affect how you construct a portfolio?

DNA Behavior provides Financial and Communication DNA solutions to help Advisors understand clients’ behavioral biases and retain clients by learning how to apply this understanding when interacting with clients and managing their portfolios.

Financial DNA helps Advisors increase confidence that they can engage their couple clients on their terms with objective data. This important data can ensure the Advisor is framing questions to ensure financial compatibility and improve financially and life decisions.

For more examples of how Financial DNA is being used, click here.

Are Your Couple Clients at Risk of Leaving Your Financial Advisory Firm 2

Managing Difficult Project Delivery Conversations 2

Managing Difficult Project Delivery Conversations

Tom, who is the leader of a large technology solutions company, recently attended a 1-day leadership training workshop to learn more about how to effectively manage and coach teams. One of the aspects he learned was that engaging in difficult conversations is a critical part of a leader’s role. A key takeaway was that you cannot withdraw to get away from the possible conflict and then later re-appear to hold a team member accountable in a domineering way. With this leadership insight, Tom realized that learning to manage difficult conversations is critical to the preservation of relationships. Failing to understand the impact of communication on another person can lead to a relationship breakdown that undermines confidence, discourages employees and potentially destabilizes the business.

4 Primary Communication Style Graph

By nature, Tom is driven to reach goals, very competitive, confident and, in exercising initiative, makes things happen. Tom is currently under pressure as the delivery of a complicated and high-earning technology solution for a bank is running behind schedule. Tom naturally communicates very directly. He gets to the bottom line and is not interested in lengthy explanations or stories.

Josh heads up the project. He is analytical, very specific in his approach to business, won’t be rushed, and reacts when insufficient time is allocated to complete work. He recognizes that the timeline for the project is slipping but believes checking and re-checking ensure the outcome is successful and there will be little need to rework the technical solution for the client. Josh communicates using detail, examples and specifics to support a conversation.

Tom opens the conversation with “can you tell me why is the project slipping?” To which Josh responds, “we need more time, I want to be sure before sign off.” Josh continued outlining every aspect he was checking at which point Tom issued a directive: “sign the project off by close of business today.”

Under pressure, Tom failed to listen to the detail Josh was providing. Josh failed to see that Tom was under pressure and needed headlines, bullet points, and a range of sign-off options Tom could take to the client. The meeting ended acrimoniously.

 Lifestyle Communication DNA Style

Had Tom, as the leader, given Josh his time and attention to listen to the detail of where the project sat, he would have been able to provide Josh with suggestions on issues or priorities to help him effectively achieve a plan for a sign-off. Instead, Josh felt overwhelmed and rather than moving the project forward continued to focus on reviewing each issue/step of the project under the original brief believing that Tom was criticising his work.

The reality of the situation is that both Tom and Josh were operating from their natural behavior and they did not have the awareness to adapt. Then Tom remembered during the recent leadership training he had completed the Communication DNA Discovery Process which identified his direct goal-setting, communication style. He realized that if before the conversation, or even at the start of the project, that Josh had also completed his Communication DNA then the result of the difficult conversation could have been different. He would have seen the benefits of giving Josh space to present his position whilst steering him to the bottom line and thereby a solution. He could have demonstrated to Josh that any risk to the project was minimized and offered Josh assurances that he trusted him. Tom would have uncovered Josh’s natural ability to absorb and analyse information ‘on the run’ and offer strategies to move the project to closure.