This article first appeared in Nasdaq.
Where does Behavioral Science fit in business? This is a question I am increasingly asked by financial leaders.
They can see how behavioral science, nudging and behavioral economics have become significant topics, yet cannot always see the “fit.” More importantly, they want to better understand the advantages. (And, no doubt, the investment.)
Simple answer? If understanding human behavior is foundational to your business, you’ll greatly benefit from BeSci. The type of industry you lead is less important than the business need to understand your people and customers.
Insight as an edge
I get to see firsthand how the application of behavioral science data in any business has profoundly changed the way leaders, advisors, policy makers and practitioners increase productivity. And market share.
One such area of business is financial advice (natch). When advisors have tools at their fingertips to deliver validated insight into the client behavior experience, they are able to intervene to steer clients away from poor life decisions in this time of pandemic-nervous market volatility.
The financial industry still has much to do to satisfy Know-Your-Client regulations and provide a quality customer experience. Those goals are even more challenging during this market. But behavioral insights enable financial advisors to manage investor behaviors remotely.
The entire advisor-client experience has shifted in ways unimaginable a few months ago: No face-to-face meetings, relying on social media platforms, clients and advisors stressed, and behaviors surfacing that lead to bad (financial) decisions.
Consider that advisors who previously invested in BeSci solutions are not only managing through these tough times; many are building their business, as the leverage chaos into opportunities. Especially in challenging times, advisors find themselves major client influencers. More coach than just advisor. That’s only possible when advisors understand clients’ financial personalities.
Learning from the past
The financial crisis of 2008 heightened the awareness that rational behavior was not a realistic assumption to make in times of market crisis. Wise advisors recognize that, without a depth of insight into client behaviors, they cannot hope to keep clients on track.
Behavioral science has burgeoned since 2008. It’s relatively simple – employ a quality data gathering behavioral tool to understand clients. It’s also not expensive and the results far outweigh the investment. And the productivity and success pendulum quickly swings upward upon implementation.
Power your platform with BeSci
Remembering that each is 100% unique and delivering the corresponding customized service is nearly impossible, even if your advisory practice is relatively small. There is no one-size-fits-all approach that will work across the board.
But if you can find a behavioral science tool that is enable by an application programming interface (API), it allows you to leverage in BeSci to existing systems, platforms and methods, so you are improving your proverbial wheels, not reinventing them.
A proven behavioral science API enables your team to quickly integrate to humanize your platforms with rich, scientifically validated, personality driven insights to add a human touch to your digital solution giving access to hundreds of behavioral insights.
Whether you are looking to match clients to advisors, customize and personalize an experience or ensure a good fit for a team or role, access to this level of behavioral insight can help you succeed. Leverage and customize the experience across entire organizations from client-facing engagements, marketing, planning and investing and compliance.
Clients will feel, see the difference
Putting behavioral science knowledge to use demonstrates to clients that the advisor is keenly interested in their unique wants, needs, goals and challenges. In this way, BeSci has the follow-on benefit of signaling that the advisor values and invests in long-term client relationships – and the robust outcomes that follow.