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Clients Want Behaviorally Smart Advisors

Why should an advisor become behaviorally smart?

  1. Prospects and clients are looking for it.
  2. 93.6% of financial planning is the behavioral management of the client.

Recent research reveals:

  1. Pre-retirees say an advisor whom I trust and who really gets me would have the most positive impact on their financial outlook.
  2. Nearly half of the men and women surveyed do not feel they have enough financial knowledge to feel confident about making investment decisions.

You need to get your clients and you need to educate them in a way that makes most sense to their own unique financial personality.

The need to objectively uncover natural instinctive behavior is crucial in the financial planning process because this is how clients:

  • More comfortably make decisions
  • Operate under stress
  • Create a framework for life and financial perspectives

Understanding people before numbers is more important than ever.? Your client relationships depend on behavioral awareness.? Its a trend that never really went out of style.



Peggy Mengel ? Vice President, Human Behavior Solutions Advisor at DNA Behavior

Specializing in financial services, Peggy uses behavioral intelligence to help businesses navigate human differences to unlock performance potential. DNA Behavior helps grow behaviorally smart businesses and financial advisors worldwide to increase competitive advantage using the most reliable behavioral discovery and performance development systems on cutting-edge technology platforms.

Visit the Financial DNA website to learn more about building client engagement in the financial planning process.

Why should an advisor become behaviorally smart?

1. Prospects and clients are looking for it.

2. 93.6% of financial planning is the behavioral management of the client.

Recent research http://www.fa-mag.com/news/a-trusted-advisor-leads-to-positive-financial-outlook–survey-finds-15957.html?section=131 reveals:

1. Pre-retirees say an advisor whom I trust and who really gets me would have the most positive impact on their financial outlook.

2. Nearly half of the men and women surveyed do not feel they have enough financial knowledge to feel confident about making investment decisions.

You need to get your clients and you need to educate them in a way that makes most sense to their own unique financial personality.

The need to objectively uncover natural instinctive behavior is crucial in the financial planning process because this is how clients:

? More comfortably make decisions

? Operate under stress

? Create a framework for life and financial perspectives

Understanding people before numbers is more important than ever. Your client relationships depend on behavioral awareness. Its a trend that never really went out of style.

Where is the Real Value of the Advice Advisors are Giving?

Building a relationship is the basic requirement that enables a trusted exchange of information to take place. Such a trusted relationship becomes even more critical when the information to be shared touches sensitive or personal areas of the lives we lead. Personal finance is historically one of the top no go areas for dinner table conversation. Although, there are people who will always tell you snippets of what they want you to know.? And yet how often do clients openly share details of their financial position with financial advisers just because they are financial advisers?

Real Value of AdviceVery often the client will share the financial basics because that is easy but not the deeper life issues. In reality these life issues are driving the real financial concerns and questions they have. It is these deeper issues that need to be discovered ? the information is hard for advisors to discover and hard for clients to tell you about.

Here are a few thoughts of what advisors really need to know and what clients need to feel safe in talking about:

  1. What do you know about the clients bucket list -? the things they want to do before being too old to do them?
  2. What do you know about past mistakes the client has made because of poor financial decisions?
  3. What do you know about the clients family financial history?
  4. What do you know about the clients decision making style; do you know to what degree its driven by instinctive behavior,? emotions, knowledge, peer pressure or something else?

Risk profiling that is singularly directed towards investments wont answer these important questions. However, a behaviorally smart adviser who seeks to holistically understand the clients complete financial personality would be far ahead of the traditional advisor or investment manager. Advisers should position themselves to be selected by clients who want them to recognize and navigate their different behavioral styles and emotions. If advisers really want to build relationships and therefore their business they need to realize that independent research shows 93.6% of their role is managing client behaviors.

Tony Vidler in his article Why Sales Skills Matter More Than Ever comments on the findings of the July 2013 report titled Econometric Models on the Value of Advice of a Financial Advisor, by Claude Montmarquette and Nathalie Viennot-Briot:

...clearly there is a fundamental requirement for the professional to have strong technical competency
in order to be able to use sales skills effectively and ethically ? the adviser has to know why a particular
course of action is sensible before attempting to convince clients to take it! But apparently, the real
value advisers create comes from getting clients to change directions or habits. That requires the
strongest skills imaginable.

The face of financial advice is changing. The financial industry is asking questions about where the next opportunities are; how are advisers going to generate business, etc.. All valid concerns and all easily answered; financial advisers need to become more behaviorally smart, they need to be open to different right brained approaches if they want the best possible outcome for clients.

Now is a watershed moment in the world of financial advice. With the advent of tighter regulatory requirements, competition and the ever changing economic landscape,? the real response to these environments is to focus on knowing who your clients are and building strong, effective and long lasting relationships with them.? They in turn will become ambassadors by placing value on and talking about the client centered approach you have to providing them with advice.



Carol Pocklington is a Human Behavior Solutions Analyst at DNA Behavior, assisting with the research and development of behavioral products. DNA Behavior helps grow behaviorally smart businesses and financial advisors worldwide to increase competitive advantage using the most reliable behavioral discovery and performance development systems on cutting-edge technology platforms. Solutions are delivered in the areas of client experience management, financial personality management and human capital management.

Visit the Financial DNA website to learn more about building the relationship with your clients in the financial planning process.

Behaviorally Smart Advisors Engage Clients for Life

How engaging are your client experiences?

Your answer might depend on how you define the word engaging.

Customer engagement is the repeated and satisfying interactions that strengthen the emotional connection your client has with your firm.

client engagement, behavioral financeYou might be thinking that every financial plan you create has an emotional connection. After all, you are dealing with emotional issues such as retirement, selling a firm, financing college educations, and even death of a spouse.

And the emotional connection needs to starts at the very first meeting. A quick question to ask yourself is, Do your personalities match or clash?

Its the answer to the does he or she really get me? question that goes on in the mind of the client.

Lets look at 4 different styles of clients and how they may determine the answer to that question.

  1. Goal Setting: Did the advisor quickly move towards identifying my goals?
  2. Lifestyle: Was the advisor fun and optimistic? Did the advisor let me do most of the talking?
  3. Information: Did the advisor answer all of my questions thoroughly and give me time to think?
  4. Stability: Did the advisor seem truly concerned and interested in my family? ?Was the pace of the meeting relaxed?

When you consider that 93.6% of the financial planning process is behavioral management of the client, you might pause to consider,? how much of the client do you really want to manage?? If they are opposite you in personality, you will be managing a lot!

Make a conscious and strategic decision to uncover the complete personality of the client in your onboarding process.? You will find that it becomes a key success factor in creating truly engaging client experiences.



Peggy Mengel – Vice President, Human Behavior Solutions Advisor at DNA Behavior

Specializing in financial services, Peggy uses behavioral intelligence to help businesses navigate human differences to unlock performance potential. DNA Behavior helps grow behaviorally smart businesses and financial advisors worldwide to increase competitive advantage using the most reliable behavioral discovery and performance development systems on cutting-edge technology platforms.

Visit the Financial DNA website to learn more about building client engagement in the financial planning process.

3 Ways to Prepare for the Behavioral Awareness Movement

More financial services firms are starting to join the behavioral awareness movement.? Why?

Behavioral theories now have proven hard-edged results. By engaging clients on their terms, financial services firms can increase revenues and manage their compliance risks.

behavioral finance, behavioral awarenessWhat can you DO to help your advisors become behaviorally smart?

1. Give your advisors bigger behavioral data

93.6% of financial planning is behavioral management of the client. As described in What Drives Your Financial Decisions, an advisor needs to know deeper traits of the client such as personality style, emotions, listening style, communication preferences, confidence level and desire to control.? And, this behavioral data needs to be at the fingertips (via CRM) of the advisor and their staff.

2. Provide a client engagement solution for your advisors

In a recent survey by Practical Perspectives, one of the top topics of interest to advisors is client development and engagement.? Advisors are not interested only in theory.? What they really want is a program that is actionable and implementation-oriented.

3. Lead by example with your advisors

Does every employee that interacts with your clients know their communication preferences and behavioral style?? Research shows a 40% decrease in repeat calls when a call center rep tailored their response to match the unique personality of the caller (client).

Isnt it time to recognize individual differences and become behaviorally smart?

Discover the action steps to take now at www.financialdna.com.

How it Works, DNA Behavior, behavioral consulting, psychometric testing

Uncovering the Advisory Blind Spot

Dictionary meaning: blind spot a subject that you do not understand well, often because you do not want to know or admit the truth about it.

Most clients have a blind spot when it comes to financial management; but equally most advisors have a blind spot about who their clients are. The advisor often believes he or she can read people but it is natural the advisor will not be able to get a complete and objective understanding of the client regardless of their intuition or level of experience. Uncovering these blind spots has two powerful outcomes in the financial advisory process.

Advisory Blind Spots, Behavioral Finance, Financial PersonalityFirstly, for an advisor it increases their understanding of the importance of asking clients the right questions. Getting to know how clients are financially wired is a key to building relationships. Secondly, it uncovers the need for advisors to acquire skills that assist them to understand different client communication styles and how to use that knowledge to moderate/adjust communication styles to draw out information about clients financial behavior and decision making patterns, and from there adapt advice to better meet their needs.

The challenge for clients is that they dont know what they dont know and this leads to blind spots. They may well not be able to see opportunities in risk nor risk in opportunities, and advisors need to be able to expose these blind spots and the possible history behind them. Being able to discover their future plans, their aspirations, their background and what has driven or influenced where they want to go in terms of wealth management ensures that advisors give targeted advice that will undoubtedly build stronger client/advisor relationships.

Sarah and Michael recently engaged to be married decided to speak to a financial advisor about planning their financial future. The advisor encouraged them to save and invest; to work towards owning their own property and gave them reading material to support the advice.

Sarah and Michael left confused and dissatisfied. They had wanted to talk about handling money responsibly; they wanted to ask questions about separate or joint accounts; they wanted to start a college fund for the future education of their hoped for children; they wanted to avoid debt but use and manage credit sensibly; they wanted to ask about a self-managed pension scheme; they wanted to share their dreams for the future and how they could build wealth to enable them to realize them.

Did the advisor give advice? Yes. Did the advisor uncover anything significant about these two potential clients? No. Had time been invested into asking questions, discovering their financial personality style uncovering their history, revealing any blind spots ? the advisor would have discovered that Sarahs parents divorced after mismanagement of finances that led to bankruptcy and she was determined that this should not happen to her but knew she had many concerns about never taking any risk with finances. Michael came from a long line of financially astute family members. As a family they openly discussed finances and understood the importance of encouraging the younger members to do likewise.? Michaels family through careful management had built up a significant wealth.

http://www.communicationdna.com/newsite/wp-content/uploads/2012/04/cdna-solutions-slide-enterprise1-130x60.pngHad the advisor been behaviorally smart; had they objectively known the different behavioral styles and emotions of these clients which comes from using a formal behavioural discovery process; had the advisor been equipped to navigate human differences by discovering and aligning how to uncover different communication styles, behaviors, solution preferences and blind spots this story would have had a happier ending. As it was Sarah and Michael took their business elsewhere.

To learn more about uncovering the advisory blind spot, please visit the Financial DNA website.


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What Do Clients Want From Their Advisor?

Often we think that clients want higher investment returns from their advisor, and therefore that defines the role of the advisor. However, research shows that clients want a relationship. This has actually been the case for a long time but the research is becoming clearly stronger all over the world in the need for advisors to develop stronger interpersonal skills and emotional intelligence.

What Clients Want from AdvisorsRecent Trusted Advisor Research by Professional Planner magazine in Australia demonstrates that an advisors interpersonal skills and emotional intelligence are most important by 82% of the survey participants who were clients of Advisors of the Year.

Refer to the full article at: http://www.professionalplanner.com.au/research/afa-study-shows-eq-pays

There is no doubt developing your interpersonal skills grows the bottom line. In advisory business relationships are the key to revenue sustainability.

Many advisors are naturally results orientated in behavioral style and therefore naturally lower on relationships. But, the interpersonal skills can be learned with sustained effort, focus and investment. The starting point is behavioral awareness.

So, the question becomes why isnt there more sustained investment in developing the interpersonal skills and EQ of advisors? It seems there is still a strong over weighting towards technical training. When we see this change, trust in the industry will grow.

Our firm has recently been working with Advisors Ahead to deliver this type of training to financial planning students and young advisors. This is an important starting point but needs to go much further.

To learn more about how you can grow to become a behaviorally smart advisor, please visit the Financial DNA website.