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Having Confidence (#115)

(Podcast audio link at the end of the post)

About four years ago, I attended a fascinating presentation given by Peter Atwater to a group of CEOs.

Peter, a renowned expert on confidence, studies how changes in confidence affect our inclinations, decisions and actions. He looks at things like books, music, architecture and food preferences when researching social, political, financial and business mood.

A few days prior to Peter’s presentation, the house majority leader at the time, Eric Cantor, was defeated in one of the most stunning primary election upsets in congressional history. Peter addressed this election loss in his presentation, observing that it served as another data point showing historically low confidence levels on main street versus Wall Street.

He observed that other politicians who failed to give their primary focus and attention on their own “backyard” would be in trouble over the next few years. The same went for companies who weren’t paying attention to the shift in consumers’ moods or aligning with demand.

Fast forward to today and much of what Peter shared with that group has come true.

Confidence, he said, is a cognitive state of being.

It turns out that when we feel confident, our horizons and timelines expand. We have a more optimistic, global, big picture viewpoint and believe that the future will be better than the present. This has a strong effect on our decision making and timelines, often resulting in us making big bets on future-focused things.

As an example, Peter has uncovered connections between people’s general optimism and architecture. He found that these times of high confidence were when great castles, college buildings and sports stadiums were built, often right before or at peak confidence levels. Look around at today’s technology sector and you will find that almost every major player is building a massive new headquarters.

On the flip side, when we don’t feel confident, our horizon window narrows dramatically; we’re much more focused on the present and what’s right in front of us, not the future. We see things as riskier and concentrate on preservation, not growth or future-focused investments. We want tangible problems solved now, not large problems in the future. In Peter’s terms, we’re about the “me here and now.”

We see this phenomenon today in the “buy local” movement and the preference for political candidates who focus on issues “at home.”

An example that tapped into this sentiment is Keurig® K-Cup® Pods. This product has seen explosive growth due to its convenience and speed, much to the dismay of the inventor who regrets the long-term ecological disaster that his invention has become.

At different times in our life, our confidence levels go through peaks and troughs. To make better decisions, we need to be aware of how our mindset effects our decision making and understand whether we are at low point of confidence or a peak. Both extremes can get us into trouble.

If you can’t see the embedded player above, you can listen to it on iTunes or Stitcher.

Check out my interview with Peter on our Outperform podcast to learn more about his work and his projections around what political candidates, financial markets, products and business models will be successful in our current environment and upcoming years.

Quote of the Week

“Successful people have fear, successful people have doubts, and successful people have worries. They just don’t let these feelings stop them.”

 T. Harv Eker

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Game Face (#108)

“There is no way the kicker is making that field goal.”

I made this bold proclamation to a table full of colleagues as we watched the recent College Football Championship game between Alabama and Georgia.

Alabama was in the middle of staging a comeback that would set them up for a game-winning field goal. Their kicker, Andy Pappanastos, had badly missed a 40-yard field goal and barely made a 30-yard one early in the game.  (For non-US readers, that distance is usually considered quite achievable).

Now, here he was, with a chance at redemption. A relatively short field goal would give Alabama the national championship in a dramatic comeback. He should have been pumped.

As Alabama marched down the field, the TV crew kept panning to the sideline where Pappanastos was doing his warm ups for the kick. What you usually see is a kicker with his head down, focused, with his game face on; perhaps visualizing being the hero for his team.

What I saw in the look of Pappanastos’ face however, was fear, panic and the look of “I’d rather be anywhere than here.” He looked like he wanted to throw up.

After Alabama was unable to score a touchdown, Pappanastos trotted onto the field to attempt the 36-yard field goal for the win. Neither the color in his face or his expression improved. He looked visibly uncomfortable, thus leading me to repeat my prediction to the table.

And I was right.

Seconds later, he kicked. The ball went way left of the goal post, sending the game to overtime. It was what we refer to as a “shank,” very far off; a mishit.

Fortunately for Pappanastos, his teammates bailed him out in overtime with a dramatic 60-yard pass, which was, ironically, thrown by an upbeat and confident Freshman quarterback playing in his very first game.

There are a few key lessons that can be gleaned from this story.

1. Brain/Body Connection. It’s really hard to get your body to do something well if you mind doesn’t want to do it. We all know the difference in the look of defeat on someone’s face versus the look of hope and optimism.

2. Confidence & Projection. How we project ourselves to others matters. Studies conducted by Dr. Albert Mehrabian reveal that 7% of any message is conveyed through words, 38% through vocal elements (tone, timber, pitch, etc.) and 55% through nonverbal elements (facial expressions, gestures, posture, etc.). For example, if I am telling you I want your feedback on a project, but am scowling at you with crossed arms, that’s not the message you get.

The implication is that, when you have a big challenge or opportunity to tackle, your mental preparation combined with awareness of your body language, has a big impact both on your performance and how you will be perceived by others. Those two are also likely to be connected.

Even if you don’t make the metaphorical field goal, it’s better for others to perceive that you had every intention of doing so. That, combined with a high level of confidence, should improve your chances of success.

Quote of the Week

“Pretend to be in complete control and people will assume you are.”

Walter Isaacson

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Confidence and Client Engagement: Keys to Advisor Success

This week I attended the Financial Behavior in Retirement Summit in Chicago and presented “Really Knowing Who Your Clients Are”. The presentation guides advisors to understand the importance of knowing the natural behavior of clients and uncovering their life and financial motivations in order to tailor services to them.

By customizing their services, advisors will gain confidence and engage clients. In the planning process, helping clients understand who they really are can improve their financial results.

Financial Planning Magazine has published an article highlighting the?presentation. To read the article on the Financial Planning Magazine website, click here: “Confidence and Client Engagement: Keys to Advisor Success“.

Visit the DNA Behavior for Financial Services website to learn more about our solutions for emotionally engaging your clients.

Email us for additional information.

Self Esteem Impacts Financial Performance

One of my strong beliefs is that confidence sustains your performance. If you lose your confidence this will have a negative impact on your financial decision-making, and all other decision-making. The reality is that when your confidence goes down then you can become pressured to make poor decisions. Your emotions will be higher and rationality reduced.? It is then harder to stay with a financial plan when you have lost your confidence. You become reactionary to events rather than being committed to your decisions, which comes from confidence.

Now there is research which shows a direct relationship between having high self esteem and a good relationship to money.? Please review the Aviva Feel-Good Insight Report prepared in June 2010.? This is a study into financial well being. Click here to review.

One of the key research insights is that 85% of people who are in control of the finances have high self-esteem. Further, they are likelier to feel happier about their financial situation. Self esteem can be improved by sensible financial behavior, improved understanding and the right advice. 62% of people with high self esteem have set financial goals and save to invest in them. 72% of those with low self esteem lack any savings or investing habits for the long term.

So, what are you doing to build your confidence? What are you doing to ensure your self esteem does not get eroded?

In the end, it is practicing smart behaviors.? Take a look at our DNA Performance Model to learn more – click here.

Confidence Sustains Performance

In all areas of life, people talk about how they can improve and sustain performance. How do we get better results and keep good results regularly coming? This is true for people in their personal lives and careers, businesses, sporting teams and so on.

Foundational to building performance to a high level is knowing your DNA Behavioral style, openly communicating with others and then keeping to a purpose based plan. This is the core DNA Performance Model.

However, the key to sustaining performance is “confidence”. Building performance and starting a “winning streak” is one thing but keeping it going is another. Have you noticed how some people get it together early in their life or career and then lose it later seemingly going into a downward spiral. Some then come back, some do not. Others start slow and then get in the groove and grow. This is also true of businesses and also sporting teams. When you take a look into all of these situations of fluctuating performance the common element is confidence.

When confidence is increasing and is high it can propel you forward further to achieve even better results. However, competency and arrogance can creep in with a failure to remember what got you there. Then a bad event comes or someone does something great out of the blue and you do not know what to do. This can be the start of a loss of confidence, which can build up. At the same time, for another person who has been on a losing streak they string together some wins and successes. Suddenly, they start the climb upwards.

I would encourage all of you to think about what makes you confident and what makes you lose confidence. If you like, we can help you with looking at your confidence attributes.

I would also encourage you to read the book “Confidence” by Rosabeth Moss Kanter. This book uses plenty of great personal, business and sporting stories to show how winning streaks and losing streaks begin and end.