Coaching Clients Through Dark and Gloom

Been reading the headlines lately? Bleak stuff, isn’t it?

Regardless of one’s political stripe or economic belief, the news has been difficult to stomach of late. Each new day seems to bring a different outrage or unspeakable horror.

Sadly, with the dysfunction in Washington, D.C., it’s possible that it gets worse before it gets better.

For financial advisors who’ve been in the business for any length of time, it might seem like déjà vu all over again. It was just three years ago that the financial debacle seriously corroded the trust that investors had in: the financial markets, the regulators, investment firms, and their advisors. Only just recently has this trust and confidence been regained, if at all. Indeed, the World Wealth Report 2011 indicates that only 44% of high-net-worth investors have any faith in the oversight regulators today, and 33% actively distrust these institutions.

If you are a financial advisor, I’m assuming that many of your clients are freaked out by the headlines too. Personally, I don’t think it would take much to scare the living daylights out of many investors…to the point where they crawl back into the cave that they just emerged from…and push the rock back over the entrance.

Here’s the thing though. We have observed that times of “investor stress” are really interesting periods for financial advisors to engage their clients in highly-personal and honest discussions about what concerns them most, e.g. their fears and concerns about money, their legacy and future, family, their values, etc.

If you’d like to engage your clients differently this time, here’s a thought. Act like a coach. Although the best coaches out there undergo years of coaching, learning, and thinking before they reach top proficiency, I would refer you to the 11 Core Competencies as outlined by the International Coach Federation (ICF). These core competencies are the foundational elements that buttress the special relationship that coaches create with their clients. Although not all of these competencies are equally germane to the financial advisor-client relationship, many have a high degree of relevance.

For example:

• An essential core competency of the ICF-credentialed coach is the ability to co-create a trusting (and intimate) relationship with the client by building a safe supportive environment that produces ongoing mutual respect and trust.

• Another core competency is active listening… which is the ability to focus completely on what the client is saying (and is not saying), in order to understand the meaning of what is said in the context of the client’s desires, and to support client self-expression.

• Still another is powerful questioning…which is the skill of asking open-ended questions that evoke discovery, insight, commitment, or action (including those questions that challenge the client’s assumptions.)

Finally, if you are really interested in becoming more coach-like in how you interact and partner with your clients…get a coach. There is no better way to model coaching behavior than to observe close-at-hand the practiced mastery of a highly-skilled coach.

For those financial advisors who’ve seen this movie before…what’s your learning from the last time? What would you do differently?

Remembering the oft-misquoted words of the philosopher George Santayana (1863-1952): "Those who cannot remember the past are condemned to repeat it."

If that quote doesn’t grab you, try this one: “I’ve lived through some terrible things in my life…some of which actually happened.” …Mark Twain (or maybe not)

by Chris Holman

Survey Says!

Marketers have long known that Client Surveys are a good thing. They are an effective tool that positively influences customers and clients.

In a seminal study by Paul Dholakia and Dr. Vicki Morwitz, published in Harvard Business Review, 1000 customers of a large financial services company were tracked for one year…following a simple 10-minute customer survey that was conducted over the telephone.

Here’s what Dholakia and Morwitz found:

• Survey participants were 3x as likely to open new accounts with the firm,
• Survey participants were less than half as likely to defect,
• Survey participants had a significantly higher profitability profile as compared to the control group, and
• Moreover, Professors Horwitz and Dholakia believe that the positive spillover of the client survey last anywhere from 3-8 years.
  

Unfortunately, there is some evidence that not all financial advisors have not yet embraced client surveys and the positive impact they have on client profitability and loyalty. Recently, our firm, ClientWise, polled a large group of top-performing financial advisors…and discovered that only 20% were surveying their clients on a consistent basis.

This is a missed opportunity. In fact, we think that individual financial advisors can implement a very personalized client survey that is even more effective than the previously discussed results of Horwitz and Dholakia. We call this the “ClientWise Conversation” …a series of 5 straightforward and thoughtful questions that get to the heart of the client-advisor relationship.

Recently, one of our coaches reported on the learning that one of his clients gained through a ClientWise Conversation with his top clients.

Among other findings, the financial advisor discovered:

1. That several of his clients were concerned that he wasn’t on a team, and (without knowing his succession plan) wondered what might happen if he left the business unexpectedly,
2. A surprisingly large number of the advisor’s clients asked why they hadn’t been approached for referrals. (Because they hadn’t been asked, they had assumed that the advisor wasn’t looking to build his business.)
3. Some retiree clients were concerned about the account fees, while noting that the accounts did not have much trading activity. In their minds, they had been asking themselves, “Where is the value?”
4. Yet, most all of the clients felt great about the overall relationship, and were delighted that their financial advisors cared enough to ask them how things were going.

Without engaging his clients in the deeper discussion that we call the "ClientWise Conversation", this advisor would have been oblivious to these important issues; some of which were putting his clients "at-risk", and others being obvious opportunities to grow.

by Chris Holman

Mark Zuckerberg Turns It On

For having the reputation of a “27-year-old multi-billionaire geeky tech guy”, Mark Zuckerberg also seems to have a high degree of emotional intelligence and self-awareness, and can turn on the charm when he needs to.

Pretty fascinating article in yesterday’s NY Times entitled, “Taking a Walk with Mark Zuckerberg”. It describes the process, experienced by a select few “rockstar” recruits to Facebook.

Sometime during the recruitment courtship, Zuckerberg surprises the candidate with an invitation to join him on a walk. (How does one say “No” to this?) At this point, Zuckerberg escorts his somewhat startled guest across the parking lot at Facebook headquarters (see picture) on 1601 S. California Ave. in Palo Alto CA, where they amble along a wooded trail until they reach a Silicon Valley lookout that has a pretty spectacular view of the environs below.

With a sweep of the arm, Zuckerberg discusses the technological history of the area, points out Apple’s headquarters…Hewlett-Packard’s…and the other biggies…and remarks that Facebook will eventually be bigger than all of them…and “If you joined us, you could be part of it all.”

One recipient of this dramatic gesture said, “The entire experience was totally surreal. I really felt like I was on a date.”

Speaking of rockstar recruitment conquests by Mark Zuckerberg, there’s an equally fascinating profile of Sheryl Sandberg, by Ken Auletta in the latest edition of The New Yorker.

Mark met Sheryl at the Christmas party of a mutual friend in 2007. He approached her and introduced himself. They chatted for about an hour by the door. At the time, Sandberg was Google’s 38-year-old VP for global online sales and operations and managed 4000 employees. Facebook was a company without any revenue.

For Zuckerberg, the meeting with Sandberg was wonderfully serendipitous. He knew that he was ill prepared to run Facebook on a day-to-day basis. By fortunate coincidence, Sandberg was ready for a change too. Over a six-week period, Sheryl and Mark met for dinner 1-2 times a week at Sheryl’s 6-bedroom home. Sandberg, who is not a night owl, often had to usher Zuckerberg (who is a night owl) out the door at close to midnight. “It was like dating,” says Sandberg’s husband Dave Goldberg (CEO-Survey Monkey). They spent long hours asking each other questions like, “What do you believe?” “What do you care about?” “What’s the mission?”

To Zuckerberg’s complete credit, he recognized that Sandberg was a perfect fit for Facebook. Says Zuckerberg, “There are people who are really good managers, people who can manage a big organization. And then there are people who are very analytic or focused on strategy. Those types don’t usually tend to be in the same person. I would put myself much more in the latter camp.”

Mark offered Sheryl the COO spot in February 2008. Within days she was asking questions, and listening, to her new Facebook colleagues…walking up to hundreds of people’s desks and introducing herself by saying, “Hi, I’m Sheryl Sandberg.”

Today, Sandberg meets with Zuckerberg twice weekly, Monday morning and Friday afternoon. Her workstation is a few feet away from Zuckerberg’s in a cavernous room, and also connected to three other senior executives, the VP of product, the chief engineer, and the C.T.O. Says Zuckerberg of Sandberg, “She handles things I don’t want to. All that stuff that in other companies I might have to do. And she’s much better at it.”

Given that the I.P.O. buzz on Facebook is now in the $100 billion range, which would most likely make Sandberg an instant billionaire, and Zuckerberg’s 24% stake continues to grow like topsy, this has been a fortuitous pairing.

by Chris Holman

Real Conversations

There’s a coffee shop that I have frequented early in the AM for my morning machiato, 4-5 days a week for the past six months. My conversations with the barista have always been very pleasant, very brief…and very superficial. It was never my intention to be aloof or indifferent to the barista, but I’ve never really stepped outside the exchange of banal pleasantries.

Until just the other day. I don’t remember how the conversation began. But, in a short period of time I learned that the barista is an aspiring elementary school teacher, who has been under-employed during this terrible job market. She was thrilled to tell me that she was recently able to find a summer gig teaching fifth grade in a tough inner-city school. Despite the inherent challenges with her summer assignment, it was obvious that school-teaching is her passion. We spoke for five minutes about her class in a conversation that was engaged, animated, and interesting.

I thought of this experience as I read Fierce Conversations: Achieving Success at Work & in Life, One Conversation at a Time, by Susan Scott.

What an engaging read! The essential premise of the book is the absolute primacy of the conversation. In the words of Ms. Scott, “While no single conversation is guaranteed to change the trajectory of a business, a career, a marriage, or a life…any single conversation can.”

Furthermore…

“The conversation is the relationship. If the conversation stops, all of the possibilities for the relationship become smaller, until one day we hear ourselves in mid-sentence, making ourselves smaller in every encounter, behaving as if we are just the space around our shoes, engaged in yet another 3-minute conversation so empty of meaning it crackles.”

This is not your typical light summer reading fare. However, it is chock-full of valuable insights and observations. Consider her, “7 Principles of Fierce Conversations”:

1. Master the courage to interrogate reality.
2. Come out from behind yourself into the conversation and make it real.
3. Be here…prepared to be nowhere else.
4. Tackle your toughest challenge today.
5. Obey your instincts.
6. Take responsibility for your emotional wake.
7. Let silence do the heavy lifting.
   

Does your life suffer from an over-abundance of trivial pseudo-conversations? Read this book!

You may not be able to ask, “How are you?” without really meaning it to a random stranger…ever again.

by Chris Holman