Dear Bev,
Lately the markets have been concerning to many of our clients. Some of our funds have underperformed, although we tout our ability to “not lose as much when the market goes down.” But we’ve lost way more than the market has over the last few weeks in a few of our strategies.
Clients are here for more than these funds. My own client book is not suffering defections, but I’m hearing from some of our younger team members they are having a hard time telling a story that defends what we’re doing. I’m not sure it is our role to defend poor performance – our investment team makes decisions and some of those are better than others. But overall we give our clients a well-rounded wealth management experience.
I’m trying to teach the younger team members not to focus on performance and to engage in relationship building. But most every one of them comes from a finance background and gets stuck in the numbers. I was a psychologist in a prior life and came to financial work in my mid-40s, about 15 years ago. I don’t see the discussion as numbers based; I see it as behavioral and emotional. I am going to guess you will agree with me and you probably work with other people like my team members. How do I help them understand they are only hurting themselves sticking to this approach? As an aside I have not lost one dollar in assets during this time. My clients call and say, “You will let us know if there is anything we should know.” I believe my philosophy is proven to work but I can’t get others to listen to me.
M.T.
Q2 2022 hedge fund letters, conferences and more
Dear M.T.,
“My philosophy is proven to work but I can’t get others to listen to me” could be the title of a book about my experience! I encounter your dilemma on a regular basis. In fairness to those who have traveled the finance route to get to this career, it is hard to understand and incorporate the emotional intelligence (EQ) or psychological component when this isn’t one’s background or training. A numbers person is going to look at the numbers, talk about the numbers and be connected to the numbers. You are absolutely right, it is a risky way to manage clients, because when the numbers don’t look so good, the emotional component comes to the forefront!
A few questions I’d ask you to think about as you try and appeal to your colleagues to listen and learn:
- Do they understand and can they tell your whole firm’s story? You mentioned your firm has a more robust offering than just the investments, but are your colleagues familiar with this story and can they tell it effectively too? I’ve often found that people default to what they know and they’ve been taught. Make sure they have been taught the story line so they can tell it effectively.
- Is the performance a key selling point for your firm? This is the difficult position many firms are finding themselves in. When performance was great, it was tempting (and easy) to sell on it, but when the market takes a dip (or two, or three or 10…) then it isn’t so appealing anymore and it becomes more about defending decisions and performance. Have a philosophy that you won’t sell only on performance no matter how great it is. Share the experience with your colleagues – younger team members probably haven’t seen the havoc a difficult market can wreak with clients. You can be a teacher.
- Have you approached colleagues in a non-threatening, non-ego centered way? Often when someone doesn’t listen, it is because we are delivering a message in a manner that shuts down their ability to hear us. I get your frustration and concern about not getting through, but I have to ask you to self-reflect and make sure you aren’t making it uncomfortable for them and off-putting. It is nice to be right and to have knowledge to share, but it’s always important to deliver the knowledge with an attitude of collaboration and concern.
- Have you offered to have a training session whereby you could walk through some of the best practices you are using with your clients and have an interactive discussion with team members so they can apply this to their own client situation? Sometimes a simple conversation isn’t enough; you need to help team members apply the concepts to their specific clients, practice with the dialogue and ask questions to engage. This is the difference between “tell me,” and, “help me learn.” Maybe you have been telling them, but you need to take the next step to help them apply this to their personal situations.
Read the full article here by Beverly Flaxington, Advisor Perspectives.
