Are You Too Technical With Your Clients?

By David Miller

Recently, I started working with a new coaching client, and within our first few conversations, I asked her what her process was for meeting with a prospective client for the first time.

After about a five or ten second uncomfortable pause (which is about the norm by the way), she proceeded to launch into a speech about asset allocation, and a variety of other technical things, that for me, was like watching paint dry, except it was that special extra slow-drying paint.

Normally my reply would be far more polite than what I said to her; however, this was a terrific lady who had insisted I be brutally blunt with her about everything she did. “That’s why I hired you!” she told me in our first conversation.
With that being said, and with silent apologies to my Mother, I replied: “Suzanne (not her real name), I’m sorry, but you are putting me to sleep.” There was a nervous laugh from her, and I continued to say: “I am sure that there are some people out there that would find that level of detail interesting, for instance, someone who liked to read advanced calculus in their spare time, or perhaps another Financial Advisor;” however, that is not me, and I think that the majority of laypeople are the same way.”

“We come to hire the services of a Financial Advisor, and we pay for it, because we are ill-equipped to do it ourselves, and we want to make all that complication go away, not intensify.”

I used the analogy of a plumber with Suzanne, and I asked her if she had ever hired one before. She replied: “Yes actually, I had a plumber in about three-weeks ago because we had some leaky pipes in the kitchen.” I said to Suzanne: “You hired the plumber to come in and solve the problem I know, but did you want him to show you every tool in his toolbox and explain what each of them did? Did you want a play-by–play of his every step or did you have better things to do?” She laughed, and said: “No, hardly. I just wanted him to fix the problem and give me back my kitchen as soon as possible.”

Suzanne also sent me examples of some email blasts that she sent out bi-weekly to clients. I am on many of my clients’ email lists, and a large percentage of the emails I receive from Financial Advisors run afoul of this same aforementioned transgression. You know the ones I mean: “Technical Trends Show a Robust Year for Oil!!” and so forth.

Another of my clients wanted a critique on the emails he was sending out. I try to keep an open mind with such things, but just like Suzanne, I was having immense difficulty deciphering what it all meant. You see, I have a Financial Advisor who makes all of that stuff go away, and I pay him well for it. I am not well-versed in the subject as a result, and nor do I wish to be. Like Suzanne, he wanted the unfettered truth, so I said: “Well, it reminded me of a Doctor sending out an email with instructions on how to fix my own broken leg, when really, I just want the Doctor to fix it, and with as little pain as possible.”

What then should you discuss in your first appointment with a new client? We recommend an agenda-driven meeting that covers a short talk on who the advisor is, what the company is, a high-level view of how the advisor is compensated and of course a description of the advisor’s approach.

Re the ‘approach’ aspect, which is typically where things start to get too complicated, we encourage advisors to use the language of Critical Financial Events. These are things that can impact long-term goals and objectives of the client. What are Critical Financial Events? Critical Financial Events are anything to do with money, especially those things that might necessitate an adjustment in the overall strategy. I like this a lot because it took me about 30 seconds to understand it. Your clients will like it for the same reason, plus, they will start to recognize Critical Financial Events happening all around them, and where they didn’t previously.

The job of the advisor therefore, is to understand the overall goals and objectives of the client, and then and then to navigate the client through all of the Critical Financial Events of their lives, adjusting and readjusting the plan when necessary, in order for the client to get to their goals and objectives in a reasonable amount of time.
Do you think that this is too simple? Too dumbed-down? Try it and you will see differently. Remember, you are immersed in that technical world, and you are a Financial Advisor. You see things differently because it is your world, but it is not mine, and it is not your clients. Your clients will sit and nod politely when you start to get too technical, but don’t think for a second that the majority of them understand.

We have been using this precise approach with Financial Advisor for over ten years, and they have been using this simplified language with their clients. Advisors have told me more times than you can count that clients have come back after just one or two meetings, already using the language of Critical Financial Events themselves.

Think of the one or two clients (maybe more if you are lucky), that when you ask them about a technical issue or something that you are thinking of doing with their account, and they reply: “Oh David, whatever you think. You know we trust you.” Aren’t those clients the absolute best? Those types that empower you fully with their trust, that never hassle you, and that couldn’t give a fig about the technical side of things?

I ask you to envision this scenario: What if you had a hundred clients just like that?

Take action:
Visit www.paretoplatform.com to watch the video overview of the new Pareto Platform powered by Microsoft Dynamics CRM. Call 1-866-593-8020 to get your name on the free trial list.

Fixating on Technology more than People

In the era of the Blackberry, iPhone and other technical culprits, we often encounter advisory teams that have become extremely adept, and yet somewhat over-dependent, on these technologies and others like them. I am as guilty as anyone in this regard, but I do work on changing that reality.

People are indeed communicating with each other more than ever, but is it quality communication? So much of how we interact with each other is non-verbal. Emails, texts, etc. are largely depersonalized missives that move quickly back and forth, but to what end?

The risk inherent in all that technology is the lack of development of good, old-fashioned people skills. The more technology creeps into our lives, the greater the importance of face-to-face conversations, meetings and meaningful personal contact.

When you make a habit of cutting back, or abandoning altogether, non-essential technologies, this allows for the natural occurrence of better relationships within your team, a lesser chance of misinterpretation, and the continual honing of your team’s people skills.

Clearly your team will benefit from this, but it is also a certainty that your clients will too.

It wasn’t too long ago that none of these devices existed, and yet the business world still chugged along mightily, just like it always has. Instead of firing off emails and texts from a secluded room, team members actually had to interact with each other, and even look each other in the eye!

In the old days, as you know, a business deal used to be sealed with a handshake. I often wonder if there is any connection to this, and the fact that none of these technologies were in place at the time.

I realize that ‘old-fashioned’ face-to-face interactions still occur of course, but to a far lesser degree. I will say that when we do have face-to-face interactions, it sure seems like the chance of misinterpretation is by far to a lesser degree because we can see the body language unfolding in front of us, and we can experience the correct emotions that support the message. These are things that are integral for proper understanding of what is being said.

People sometimes forget that sound ‘people skills’ are practiced and developed skills. The less opportunities we have to ‘practice,’ the less these skills improve.

By no means am I suggesting that technology is all bad; Pareto Systems is primarily a CRM company after all. Our flagship product is the Pareto Platform: a CRM made exclusively for advisors. In fact, we even go as far as to say “No advisor’s office is complete without it!”

Before I start sounding hypocritical here, the difference is that the technology behind the Pareto Platform enables an advisory team to create processes using the onboard business development suite, and then automate those processes so that everyone no longer has to keep track of 20-30 things up in their head. This is highly significant from a communication perspective.

The end result is a whole lot more time and freed-up mindspace to do the things that you and your team need to do to enhance your team chemistry and your client relationships, and to build immense trust in the process with both groups.

Without our heads swimming in the minutiae of the typical business day, and by automating in this way, we are able to spend far more face-to-face time with top clients, focus on team relationships, and in short, create a consistency of superb communication that is unmatched.

Technology isn’t evil, there just seems to be good and bad ways to make use of it. Try to find the right balance within your team, and who knows? Sending fewer emails might just get you a referral or two!

For questions and comments join the Pareto Systems Group on LinkedIn and participate in the discussion.
Visit http://www.paretoplatform.comto watch the video overview of the new Pareto Platform powered by Microsoft Dynamics CRM. Call 1-866-593-8020 to get your name on the free trial list.

It is one thing to be honest, and yet another thing altogether to be both honest and forthright.

I often use the example of when I first started in this industry. In those days, mutual funds had a 9% front-end load. Most advisors today would shudder at the prospect of having to tell their clients that they would lose 9% of their investment the moment they wrote that check.

As I honed my sales skills in those early days, I learned rather quickly that if you told the prospective client this unpleasant news at the end of your presentation, 90% of these people would politely (and some not so politely) run for the door never to be seen again.

I also discovered that if this news was the first thing you told people, as opposed to the last, 90% of those people did not consider it a negative aspect of doing business with you.

From that point on, when I had a prospective client come into my office, or I met them in their homes or offices, the first thing I would say is: “It is important to let you know that if and when you decide to do business with me, all your investments will be subjected to a front-end load of 9%. What this means is that if you write me a check for $100,000, the amount of $9,000 will be paid to the mutual fund company. A portion of that will go to the investment company I work for and a portion of that will go to me.”

I remember the first time I tried this; I stopped after that statement and waited for the usual request for me to leave the premises immediately. It was a bit like waiting for someone to pull the trigger of a gun. After a brief pause, which seemed like an eternity, the gentleman said: “Well, let’s see what kind of investments you’re talking about.”

I almost fell off my chair. Of course I had been taught to tell the truth but this was a new wrinkle in the formula–being both forthright and honest right up front.

There are many ways you can apply this simple principle. At Pareto we often talk about advisors taking more time off to enjoy their lives. Many advisors are reluctant to do this and when they do take time off, they are even more reluctant to tell their clients. Is it possible that if we communicated to our clients well in advance about our vacations they would be respectful and understanding of our needs as well as their own?

So we are now into July, 2010. Many of you have your holidays planned and for some of you they are imminent. How good a job have you done communicating this in a forthright and honest way to your clients, or perhaps even your staff?

Many of the advisors we have worked with over the years send out a letter at the beginning of the year outlining the holidays they will be taking. Some even discuss where they plan to go and what they will be doing. Some even include it as part of their newsletter. When they get back from their holidays they may even share some of the highlights of the vacation.
Clients appreciate this and some even get excited about your prospects for your time off. You may be going somewhere or doing something that is near and dear to their hearts. Or, they may have suggestions of particular activities or locations that they have enjoyed in their travels. Ironically, this can make you more interesting to your clients. Instead of your clients resenting your activities, they respect it and enjoy hearing about it. Of course this all depends on how forthright you were with them.

One last story to make my point; about 15 years ago, I listed a house with a real estate agent. The next week I called to talk to him about his plans to market the house. His assistant notified me that he had gone on holidays for two weeks. I was quite disappointed and put off by this discovery and asked her if perhaps it would have been reasonable for him to tell me this. She was non-apologetic.

Over the next couple of weeks, she called me several times to ask me if I was available to show the house to prospective purchasers. This was the proverbial salt in the wound. When he returned and I expressed my feelings he was indignant that it was his right to take holidays and had had them planned for months. Needless to say, he had completely missed my point about simply communicating more effectively to his clients. Fortunately I had listed the property for only 3 months. When he asked to renew the listing, I literally laughed out loud.

How differently could have that relationship evolved if he had been forthright? If he had explained that he had a vacation planned when I met with him for the first time, how would I have reacted? When he returned from his holidays, I am sure I would have had a conversation about his trip and not about his lack of communication skills. The property sold a few weeks later. He lost about $25,000 and any chance of a recommendation of his services.

If you haven’t been forthright about your summer vacation, consider how you can put a process in place to better communicate to your clients about your next holiday. You will be surprised how much they appreciate it.

For questions and comments join the Pareto Systems Group on LinkedIn and participate in the discussion.

Success Stories - Against the Odds with Duncan and Brian Danelian - July, 2010

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