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Kill Me Its Another Meeting1

Kill Me It’s Another Meeting

Some meetings should never take place!! When the leader of the meeting has no control over them, they are a waste of time.

According to research from Harvard Business School and the London School of Economics, executives spend upwards of 18 hours per week – a third of their working week – in meetings. And with an estimated 25-50% of meeting time considered wasted. Source

11 million meetings are held in the United States each day on average. That adds up quickly to 55 million a week and 220 million a month. By the end of the year, the meeting total is well over a billion. Source: (accessed 4/18/15). – Dave Johnson, How Much do Useless Meetings Cost?, CBS MoneyWatch (February 16, 2012).

The most frustrating meetings are when the boss let’s those with the loudest voice have too much time. Even trying to shut them up (politely) just doesn’t work. Then there’s the person in the room whose whole body language says, I know best; no one else’s opinion matters’. What about the colleague who has plenty to say on the way to the meeting, and just sits there and says nothing in the meeting. Poorly run Meetings are an expensive waste of time

Kill me its another meeting2.jpgSource: Google images www.annmarieklotz.com

Howard is compliant, hesitant and diplomatic. He is well liked and respected among most of his team and peers. But when leading staff meetings, Howard fails to control difficult people who upset the balance of the meeting and leave most of the remainder of the team wishing they were somewhere else.

The discussions tend to be unbalanced and very little gets resolved or decide upon.

Phil is the CEO and on one occasion sits in on the team meeting. He senses the atmosphere has no healthy positive energy; it’s heavy and negative; people are frustrated and deflated. Nothing is agreed. Phil knows he needs to work with Howard to improve his leadership skills.

Phil is goal driven, ambitious and yet understands the impact of knowing how to communicate with a range of people. Phil appreciates the importance of getting results through people management and strong strategic leadership.

Using his own experience as an example, Phil talks to Howard about how he felt when leaving the meeting. He explained that Howard needed to change the dynamic of the meeting in order to ensure people didn’t leave feeling frustrated, deflated and lacking a sense of direction. Phil explained to Howard the relevance to his leadership style of understanding behaviors. Further, he talked about the significance of becoming more effective and efficient in terms of managing individual communication styles. He explained that leadership required a person to adapt their own behavioral style to build relationships and meet the performance needs of a specific situation and in this scenario to manage meetings more effectively.

Four Primary Communication Styles Graph

Communication Differences Relationship Performance

Had Howard understood the dynamics and communication styles in the room and gained insight into his own communication and behavioral approach, he would have known how to manage individuals and control the meeting. Phil used examples of how he should be communicated with to help Howard understand communication styles. He then contrasted that with how Howard would wish to be communicated with. Very quickly Howard realized that he needed to gain insight into understanding communication styles if his meetings were to be effective in the future.

Howard

  1. Allow a short time to discuss family, life and non-work issues upfront
  2. Communicate at a slower pace and do not make them feel pressured – keep it even
  3. Have office meetings in a more living room environment
  4. Show with empathy that you care about their well-being and desire the best outcome for them.
  5. Give them step-by-step instructions to avoid any feelings of chaos.
  6. Provide lower end estimates of returns and keep them diversified
  7. Communicate security and the safety buffers
  8. Ask them how much contact they would like with you and what type (email, phone etc.)
  9. Indicate your feelings about the recommendations and get them to discuss theirs
  10. Invite them to group workshops and demonstrate how solutions work

Phil

  1. No long stories, keep to the point
  2. Keep meeting agenda short and focused
  3. Prioritize objectives around their goals
  4. Start with the big picture, not too much detail on one part of it
  5. Lay out the options so a decision can be made
  6. Provide bullet points
  7. Clearly outline risk/reward from best and worst case scenario
  8. Ask for their thoughts on recommendations
  9. Ask how involved they want you in the planning process
  10. Recognize them with referrals to other influencers
Banking Blog

Does Your Bank Truly Know What You Need?

A few weeks ago, Craig Moon who is a high net worth investor, received an unsolicited email from Renaissance Transactions Bank in New York requesting he invest in a new mutual fund investment opportunity. Apparently, the offer was being extended to all of the prospects and clients in the bank’s database who had previously filled out any kind of inquiry form.

Craig felt quite queasy in his stomach at receiving an unsolicited offer like this from a bank with whom he had no personal relationship. He had received similar emails from other banks before and gradually built up a lot of negative resistance to such approaches.

He couldn’t understand how a bank can make this offer when they hardly know anything about him. Craig’s experience in life taught him that if there is poor communication then the solution provider and what they offered could not be trusted. He wondered whether some of the banks were trying to get an edge on the consumer using faulty diesel-powered systems. After all, in the modern day age of Big Data research it would be reasonable to expect that a bank would at minimum use statistics and some casually built online surveys to roughly paint a persona of the prospect or client.

Craig reflected that given the recent stock market turbulence and increasing complexity of investing, this might be the time to find the right financial planning relationship.

 

Sales

The Land Grab by Banks for Owning the Client-Centered Financial Planning Space

While I was hearing Craig’s story at a seminar, I felt motivated to tell him that there was a fresh approach to banking and financial planning coming. No longer would banks and financial planning firms be playing the guessing game of what is suitable to offer a client and how to engage them.

I told him of an emerging trend of established banks out there starting to make a grab for the space of being the leading client-centered brand that put the interests of their clients first. In fact, this is what the regulators globally are requiring and the Obama Administration is pushing with the Fiduciary Standard, although it has not been happily embraced by all, yet. For a few years now, some of the banks had been re-branding themselves as client-centered but had no high-quality scientific process which required active client participation to demonstrate it. Craig became intrigued and asked more about what to look for from a bank who would potentially meet his wealth management needs.

I explained to Craig that what he should look for was a bank who adopts the approach of “understanding people before numbers” by discovering who the client is first and then collaboratively building a financial plan and investment policy statement which recognizes his complete financial personality. Craig said he had started to read about the idea of behavioral finance in the newspapers and investing magazines. I said that behavioral finance should be the foundation of the bank’s approach to customized communication and to the recommendations they make.

Ultimately, our conversation ended with me suggesting to Craig that he ask each of the banks and financial advisors he interviews:

  1. What formalized processes do they have to implement a behavioral finance approach which will help him achieve his goals?
  2. Further, have the processes they use been built and tested by a reputable and independent supplier of behavioral systems or have they been developed in-house to fulfill “tick-the-box” requirements?
    The Key Features of the Ideal Financial Planning System Powered by Behavioral Finance Insights

A few days later, at Craig’s request I gave him, in email format, a more specific list of the features that should be present in the financial planning service model to fit within the “new behavioral economy” age of financial planning:

  1. Clear organizational messaging: the “why” and the “mission” for delivering a service that helps clients live a quality of life based on who they uniquely are, in harmony and without regret. Put another way, helping every client in a customized way to “Live with Meaning.”
  2. Completion of an online activity at the banks very first touch point with the client: to discover the client’s communication style and the desired client service experience using a robust scientifically validated process.
  3. Customized first meeting experience with a relationship manager: someone who can naturally create the right environment for the client to share what they need and expect.
  4. Assignment of a wealth management team matched to the behavioral style of the client: to deliver a service that matches what the client wants -financial planning, investment management, philanthropy, family business etc.
  5. Completion of an in-depth online activity to comprehensively discover the client’s financial personality: the starting point – to reveal their natural instinctive behavioral style. This is not just a standard 5 to 20 question risk profile invented in the marketing department which can be manipulated and rarely tells the truth in down markets. Rather, a robust, scientifically validated process which objectively uncovers the client’s broader set of behavioral biases (including risk-taking) that strongly influence their decisions. Also, the financial personality reporting must be provided to the client for transparency with the comparison to the advisor.
  6. Completion of a goal-based questionnaire addressing balance across the key areas of life: to prioritize the needs and wants to be factored into the financial plan and investment portfolio design. Ideally, each of the client’s specific goals is addressed in the portfolio design.
  7. Real-time behavioral management of every client: during periods of market volatility on their unique terms. Use of online tooling to enable the client to monitor on a real-time basis their own “Market Mood” and patterns of behavior.
  8. Bank compliance processes: providing real-time monitoring of the recommendations made to each client with respect to their financial personality, financial capacity, and goals. The client should know that the bank will use exception reporting mechanisms to ensure their advisors keep the solutions offered within acceptable boundaries.
  9. Bi-annual review: conducted in person with the client or virtually using video.
  10. An advisory team that serves as the Wealth Mentor of the client: they need to adopt a coaching approach through asking powerful questions that transform the client’s thinking as they go through life transitions. Further, the firm and advisors demonstrate through this approach that the client is at the center of the relationship and not the bank’s fees.

Craig called me two weeks later and said that after extensive research and introductory phone calls he found many banks and financial advisors who said they delivered this service but actually did not. However, he was pleasantly surprised to find some leading banks and financial advisors were on this pathway. All of those firms on the right path were those using the Financial DNA behavioral finance platform developed by DNA Behavior International.

Craig made the decision to start working with the wealth management division of a solid US regional bank. He added that his research had revealed large banks and financial advisory firms in Canada, Australia, England and Europe moving this way.

I said to Craig, that as banks and financial advisors realize that relationship building is about customizing the communication with clients and the solutions offered, then they will win. Those who think relationships are only built on rates of return will fall far behind. Conversely, banks and financial advisors who act as a guide to clients in the financial planning process, rather than dominate them with transactions, will, within the next 3 years, grab significant market share, as well as, reduce the business risks of compliance.

Investment Committee integrated graphic blank

Investment Committees through the Behavioral Intelligence Lens

Most investment committees have a very clear mission: Serve as stewards for assets of the organization they represent.

Recruiting the right people to do that is critical to the success of the Investment Committee. But how do we define “right”? Is it a professional background? Education? Investment knowledge? And where does the diversity lens come in, if at all? What about their inherent risk-tolerance and behavioral biases toward investments?

In a study by Vanguard’s Vanguard Investment Counseling & Research on Group Decision Making for Investment Committees, there are definitely biases (both investment behavioral biases and workplace behavioral style differences) that should be considered when forming a committee with such important responsibilities in an organization.

Group Decision Making for Investment Committees Source: Vanguard Research

Most investment committees focus on five critical decision-making areas:

  1. Establishing goals or objectives for the investment portfolio they are managing.
  2. Setting an investment policy-on everything from strategic asset allocation to rebalancing policy to performance metrics.
  3. Selecting managers to implement the portfolio’s investment policy.
  4. Evaluating short- and long-term investment performance-both for the portfolio and for individual managers.
  5. Selecting experts (e.g., a consultant) to guide the committee as necessary.

As you think about how your committee recruits and selects new members, are you making the most of the opportunity to broaden the search to include those who would bring a diverse and beneficial perspective to the group?

As the research shows, this can lead to a more effective team and, in turn, a better outcome for the committee’s main mission.

Using a Behavioral Finance approach can shed light on the risk-tolerance and behavioral bias of the Investment Committee Members who may possibly be more wired for a Newness Bias or the More Anchored Bias. There are several behavioral biases that can either create conflict for the Investment Committee or potentially a group-think bias that could create risk for the firm.

In selecting an expert to guide the committee as indicated in bullet point 5 – Selecting an Expert, using a behavioral discovery process can add a dimension of behavioral diversity to the important function of the Investment Committee by ensuring the group can function collaboratively and effectively while also preventing “Group think.” Find out more on using Behavioral Intelligence and how to recruit the right behavioral fit for this important role in the organization.

Financial Advisors- Behavioral Finance is not Psychobabble

Financial Advisors: Behavioral Finance is Not Psychobabble

It’s no good screaming at your clients if they make dumb decisions. As a financial advisor, you need to stay on top of things. What’s your strategy to manage clients during market shifts? Some clients tend to make some very strange decisions when it comes to how they react to market movement and managing their money, not to mention taking advice from ‘friends‘.

If clients, for example, follow the herd and make irrational decisions regardless of the advice you give them, it will help you to understand behavioral finance to reveal core behavior and how to address it. If you don’t you will crash and burn as a financial advisor and be surprised by their actions and reactions.

Financial Advisors Behavioral Finance is not Psychobabble1

Source of photo: Google Images. Businesswoman_Stressed_MI600.jpg www.thinkadvisor.com600 338Search by image Emotional Decision-Making

Regardless of great financial advice, sometimes clients have a tendency to follow each other into precarious financial situations. They make foolish decisions and then expect the financial advisor to help them correct them.

Madison is a high income earning young professional. She leads a busy life and has just been promoted to a senior role meaning she has even less time to manage her money. She has always managed her finances successfully and has her own investment portfolio. She retains a financial advisor and makes it clear that she wants to continue to grow her portfolio but with low risk.

Madison is a very smart woman and somewhat reserved. In the busyness of her new position, she allows a group of outgoing vocal colleagues to persuade her to invest in a high-risk opportunity. Madison loses a significant amount of money.

As soon as the financial advisor is informed about this issue, she profiles Madison. She needs to understand how this smart intelligent woman could have been drawn into making such a foolish decision.

Having established Madison’s financial personality, the financial advisor is now able to provide Madison with insight into her decision-making behavior. Going forward, the financial advisor will be better able to manage Madison’s emotions and decision-making by customizing a financial plan to make improved long-term investment decisions.

Had the financial advisor known Madison’s financial personality up front, disaster could have been avoided.
Independent research shows that 93.6% of your role is the behavioral management of clients.
Source: Professor Meir Statman 2000.

Financial Advisors Behavioral Finance is not Psychobabble2