Recently, I was discussing with my marketing team trends in advice/coaching related industries and how they are attracting new customers. It’s become clear that there has been a shift away from the old paradigm of “Always Be Closing” (ABC). There is so much product-driven information directed to us on any given topic that it’s become a serious turn-off for consumers. Having a product or solution that solves a problem, even marginally better than the next, doesn’t necessarily transform a prospect into a client. Having a product that works well is the minimal expectation. It’s going to take a whole new level of vision and leadership to help people produce new levels of success in their lives and in their business.
The new “ABC” as I see it, is to Always Be Coaching. Another way to look at it - Always Be Co-Creating. The new paradigm that I’ve been most attracted to has us ask for permission and seek opportunities to make someone’s life better, without necessarily showing an immediate solution to a problem. If you are in a service-based business like me, it’s clear that our clients don’t even realize they have a problem. In this new paradigm, we are literally earning the right to even ask for a sale or some form of business transaction.
In some cases, the perceived “easy” sale approaches us first. This happened to me recently through a referral that wanted to transact in our first meeting together. Wouldn’t this be the greatest problem in the world to have? People coming to us and asking to buy stuff right from the start? In a relationship where there is to be a superior level of trust and leadership, expected to last a lifetime, and sometimes inter-generationally, this is not always true. Fast engagements in the financial industry can have dire consequences. Financial dreams are not fulfilled, expectations are shattered, and nobody wins.
In this specific case, I had to request to put the brakes on a bit before analyzing her finances. I made it clear that we would be digging as deep as necessary once discovering the True Purpose for her Money. That also included looking at how the brain operates around investing.
As humans, we are subject to emotions, many of which sabotage our best intended efforts to be prudent investors. There’s no denying that fear and greed can be strong and destructive influences in our day-to-day financial decision-making processes. Mark Matson of Matson Money calls this phenomenon the “Enigmatic Circle of Investing”.
In phase 1 (Survivorship Stress), we have a basic need to survive. With respect to money and investing, I recall a very frank conversation with my dad while in the 10th grade that I should start getting good grades for we had little household money to send me to a decent college. As far as I could remember, we had the “no talk” rule about money in the household. It was difficult to be exposed to a serious issue about money with no prior understanding. I was very surprised to hear that we just didn’t have that much money. Up until this point, everything seemed great. We always had food on the table. There were never any expressions of stress or fighting over money. And somehow, we didn’t have enough to send me to a decent college (of which I thought I was entitled to). I remember being genuinely scared for my future in this moment and that I may not survive unless I got serious about my studies. Somehow, I pulled it off. My grades dramatically increased without sacrificing the 3 hours per day of skateboarding I was used to!
In phase 2 (Human Wants), we’ve obtained the basic needs for living, and we start to notice that we just want more out of our money and begin to realize some options in the marketplace. We become susceptible to marketing hype, negative press in the media about money and investing (24/7), and other useless noise. And we put our money in this new shiny thing we just heard about that promises 10, 15, 20% on our money per year!
In phase 3 (Obtainment), we’ve just put our capital at risk somewhere that seemed like a winning strategy. There’s often apprehension about what we’ve done along the way. Yet, we stick with the program and wait. There’s a sense of confidence and security that comes along for the ride.
In phase 4 (Relief & Exuberance), we’ve achieved our investing goal. We were right and they were wrong. And we are now validated, relieved and perhaps exuberant with our success. We honestly start to believe that the reason we are happy or confident is simply because of the performance of the investment. We also believe that we can do it again, and again. We equate dollar signs with true happiness. This sensation is often very temporal and can seem like fulfillment.
In phase 5 (Comparative Analysis) Phase five is where the Enigmatic Circle of Investing takes a detour. Comparative analysis begins to occupy our minds as we look around. Common self-talk can look like this. “What if I could have done better investing in the other thing? Does my advisor have my best interests in mind? I’m entitled to a 10% return!” What’s interesting here is that we start to believe that our survival is threatened once again, just like at the very start in phase 1. This is where a lack of coaching and context produces the greatest exposure to loss. Decisions based on negative emotions, such as fear, anxiety or greed, invariably produce negative results.
If we can identify and manage the destructive emotions from the decision-making process, we are well on our way to investor confidence. If we take the time to actually discover what our true purpose for our money really is, we are in a completely different investor paradigm. Our investing strategy is then based upon something so much greater than the money itself. Our lives could be driven by purpose, not just by dollars.
It wasn’t until I’d been in practice for well over 10 years that I finally realized what I’d been doing for so long in my engagements with clients. It wasn’t coaching. It was trying to predict the future and ‘plan’ around the prediction. Malcolm Gladwell, in his famous book Outliers: The Story of Success, gives us ample evidence of what it takes to master something. Here’s a snapshot of his study as appeared in the March 15th, 2009 issue of Bottom Line Personal:
“When we look at any kind of cognitively complex field -- for example, playing chess, writing fiction or being a neurosurgeon -- we find that you are unlikely to master it unless you have practiced for 10,000 hours. That’s 20 hours a week for 10 years. The brain takes that long to assimilate all it needs to know to achieve true mastery.”
What’s interesting is to consider that many successful business people/professionals rarely have the patience or the time to truly master such an important aspect of life. And hopefully for their sake, they can align with an advisor who has invested, and continues to invest, the time and resources into their own mastery of the subject. It all starts with a good conversation about the primary values that are driving our decisions. Then, the possibilities are endless and true coaching relationship can ensue.