May 22nd, 2012 by Dan Richards, ClientInsights.ca

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As part of a recent round of research with investors, a highly suc­cess­ful busi­ness owner dis­cussed his finan­cial advi­sor. On bal­ance, he’s happy with the job his advi­sor is doing, with the excep­tion of one small thing.

Here’s how the con­ver­sa­tion started:

“I’ve got the bulk of my sav­ings with a bro­ker that I’ve worked with for sev­eral years, and I’m gen­er­ally happy with the job he does,” was the open­ing com­ment. “He’s very con­ser­v­a­tive which I like, because it keeps my own aggres­sive instincts in check. As a result, when mar­kets cratered a few years ago, I didn’t get hit nearly as hard as the guys I golf with.”

Then I asked about the con­tact from his advi­sor, and he was happy there as well:

“My bro­ker touches base about once a month and is really quick to return my mes­sages. When we sit down to dis­cuss my port­fo­lio, he’s well pre­pared and has spe­cific sug­ges­tions; so the meet­ings are a good use of my time. And if I ask to meet at my office, he’s always will­ing to come to me rather than expect­ing me to go to him all the time.”

Then he paused and went on:

“There is one thing, though, that does bother me. Some­times when I’m speak­ing to my advi­sor on the phone, I get the sense that I don’t have his full atten­tion. As a result, I’ve had to repeat myself or he asks the same ques­tion more than once. It’s as if his mind is wan­der­ing, or he’s doing some­thing else while we’re talk­ing. And I do recall once or twice hear­ing some click­ing in the back­ground, as if he was typ­ing on his com­puter while we were talking.”

I asked this investor to tell me more about this:

“I don’t want to make a big­ger deal out of this than it is, but it’s really begun to bug me. My time is valu­able, and if we’re going to talk I want his com­plete focus. It’s got­ten to the point that recently I asked if he was set up on Skype so we could talk face to face. It turns out that his firm doesn’t allow Skype, but he did say that he would be happy to sched­ule a call from his home first thing in the morn­ing or at the end of the day.”

“It’s funny: recently my bro­ker asked me if it might be pos­si­ble to get an intro­duc­tion to my golf group and I said I’d see what I could do. What I didn’t say is that my big hes­i­ta­tion is being embar­rassed if one of my bud­dies has the same expe­ri­ence that I’m hav­ing. Given every­thing else my bro­ker does right, I can live with this, but I’m not sure oth­ers would feel the same way.”

Your two pri­or­i­ties on phone calls:

Let’s be clear here: The investor may be absolutely wrong about this, and it’s pos­si­ble that he has his advisor’s 100% atten­tion when they’re talk­ing on the phone. Whether that’s the case or not, he doesn’t FEEL that he has his advisor’s full atten­tion, and that‘s cre­ated a problem.

There are two mes­sages from this con­ver­sa­tion: First, in any inter­ac­tion with clients, we have to give them our full atten­tion. On long phone calls, that can be chal­leng­ing. One solu­tion is to make notes, cir­cling key points that you want to respond to.

And sec­ond, we need to ensure that clients feel they’re get­ting all of our atten­tion, by acknowl­edg­ing what they’re say­ing. Long peri­ods of silence don’t com­mu­ni­cate that we’re lis­ten­ing. On longer calls, you may want to recap client com­ments at key points: “Just to be com­pletely clear on my part, here’s what I’ve heard you say.”

Los­ing 10 points in your IQ:

For many of us, the key mes­sage from this con­ver­sa­tion is that we need to stop delud­ing our­selves about our abil­ity to do two things at once. I’ve seen advi­sors “lis­ten­ing” to con­fer­ence calls while work­ing on their com­puter, and I know that either the call or the work they’re doing (or both) are suffering.

In May, Prince­ton psy­chol­ogy pro­fes­sor and Nobel Prize win­ner, Daniel Kah­ne­man spoke to the CFA Insti­tute annual meet­ing in Chicago. He made the point that research shows we can effec­tively multi– task in a very lim­ited set of cir­cum­stances. If we’re doing some­thing that requires lit­tle con­scious atten­tion; for exam­ple dri­ving down a high­way, we can also carry on a mean­ing­ful con­ver­sa­tion with a pas­sen­ger. Because we’re dri­ving on auto-pilot, we’re able to divert our atten­tion to another activity.

That changes when we have to focus. As soon as the dri­ving requires con­scious thought, for exam­ple mak­ing a left hand turn into traf­fic, both dri­vers and pas­sen­gers instinc­tively stop talk­ing, because both know that the dri­ver shouldn’t be distracted.

The same prin­ci­ple applies to every­thing you do dur­ing the day. Any impor­tant activ­ity needs your 100% attention.

Still not con­vinced? A recent arti­cle on multi-tasking pointed to research show­ing that try­ing to do two things at once causes a 10 point drop in IQ, and reduces pro­duc­tiv­ity by as much as 40%. That 10 point drop in IQ is equiv­a­lent to los­ing a full night sleep, or twice the impact of smok­ing marijuana.

Read the arti­cle excerpt below and then resolve that start­ing today, on any impor­tant issue you will give that issue your full and undi­vided atten­tion; before it endan­gers client rela­tion­ships or costs you a referral.

Delud­ing your­self on multi-tasking:

“The pio­neer of this research is Pro­fes­sor Earl Miller, a neu­ro­sci­en­tist at MIT. He scanned vol­un­teers’ heads while they per­formed dif­fer­ent tasks and found that when there is a group of visual stim­u­lants in front of you, only one or two things tend to acti­vate your brain, indi­cat­ing we’re really only focus­ing on one or two items. In other words, our brains have to skit­ter to and fro inef­fi­ciently between tasks. But the real prob­lem occurs when we try to con­cen­trate on the two tasks we are deal­ing with, because this then causes an over­load of the brain’s pro­cess­ing capac­ity. This is par­tic­u­larly true when we try to per­form sim­i­lar tasks at the same time; such as writ­ing an email and talk­ing on the phone, as they com­pete to use the same part of the brain.

As a result, your brain sim­ply slows down. Even just think­ing about multi-tasking can cause this log-jam, as Glenn Wil­son, a psy­chi­a­trist at the Uni­ver­sity of Lon­don, reported a few years ago. He found that just being in a sit­u­a­tion where you are able to text and email, per­haps sit­ting at your desk, can knock a whole ten points from your IQ. This is sim­i­lar to the head-fog caused by los­ing a night’s sleep.

This is why Pro­fes­sor Miller, for one, is highly wary of the mul­ti­task­ing lifestyle.

“Peo­ple can’t do it very well, and when they say they can, they’re delud­ing them­selves,” he says. “The brain is very good at delud­ing itself.”

Not only does multi-tasking affect our men­tal clar­ity, switch­ing between tasks also makes us less effi­cient. An Amer­i­can study reported in the Jour­nal Of Exper­i­men­tal Psy­chol­ogy found that it took stu­dents far longer to solve com­pli­cated math prob­lems when they had to switch to other tasks; in fact, they were up to 40 per cent slower. And stud­ies in the US show that stu­dents who do home­work while watch­ing TV get con­sis­tently lower grades.

In the words of UCLA psy­chol­ogy pro­fes­sor Rus­sell Pol­drack:
“There is a cost to the way that our soci­ety is chang­ing. Humans are not built to work this way. We’re really built to focus.”

About ClientInsights.ca A breakthrough in client communication Not long ago, clients read what you sent them. Today that's changed. In the You Tube world we live in, many investors would prefer to hear from a portfolio manager directly. And instead of reading an article on tax saving or estate planning strategies, more and more Canadians would rather watch an expert discuss the topic. Clientinsights.ca was developed in response to these changes - to deliver information in the form that investors want to receive it. It provides over 150 short video interviews, each about 4 to 6 minutes - you can email them or watch a video along with clients to start a meeting. No matter how you use it, Clientinsights.ca is designed to help you take client communication to a higher level. Dan Richards Founder and CEO, Clientinsights.ca Read more from the author/contributor here.

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Tags: Background, Business Owner, Client Confidence, Contact, Full Attention, Instincts, Investor, Investors, Job, Skype, Successful Business
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