Many advisers will, at some point in their personal development, have attended a sales course. Advisers certainly need some basic selling techniques, but it has led to a product focussed tradition of financial advice which is embedded into many larger firms. Product sales are also a central assumption of regulation.
In financial planning, however, it is often important for clients to let their thoughts to wander a little before the adviser brings them to a point.
Last to Thursday I helped deliver a course teaching business coaching techniques to advisers and paraplanners (in conjunction with Threesixty). This was a pilot and we learned a great deal to tweak the course in future. The feedback forms gave almost entirely 4/4 across the board and we plan to put on a lot more events.
So what did we learn?
Coaching and advising require almost opposing skill sets:
A skilled adviser will identify clients’ issues and provide clear advice in order to provide a solution.
A coach helps the client to identify their own solution by focussing on their issues. The adviser’s own views should not influence the conversation.
Even the best advisers are trained to head straight to a solution. For commission/fixed fee based advisers there is a set amount of income, therefore the quicker the solution can be found the better.
And yet there can be advantages to allowing a client to explore their motivations and dreams a while. Coaching can bring a huge amount to the client relationship.
Imagine a business model where there are no complaints, all clients are retained for the long term, and client file checking is a mere formality. Applying business coaching techniques can genuinely help achieve this (although there are a few other changes to the business that would help a lot too!).
Unsurprisingly, not giving advice does not come naturally to many advisers. What attracts many people to being an adviser in the first place is the desire to help people, to do some good. And we inevitably think the best way to do good is to tell people what they should be doing (I’m sure this isn’t just me…).
Coaching helps people in a different way. A good coach helps the coachee work out their own problems. It can even seem like the coach has done nothing, the coachee has done it all themselves. This can actually be a good outcome; as long as the coachee has a result, that is what matters most.
Adding this as a stage on the advice process is hugely powerful as it enables the client to really stretch their thinking, in many cases to consider issues and possibilities no one has ever allowed them to think about before. And then the adviser side of our role steps in and helps devise a financial plan to help bring these dreams to reality – or maybe, if necessary, to bring a bit of reality to the dreaming!
Even compliance likes coaching. A key coaching skill is to use the clients own words and phrases. Add these into your reports and not only will the client feel you’ve really understood them, but so will your compliance officer.
I’ve been using coaching skills in our practice for many years now. We haven’t had a complaint for as long as I can remember. This isn’t about developing ‘soft skills’ (although that does play a part). This is about a fundamental change in the approach to dealing with clients, and can bring with it huge advantages to the adviser and the firm.
Chris Budd is a diploma qualified business coach. For more information on these courses please email firstname.lastname@example.org