Heard of Learned Helplessness?
It is a condition first researched in the 1960s by a team of psychologists that included Professor Martin Seligman.
A group of dogs were given mild electric shocks.
Some dogs could press a button to stop the shocks, while a second group couldn’t.
However, when the second group were subsequently given access to the button to stop the shocks, they didn’t.
They accepted the shocks as just the way life is.
It turns out humans are similar.
Seligman’s team found that humans are naturally wired to become powerless.
Humans believe they have less control than they do, and they too quickly accept oppressing situations as the way their world works, which clouds their options and reinforces their circumstances.
This is particularly so regarding the value of an adviser’s advice.
WHY ADVISERS BECOME ADVISERS
Today’s advice industry appears stuck in a common and ridiculous compliance narrative that assumes advisers are using other people’s money to make their money.
This contradicts that most advisers become advisers to help others rather than building as many transactional relationships as possible.
Advisers want to build valuable relationships.
They want to matter.
If what matters most in an advisory relationship is low fees, above-average returns or single specific expertise, the relationship becomes transactional, margins are squeezed, and growth means more transactions, ironically making the advisory relationship matter less.
For most advisers, their best days are those when they are absorbed in resolving their client’s issues that are hindering what is of value to them. In contrast, their frustrating days are spent dogged by the consequences of their valuable work – the paperwork, HR, technology, compliance, finance, or supplier issues.
Thanks to Seligman’s theories, many of these issues become an adviser’s main issues.
MISALIGNMENT
In the early days of most adviser’s development, success wasn’t due to their systems, procedures, fees, technical skills or experience.
It was the value they provided.
They made themselves matter to their early clients.
As mattering means different things to different clients, the value wasn’t a specific solution, but the role being promised as advisers in their early years earned their respect and confidence based upon the relationships being formed much more than the tax strategy, asset allocation, statement of advice, insurance product or loan being delivered.
But as growth becomes a challenge, advisers use tools and strategies built for a more industrial era hoping to overcome issues while retaining the essence of their success.
This can create a ‘dull ache’ of misalignment.
This ache grows as more activity begets more activity, as more options create more confusion, more demand requires longer working hours, and as inevitable mistakes grow, reputations and enjoyment reduce.
Bigger isn’t better – better is better.
THE ‘DULL’ ACHE
The ‘dull ache’ is a message.
Our best next step may not be greater systematisation or higher prioritisation of options built from the industry’s product-based industrial past but it is the heart of every deep advice relationship.
Value.
It is a client’s experience, not an adviser’s deliverable.
This is the step to breaking a common activity-based treadmill so prevalent in so many advisory firms that were first discovered in early advisory conversations and still inherent in deep advice conversations.
Seligman’s proven theory explains what a continued adherence to ‘bigger is better’ thinking will produce.
However, advisory firms can better avoid becoming victims of their growth by adopting a ‘better is better’ model with a greater trust in the value being created for most new prospects and existing clients.
Better products, software, resources, third-party providers, and systems will always exist. There is an endless search for everyone distracted from the needed focus on value searching through an exponentially growing list of alternative administrative, management, technology and product solutions – but something will still be missing.
The intimate, accurate and methodical understanding of the value of advice.
Value is an advisory team’s greater power and freedom.
It is the returns-builder.
The more focus advisory teams place on their intimate, repeatable and specific value conversations with clients and prospects – the more advisory teams will unleash the true driver of better growth.
What do you reckon?
Photo credit: shutterstock_776381272