Giving good advice is different to giving people what they want, isn’t it? Most financial advisers can do both, and many do in fact deliver both. That is, they often give people what they want because that is after all what the consumer wanted….and the consumer is the boss and has the right to say “I want this”. Even if “this” is stupid or patently the wrong thing to do, the consumer has the right to do it. Correct?
Is that the end of our obligation to the consumer? To just accept that they have the right to make supid decisons, or do we have an obligation to be giving them good advice whether they asked for it or not?
I hear arguments from both ends of the spectrum on this…with one camp suggesting that our professional obligation is to deliver good advice whether people asked for it or want it. The other camp suggests of course that the “customer is king”, and if they don’t want advice then we are over-stepping our role and relationship in forcing it upon them.
There is a middle ground of course where we can give the consumer the option of getting some brutal “in your face” financial advice that will actually help them, or delivering the limited advice they ask for which may in fact hinder them. I suspect that is the optimal position – preserving the right for a consumer to make irrational or less than ideal decisions whilst preserving our professional positioning.
One of the things that good financial advisers (indeed; any professional!) has to be able to do is deliver tough conversations and direct advice, whether the consumer is up for it or not. You have to have the ability to diagnose the illness and prescribe the treatment whether the patient wants the bad news or not. There is no doubt in my mind that this is the area where good advisers deliver great value and make a distinct difference: dealing with the tough stuff. It is the tough conversations that provoke change and corrective action on the part of clients….that lead to the results which the clients actually want us to help them achieve. This is for me undoubtedly the highest value area.
But not all consumers are up for that. Otherwise they wouldn’t buy products online or from the bank teller that started in financial services last Thursday, right?
We need perhaps to be a little clearer with consumers about what we do as “advisers”. Diagnosis before Prescription…That is what we do. That is what clients want us to do. That is what they pay us for. We are advisers. We give advice founded upon fact and rooted in knowledge.
But maybe the consumer doesn’t want that. When I say “doesn’t want that” I really mean “doesn’t want that NOW….in THIS instance“. This is what actually creates the professional dilemma: good clients who have engaged in advice, or will engage in full advice in the future, who have a transactional expectation now do not necessarily want the full advice process. It is this situation that calls for having a middle ground position well thought out in advance…..because good planning clients will sometimes have very simple needs, and trying to wrap complex advice around a simple requirement can cost you that very good client.
So when we are faced with this professional dilemma, why not be clear about what the choices are and what good advice is:
“Like a doctor; We analyse a situation professionally and objectively, and then deliver the diagnosis and the prescribed treatment. Whether the patient wants to hear it or not…but you will know what the right course of action is.”
Being able to objectively assess a situation, and then deliver the tough advice with empathy is what great advisers do. But I think we also have to be conscious that often this is not what consumers want.
“Of course, if you prefer to Google your own symptoms and figure out what is wrong and then just want to come into our pharmacy and buy some over the counter medication that may or may not help then that is your choice too.
You are the customer, so you tell me: do you want me to work out what you really need to do or do you just want us to fill your order?”
THIS is where the adviser choice comes into play I think…do we believe or are we allowed to provide prescription without diagnosis? Some business models can of course, but some can’t. Some licencing or qualifications permit it; but some don’t. But I think we have to understand that sometimes the client is quite right to say “I just want to buy some paracetomol….I don’t need 3 hours of compliant professional process thanks”
Perhaps your professional positioning, like the medical specialists, is to say “we only provide advice, and only upon these terms and in this specialty”. That’s ok….it is a solid professional position with clear expectations for all parties. But perhaps you have a practice that offers both advice and retailing….and that is ok too as long as consumers understand whether they are getting good advice or not.
Giving good advice can be positioned as an option for both the consumer and the adviser. Being a retailer and never offering advice is a business model that can work too. We do need to be stronger at outlining what the consumer choices are when working with us though, and then ensuring there is a clear understanding about whether good financial advice is part of this engagement or not.