Congress may or may not give us a gift this holiday season by settling the ‘fiscal cliff’ discussions (read our recent blog posts about the ‘fiscal cliff’ here). Rather than wait for the unknown, I thought I could give you an end-of-year present: tips on how to make decision. While US government officials waver, you can move forward with effective decisions to improve and grow your business.
When I meet with financial advisors, I frequently hear about their ideas and options (both of which are many). But seldom do I hear that they’ve made a concrete decision. This reality reminds me of a time earlier in my career when my office mate and I created a term: Deer in the Headlights (which we referred to as DITH). Working 100-hour weeks and being asked to write proposals as we walked out the door at night were commonplace for us. We were overworked and overwhelmed, leaving us little ability to decipher what to do first; hence, we were often DITH.
In the midst of too much information, making a decision was difficult for my office mate and me, similar to what I hear financial advisors experience on a daily basis. Napoleon Bonaparte, the famed French emperor, stated, “Nothing is more difficult, and therefore more precious, than to be able to decide.”
Rather than feel like a DITH, here are a few tips to help you make decisions.
1. Involve those who know best. Rather than dictating a decision to your staff, seek help from them. Your staff is a great source of information as they are often closest to the problem and know the issues better than you do. Maybe you are trying to determine a procedure for your office or improve your communications to clients. Informally ask some of your employees their thoughts on the subject. Or, call a team meeting and have everyone share feedback and offer solutions. Every person on your staff offers unique insight. By involving them, you will empower them to be active participants in helping you improve and grow your business.
2. Create a team of leaders. Sometimes the best solutions can be found in nature. Ants have frequently been studied as scientists strive to learn how ants make decisions so quickly. Despite their small size, ants have devised an ingenious way of building consensus, making decisions and leading. “Animal behavior: Decisions, decision,” a February 2009 article in The Economist, describes how ants, needing to make a decision about a new home, will send out scouts. Once a new home is found, a few of the ants stay at the new location, while a few shuttle back to the old location. The scouts who head back to the old location recruit new scouts and lead them to the new location. Back and forth the ants go until all is moved. It’s an exceptional example of leadership and teamwork working at optimal levels.
How does this apply your financial advising business? Consider the process of implementing a new software system to use for customer relationship management. By using learnings from the ants, you could designate a small group to search for the software. After software is chosen and the original members are trained, the team would bring on an additional person to learn the system. With each new person learning, the next round of learning happens more quickly as more teachers are available and more individuals are getting taught at a time.
3. Focus on Focus Groups. During the holidays there are many decisions to be made: whether to spend the holidays at your parents’ house or with your in-laws; what should you get your family members or employees for gifts; how much time should you take off from work? The decisions are endless, and, like investing for your clients’ portfolios, your options are plentiful.
Let’s look at another analogy from nature to help you make decisions about what investments to use with your clients. Christian List, from the London School of Economics, conducted research on how bees make decisions (Group decisions in humans and animals: a survey). He found that bees select a new location for their home through dance. A few locations are scouted out and the one that receives the longest “dance” wins.
Now, I am not suggesting that your clients do a dance to provide feedback about an investment option. Rather, I encourage you to gather feedback from your clients through a focus group. How? Here’s an example:
When I launched the Exchange Traded Funds (ETFs) in 2003, ETFs were relatively new. An advisor that had just started working with us used a focus group to determine whether or not to use our ETFs. He gathered several clients and gauged their interest in the ETFs through questions and dialogue. After an overwhelmingly positive response from the focus group, he decided to use our ETFs. The focus group allowed him to efficiently make a decision. His clients were thrilled with the option and recommended it to friends. As a result, the advisor was able to accelerate the use of ETFs within his entire client base, and, best of all, he picked up some new clients. You can do the same with one product or many.
While a decision about the ‘fiscal cliff’ may continue to be unknown, you certainly do not have to experience DITH. With our three tips above, you can involve your employees and your clients to execute faster, more thoughtful decisions in the New Year.
Homework: Think about how you can engage your staff, create a team of leaders and implement focus groups to make more efficient, effective decisions.