Know Thy Client

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In my work with financial planners, I frequently make the point that a successful practice is built on knowing and understanding their clients. I also emphasize that this objective can only be met through adopting the intention of getting in touch with each client’s unique frame of reference. The reason this is so important is that each person’s “frames” shape their personal version of “reality.”

There are many other terms for this concept such as perspective, world view, and mode of operation. However, one my favorites is “maps” as defined in Communication with Clients: A Guide for Financial Professionals by Charles J. Pulvino, James L. Lee, and Cynthia Forman:

“As people grow and develop, they store their life experiences and their reactions to those experiences. A person’s experiences are gradually woven into a personal representation of the world… Each person’s package of life experiences is analogous to a fine tapestry… In this book we will refer to these finely woven personal representations as maps.”

The authors go on to explain that maps are built over time through an accumulation of life experiences. They also emphasize that maps have a powerful influence on an individual’s financial life.

“Clients’ maps affect how they make decisions; how they use money; how willing or capable they are to take risks; and how they view their personal, business and financial goals. By understanding clients’ maps, you have a better basis for communicating with them.”

Several years ago, I read an interview in the Journal of Financial Planning with Elissa Buie, CFP®, former president of FPA, who provided a wonderful illustration of this point. Elissa indicated in the September 2001 article that she specializes in a holistic, client-centered form of financial planning. When asked how she got started along these lines, she replied:

“I had hired a business consultant and he pushed me to evaluate who were my best clients. I realized I had no typical profile: I had clients from all walks of life, income levels, vocations, and avocations. The common thread was that my best clients were the ones I knew the best. So I flipped that around and realized I had to make sure I know all our clients as best I could. I started taking a life history of all our clients and from that evolved the goal-setting capabilities.”

Elissa’s phrase “my best clients where the ones I knew the best” really struck me, and I have quoted it time and time again. What she discovered is that knowing a client’s history gives important clues regarding their maps or frame of reference. And that, in turn, provides the foundation for an effective and meaningful goal-setting process.

I believe the most successful client relationships are built on asking the right questions. That is because good communication is more about listening than it is about talking. And, to this end, the best financial planners continually seek to perfect their inquiry skills.

Carol Anderson
President
Money Quotient
Poulsbo, Wash.

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