Being Qualitative – Episode Transcript

Chris:                                         Todd and I have worked together for about eight years and have been partners for the last six, and every time we get into a conversation about things like we’re gonna talk about today, it’s powerful. Todd, welcome. Glad you’re here, man.

Todd Fithian:                        Thanks so much. Excited to be here.

Chris:                                         Awesome. Cool. I know we get to talk all the time, but we don’t always get to set dedicated time to talk about this, and today we want to talk about what it means to be qualitative for an advisor, and we talk around this a lot. We address this in training and programs and speaking and so on. But it’s not very often you and I go and carve out time and say, okay. Let’s talk about what it actually means to be qualitative. Let’s dig into it.

                                                      Let me throw the question to you at a real high level. For a financial advisor, what does it mean to be qualitative?

Todd Fithian:                        I’d simply put it this way, Chris, that to be qualitative is really the approach, the mindset of where an advisor is going to act and behave in a way that it’s more important to understand what matters to their clients or to the prospect that they’re engaging with. What matters to them is more of a priority than the resources or the tools or to the knowledge that they have to be able to the relationship. They’re putting what matters to that person over their own personal interests. At a high level, that’s what we mean about qualitative.

Chris:                                         Okay. If I’m putting somebody else’s needs ahead of my own, that makes me qualitative in that moment? Because I can do that from a numerical point of view, right?

Todd Fithian:                        Yeah, yeah. There’s a lot more than you need to bring to it. There’s a lot more than needs to show up, and you have to really jump into it with intentionality. There’s ways in which you need to behave and ways in which you need to act in that interaction, in that conversation to really be more qualitative based. It’s not a thing of just being aware of the fact that I want to serve what matters to them, but you have to really show that and you have to really be able to dig into that conversationally with the person that you’re engaging with. It really has to show up in a more meaningful way.

Chris:                                         Yeah. Like a lot of people, you’ll hear there’s all the hard numbers but then there’s all the soft skills. Oh, yeah, it’s that soft skills stuff. Yeah, yeah, I got it, right? We always joke that it’s like, the soft stuff is the hard part, right? Because I can go and take a course, I can go and get a designation about my numbers, right? On the hard data, I can go and get courses and certifications and I got spreadsheets for it and all the rest of it.

                                                      But well, when it comes to the soft stuff, all the kumbaya stuff, yeah, yeah, you gotta be good at that. But it’s kind of more than that, isn’t it?

Todd Fithian:                        Well, it’s interesting you say that. Just even using myself for an example, going back to just being a young kid, I’ve always been somebody where relationship was just at the core of how I was. I’ve always been interested and inquisitive about people’s stories. When I came into growing up third generation of financial services and watching my grandfather and my father interact with their clients, they did relationship well. The people really connected with them and really appreciated it and the things that they were doing for them, but what I realized is that there was no real science behind it.

                                                      I think there’s a lot of people in financial services, Chris, that are running around that do relationship well. It matters to them and they care. It’s a very small percentage of people in financial services, I’ve found over the 20 plus years I’ve been doing this, but they have some innate abilities and skills that are just in them, right? They don’t necessarily know it. It’s almost that, what do we say? The unconscious competent, you know? They’re actually doing some things really, really well, but if they could actually understand what they’re doing and build strategy around it and a process around it, what could happen? There’s those people that are walking around.

                                                      I also think there’s a fairly large population of people out there that have these abilities, can develop these skillsets and approaches and go do training. Today, there actually is quite a bit of training that you can do in this space to hone your skills, to become more qualitative, in fact, and develop those soft skill approaches and things.

                                                      Then I think it’s important to also note that there’s a percentage of the population out there that I think just struggles with it and is always gonna struggle with it, even though they can attend all the courses, read all the books, and get all the certifications, I just think that there’s certain people that it’s just not them. It’s not who they are, and you know as well as anybody, trying to be something that we’re not is never gonna have a long term viable result that I think we all want.

Chris:                                         Totally. We see that in the marketing front all the time, right? It’s about authenticity. You’ve got to be the real version of you. When you talk about it, there actually is training. There are courses people can take on it. I think about how many conversations I’ve had with advisors along the way where it’s like, well, yeah, there’s training and you can get better at this stuff, and it’s like, they’re looking at me, like, hey. I’m a top producer. I’m clearly good at relationship. I’m clearly qualitative, otherwise these people wouldn’t buy from me. It’s not quite like that, is it?

Todd Fithian:                        I’m glad you brought this up, and this is one that I spend most of my days, whether coaching or talking to new advisors or traveling around-

Chris:                                         Because who’s gonna go take a course for that? It’s like, I’m a rockstar, you know what I mean?

Todd Fithian:                        I travel around and speak on stages all over the place about this, and the one thing that has become clearer and clearer to me is there’s a lot of people out there that shut this thinking down because they believe that they already do it. They believe that they’ve already developed and really identified these skills and are portraying these skills, but the reality is, and I’ve just come to a point, Chris, where I’m just calling it out there. I’m just saying, this is not what you’re doing, and in a short conversation with pretty much everybody I’m talking to, we can help them to understand and see that.

                                                      The reason is this, is that when you look at the process, the approach of being an advisor, being a success advisor, it means you’ve got to get in front of the right types of people. Whether you’re doing marketing that’s moving people closer to you, or you’re doing a great job for clients and they want to talk about you and introduce people to you, the thing that I find almost consistently across the board with people that we’re talking to is they get a lot of names and they get a lot of introductions, but those introductions only result in a real meeting where we’re sitting live face to face with somebody, and opportunity to really have more of a significant conversation, a very small percentage of the time.

                                                      While we might be getting 10 or 12 introductions from clients or other influencers or whatever it might be, or our marketing, the percentage that we actually end up being in front of, Chris, is a very, very small percentage in this business. I ask advisors, what’s happening there? Why is that happening? That usually leads to a really interesting conversation.

Chris:                                         The qualitative stuff, then, starts before they become a client, then, is what you’re saying. It’s early on, as you’re starting to have these early interactions.

Todd Fithian:                        We talk about a ton in our work, first impressions. Years ago, I was researching and came across some studies on first impressions, and it showed that if we fumble on our first impression, which I might be out at a cocktail party with my wife and we run into some folks and we chatting up conversation, and somebody asks me what I do, and I respond to that, and I’m trying to swallow my tongue now and say I really wish I didn’t say that. That’s an example of our first impression. There’s lot of first impressions, but the reality is, 12 years ago studies were saying that it took seven additional touches to be able to reframe how that person or how those people perceive you from that first interaction. Now-

Chris:                                         You should say 12 now, too, Todd. The last year or so, and it’s not for sure, but they’re thinking it’s more like 12. It’s a crazy number.

Todd Fithian:                        It’s not getting better. It’s getting worse.

                                                      What I want to equate that back to and it goes back to the piece I was saying earlier, is that that’s a meeting of somebody. That’s an opportunity to turn a social interaction into a professional opportunity, and how we behave and what we say and how we make them feel, right?

Chris:                                         Yeah.

Todd Fithian:                        I use that quote in my talks all the time, and it’s-

Chris:                                         Maya Angelou.

Todd Fithian:                        Maya Angelou, thank you. It’s basically it is, people won’t remember what you said. People won’t remember what you did, but people will always remember how you made them feel.

Chris:                                         Yeah.

Todd Fithian:                        Again, when you talk to somebody on the phone, when you meet somebody and interact with somebody in that social setting, those are all things that are impeding on advisor’s abilities to move that into a real conversation where we have an opportunity to spend some more time together.

                                                      I really feel like this happens in those first interactions. It’s critical how we behave from the get go, from-

Chris:                                         All right. Let’s get punchy with a couple things here, because we want to make sure we get as much as we can as fast as we can, although I don’t care if we go long on this because this matters. But qualitative is addressing beyond just the numerical side of things. It’s going after what actually matters to this person, why does it matter to them, and making sure that we’re serving that stuff in a way that’s emotionally intelligent, good relationship intelligence, social intelligence and so on.

                                                      But who cares? What’s the point? Listen, at the end of day, I’m an advisor. I need to gather assets. I need to write insurance, right? Yeah, yeah. Are you telling me this is the sales tactic, Todd? What is it?

Todd Fithian:                        What I’m gonna tell you is you’re walking by more opportunities than you recognize if you were not incorporating the qualitative elements into how you’re engaging interacting and how you’re making people feel. I’m gonna give you a really simple example of this. Part of the struggle that as financial advisors, I can say this because I was one for many years-

Chris:                                         Yeah.

Todd Fithian:                        Part of struggle that we have, and we see this all the time in our business with even the most successful, on paper you would say, this is a really successful team, an advisory team here. But the reality is that to the layperson, to the consumers that we all want to engage with, it’s kind of that whole theory around the duck. You look like a duck, you sound like a duck, you quack like a duck, it’s a real duck. [inaudible 00:11:35] factors, right? That are impeding on this, and then we have our actions that are impeding on it.

                                                      The external factors are we’ve had experiences. People that you’re interacting with are having experiences at that moment, maybe that morning, maybe that day, maybe that week with an advisor, good or bad. They’re probably all had good or bad experiences with advisors, and so there’s a perception of here’s another advisor, and how do I feel about that, right? That’s impeding on that.

                                                      The other inside is your actions and your behaviors. What are you doing and saying to say I’m not a duck, right? Because here’s the deal. If you’re acting and behaving in ways that isn’t fitting for them and ways that they’re looking for in an advisor relationship, you’ve just missed another opportunity there.

                                                      We talk about this quite a bit in our work where advisors challenge us all the time on these things and say, well, I want to be different. It’s super competitive out there. If I don’t want to be a duck, how am I gonna be different? Show me how you would do that. It’s something that we often jump into conversationally because one of the things that we notice is that when an advisor is meeting with somebody who’s been successful and they want a longer conversation with them to explore, what they find is those people are saying hey, I’ve got a guy. Everybody who’s listening in to this, I’ve got a guy. I’ve got a gal. I’ve already got somebody who helps me with that. Sorry about the guy gal, I think it’s a Boston New England [crosstalk 00:13:14]-

Chris:                                         It’s a phrase, though, right?

Todd Fithian:                        Right?

Chris:                                         Yeah, totally.

Todd Fithian:                        I’ve got somebody, and it’s the blow off because I’m not looking to engage, buy, anything of that nature. What I’m gonna tell you is while that might be true, that defensive mechanism comes up because they simply just are not looking to buy, engage, get investment advice or any of those types of things. How do we break through that?

                                                      I see so many times where advisors move immediately into a defensive posture because when I say Chris, listen, I’ve been working was team of people. I’ve got people. What makes you different from them? I see advisors stepping to try and address that all the time, and you’re in a defensive posture immediately because you’re gonna talk about how long you’ve been doing it, results you’ve gotten for other clients. You’re gonna talk about your credentials.

Chris:                                         You have to indirectly make them wrong. You have to say you made the wrong choice.

Todd Fithian:                        100%. You’re trying to make yourself better than the other people.

                                                      The reality is, you don’t know anything about those other people that they’re working with, and the reality is you don’t really, at this point in time, know what’s going on in their world. How can you begin, or why should you begin, to try to defend or differentiate what makes you different?

                                                      Here’s the tact that I would just share with the folks listening in to this podcast today, and it’s kind of at the center of the work we do, is simply this: I would say Chris, I totally appreciate and can understand why you’re asking the question, but because I simply don’t know what’s going on in your world or the things you’ve done or haven’t done, and I really don’t know who all is advising you around those things, it wouldn’t be fair for me to step in and talk about why I might be different, or even maybe to say I’m better than what you’re doing or who’s helping you today. What I’d really like to do is take a few minutes to talk about the difference I make in the client’s lives that I serve, okay?

                                                      I know you know what I just did there, but what I just did was I took it off of me. I’m no longer defensive. I’m no longer beating my chest and saying looking how good I am, look how good my team is, look at the success we’ve had. What I’m saying is let me show you how it made an impact on the people that we get a chance to serve. What I did is just made it about you. That is the first step in becoming a qualitative advisor that I think is absolutely critical and impactful.

                                                      Now, what you say next is really, really important. What you do next is important, because you gotta now demonstrate, you gotta reinforce it, but-

Chris:                                         But you just threw the spotlight to a conversation that people aren’t having. Even if they think they are … If part of qualitative is we’re gonna throw the attention, put the spotlight on what matters to the wealth holder and why that matters and what the impact will be to them and their lives, then the starting point for that conversation isn’t me. It isn’t why I’m good or why I’m better, or why we have a great pedigree. We’ve been doing this forever. Nor is it about here’s, actually, you need to be insured, or you need to invest differently, or you need some kind of [inaudible 00:16:22].

                                                      It’s none of those things. It’s just tell me, what matters in your life and why does that matter? What are you actually after? It’s a classic thing of people don’t want to buy drills, they want holes. Advisors are busy competing based on how good of a drill they have, but nobody’s talking about what is it you’re actually really trying to create over there?

                                                      Let me ask you this. Two questions. One is, what actually gets an advisor to shift from probably how they’ve been trained and how they’ve done things in the past, to start to shift into these different conversations? What’s the thing that tips it for them? Is it production? Is it relationship? What do you think that is? Then what are two or three things an advisor can do today, right now, stop listening and do this, that will actually start having them engage more qualitatively?

                                                      The first one is what gets them to shift?

Todd Fithian:                        I want to make sure I understand this question, because it’s an important one. Is that just simply what you’re asking? What is it that gets them to shift?

Chris:                                         Yeah. I’m a successful advisor. Let’s say I’ve been doing this for 12 years. Things are going well. But what’s this qualitative stuff? Why would I shift off of being successful at this? What is it that happens in my practice or in my relationships with my clients? Because you could say we’ve got a better way to engage or whatever, but that doesn’t make us move. What has somebody move?

Todd Fithian:                        Thanks for clarifying that. I just wanted to make sure I was gonna answer it appropriately. First off, I’m gonna say there’s a very small percentage of people moving. People listening in to this might say well, that’s a problem. Why should I shift? Other people listening to this might say, sounds like an opportunity. Very small number of people actually jumping into this stuff, really understand this stuff. I’m gonna leave that up to that listeners. Is that a problem? Not time to get there yet, or that’s an opportunity. That’s a space where people aren’t. I’m gonna get there.

                                                      That’s the first thing that I think we need to think about, and that’s maybe the later second part question, Chris.

Chris:                                         Sorry, and that’s a little crazy that the blue ocean strategy here is have killer relationships. That’s a little mind blowing, right? We think that that would be, well, that seems a little obvious. But that’s really what I’m hearing you say.

Todd Fithian:                        Yeah, and what I’ll say is the blinders, right? That many of us have one is things aren’t going terribly. Markets right now are actually going great, and well, last year wasn’t overall a great year in the markets, but I’m just saying economy’s in a good place. Things are actually going pretty well for advisors. Businesses are growing. They’re not feeling that pain.

                                                      Things that cause people to shift are pain, right? Pain can come in a couple of ways. Oh my goodness, the sky’s falling. Markets are down. I gotta figure out another way to be label to add value. That’s one thing is when things are going bad around you, that moves people into looking for other ways. We’ve seen that historically.

Chris:                                         Right.

Todd Fithian:                        It’s not the motivation we like, because most times those teams, those advisors are running out with a little bit of their hair on fire. It’s not ideal, but it moves people.

                                                      The second thing is is when organizations move. We’ve seen this when an organization, it’s not actually by choice that an advisor or group of advisors would necessarily opt in, but their organization has made a decision that this is the way that we are going to behave. This is how we’re gonna create a demonstrable difference in how we do relationship and how we serve clients in the experiences that we bring.

                                                      The last one that I’ll say, and we’ve seen this quite a bit over the years, legacy. We’ve had advisors and teams and organizations driven to us because they’ve lost out to a highly skilled qualitative advisory team, okay? We’ve seen that quite a bit in our work, so I just lost my largest client and I lost it to this other advisor. What’s this other advisor doing that I’m not doing? Either the client names it and says this is what we’ve been looking for and this is what he or she does different or better or whatever, and so we’ve actually seen quite a bit of that where they’re like, that’s never gonna happen again. I’m gonna go figure out how to do this stuff.

Chris:                                         Yeah, how do I get that?

Todd Fithian:                        Last thing, I think it’s important to point that these lifetime learners. I love the advisors that are not complacent. We have a perspective that if advisors are sitting still, they’re going backwards, right?

Chris:                                         Mm-hmm (affirmative).

Todd Fithian:                        If you’re not constantly thinking about how we can be better, how I can be better, how my team can be better, how my business can be better on behalf of my clients and growing things the way that we want to grow things, that’s not a thing. You either behave that way or you don’t, and I think it’s something you can shift, but if you’re sitting still and not looking at ways you can evolve and be better, then I think you’re going backwards and you’re gonna simply gonna get surpassed over time.

Chris:                                         Absolutely. Leaders are readers, right? Which doesn’t mean you have to read, but it means you’ve gotta continue to learn, so absolutely.

                                                      All right. 60 seconds or less. Pop quiz for you. Two or three things an advisor can do right now, right now.

Todd Fithian:                        The first thing I would tell an advisor to do is get real. Get true. Look in the mirror. Look at what you’re doing. Look at your approaches. Look at how you interact with people when you meet them for the first time. Do you immediately go to what we would call a below the horizon conversation where it’s all about different strategies, tactics, tools, what’s going on in the market and all of those things? Be real. Look at your approaches. Look at your language. Look at your website and just be real. Am I behaving qualitatively or quantitatively, and I think that’s the first thing I would tell somebody to do. It’s really, really tough to say oh, no. This isn’t me. No, but I think you have to be true and real and look at it from an outside perspective.

                                                      The second thing that I would do is I would look at industry resources. Today, behavioral advice, behavior finance, things of this nature, these are very, very common buzzwords out there in the industry. At Legacy, we were studying this back in the mid ’90s before behavioral was a thing, but I would look at books and I would look at other model practices that you want to look like or behave like and engage with them and ask them what they’re doing and how they’re doing it.

                                                      But I think the starting point is you have to say okay, I think it’s important that we shift. I think we can get better results, and it starts by looking inward into the business, inward at the people, including yourself, and saying, how am I behaving? Is there ways in which I can grow and behave better to create better relationships, better long term sustainable business?

Chris:                                         One last thing I tack onto that just because we talk about this all the time is even without any training or anything, defer the conversation about product. Just like you were saying, the below the line conversation. Just linger around the conversation. What actually matters around you, and why is that important? You don’t have to take a course to ask those two questions. You could ask those questions, linger around that to actually understand that with wealth holders right now.

                                                      Todd, this stuff is critical. At the guts of it, this business is fundamentally an act of love. It’s like when that’s the backstory on why we’re having that conversation, and there’s that benevolence and that care about the other person, what do you actually want? In that moment, you start to shift and become a more qualitative advisor. The work that you do, I get to witness it every day. It matters, it’s impactful, it happens over and over, and when that shifts, everything shifts for the wealth holder and for the advisor, for their team. It really gives them the clients, the business, the life that they want.

                                                      I really want to thank you for sharing the time with us today, and appreciate you being here with us.

Todd Fithian:                        Absolutely. Thank you, and thanks for the time and the stage and opportunity to talk about what we do. We simply want to see advisors winning more, and they’re walking by too many opportunities unrecognized because they’re focused on the wrong things. We just simply want to see people winning more, consumers as well as advisors. Thanks very much for the time. I really enjoyed it.

Chris:                                         A pleasure. We’ve shared this time with Todd Fithian, managing partner and CEO of The Legacy Company, a Boston based consulting firm that works with financial advisors across the United States, Canada and abroad. Join us again for our next podcast. Thanks for joining us.