How many times have you been reluctant to give negative feedback to a member of your team because you are uncomfortable with the potentially adverse outcome of the conversation? Have you ever decided that you no longer want to work with an unreasonable client, but avoided speaking with him or her about it? Perhaps you are disturbed by the behavior of a colleague at work but instead of confronting him or her, you allow the relationship to deteriorate, which impacts both your business and the morale in the office.
None of these conversations would be easy. In my coaching work, I have found one of the greatest challenges facing financial advisors is the art of having the difficult conversation. While some individuals are comfortable facing conflict head on, most of us often avoid difficult conversations because we are not prepared to deal with the potential discomfort they create.
PAYING THE PRICE
In your leadership role, you may not have the luxury of avoiding these types of interactions. Whether you are a financial advisor practicing alone or a member of a team, the ability to proactively and confidently have a difficult conversation is an essential leadership skill that can have a significant impact on the bottom line of your business.
Why is this skill critical? Ask yourself what price you are paying by not facing conflict directly. CPP, an industry leader in research, training and organizational development tools, conducted a worldwide study looking at workplace conflict. According to its findings, U.S. workers spend an average of 2.8 hours a week dealing with conflict. This translates into over $350 billion in paid hours annually. Worse, ten percent of the surveyed workers reported project failures as a direct result of workplace conflict.
On top of the financial costs, conflict avoidance can damage your credibility as a leader and the morale of your team.
We all know that initially when we are upset about something, avoiding the situation feels less stressful than confronting it. We tend to catastrophize and think irrationally about uncomfortable situations. Sidestepping them entirely feels better. But that strategy can work only for a short time; eventually, the situation will blow up in your face. Take, for instance, the situation faced by an advisor client of mine, who I'll call Scott.
MAKING BAD ASSUMPTIONS
Scott had been an advisor for five years. Although he was a rising star in the business, his production and assets did not yet warrant getting his own sales assistant. He was required to share an assistant with John, who was more tenured with the firm.
Scott and John always had a good professional relationship and Scott viewed John as an unofficial mentor. John also had a great working relationship with the sales assistant, whom he personally paid over and above firm salary. Scott, in contrast, did not feel he could afford to pay her anything additional. As a result, the assistant spent most of her time doing John's work, only helping out Scott when she was available.
Initially, Scott was fine with the arrangement, but as his business grew his need for assistance became greater. He felt that this lack of sales support was impairing his financial progress and that he was not getting the respect he deserved from either John or the sales assistant. This also led Scott to assume that the branch manager was aware of what was going on and wasn't intervening because he didn't value Scott's role in the firm.
Scott had difficulty asserting himself and became increasingly frustrated and angry with the situation. Unfortunately, when he finally expressed his feelings, it was in an explosive tirade toward the sales assistant.
Scott was then forced to have the "difficult conversation," but not on his terms. John told him that he was annoyed with Scott because, since he compensated the sales assistant and Scott did not, he deserved more of her time. John also felt that after years of having a working relationship with the sales assistant, they had a great routine. His perception was that Scott was always in crisis mode, demanding things immediately, and that this was disrupting to John's work flow. John was unaware that Scott felt that his repeated requests of the sales assistant were ignored.
As a consequence of this interaction, Scott was reassigned a new sales assistant. But the resulting negative feelings between himself, his original sales assistant, John and the branch manager left Scott feeling embarrassed and uncomfortable.
Why did the situation get out of hand? In part because Scott made some incorrect assumptions and failed to consider other viewpoints. Acknowledging all perspectives is critical to establish the necessary objectivity for reaching a successful outcome. Before we engage in a difficult conversation, we need to change our judging behavior to learning behavior and move from certainty to curiosity.
HAVING THE HARD TALK
In these situations, your goal should be to minimize the hurt, anger and guilt felt by all sides and to allow the parties involved to settle the matter with as dignity and insight as possible. Since everyone's perception is their reality, the process should start by having a conversation with ourselves. Instead of assigning blame, ask yourself what you can do differently to alleviate the problem. Remember, though, it can be quite difficult to remain objective when asking ourselves these kinds of questions. We tend to think irrationally when someonemaybe even ourselvesdoesn't live up to our expectations.
Once you think you've sorted out your own role and responsibilities in the conflict, it's time to initiate a conversation. Be intentional in your behavior and identify your ideal outcome prior to meeting with the other parties. Once the conversation begins, clarify the issues as objectively as possible by describing a specific behavior and providing factual data. Above all, do not attack the other parties on a personal basis. Listen non-defensively and try to hear and internalize the other person's perspective. Then generate a plan of action together, following up on the next steps in a timely manner.
The greatest challenge of engaging in a difficult conversation is living with the consequences of the outcome. While gaining the respect or the approval of your client, employee or colleague would be a great, far more important is the positive impact that initiating this course of action will have on your effectiveness as a leader and your business's bottom line.
PLANNING THE TALK
Before you sit down and have the hard conversation with a colleague or client, you need a game plan. Here are some steps to follow:
- Ask yourself what you can do differently to change the situation.
- Decide what you want to achieve prior to the meeting.
- During the conversation, provide objective observations and data about the problem.
- Do not attack the individual personally.
- Listen to the other person's point of view.
- Generate an action plan together
- Follow up with next steps in a timely manner.
Denise P. Federer, Ph.D., is a clinical psychologist, executive coach and founder of Federer Performance Management Group. She has been a consultant to the financial services industry for 25 years.
- How to Train New Advisors
- How to Explain Compensation to Your Clients
- Next-Gen Advisor Shortage Demands Hiring Reforms