When Efforts To Persuade Backfire
September 15, 2015
by Dan Solin
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In my article last week, I noted some of the similarities between lawyers and financial advisors. Both face the formidable task of persuading others to adopt their points of view. Lawyers need to persuade clients to retain them and persuade judges and juries to adopt a position that is favorable to their clients. Advisors need to persuade prospects to become clients.
Given the importance of these goals, it’s surprising that so little attention is paid to how to achieve them. In my prior experience as a trial lawyer and in my current role as a coach to advisors, I’ve found that most attorneys and advisors spend a significant amount of time preparing the substance of their presentation but ignore the data on presentation skills.
A recent study by Kathryn Stanchi, a professor of law at Temple University’s Beasley School of Law, addressed the issue of when efforts to persuade cross over into “obnoxiousness.” She noted that “the line between persuasion and coercion is a fine one.”
One issue raised in this study should be familiar to advisors: How do you deal with arguments contrary to your position? Do you ignore them? Do you dismiss them as spurious and not worthy of discussion? Do you address them and deal with them in a serious and analytical manner?
Moderation trumps zealousness
Let’s take a situation familiar to advisors. Your prospect tells you she is confident that she can “beat the market” through stock picking, market timing and selecting outperforming actively managed funds. You possess a wealth of information that contradicts her view. How should you present it?
Professor Stanchi found that a moderate approach trumps zealous advocacy. In this situation, she recommends voluntarily noting that some investors do “beat the market” every year, but the chances of doing so are so small it makes little sense to try. She concludes that “you are better off acknowledging your flaws than ignoring them, and you should address why your message should be accepted despite those flaws.”
This approach will likely be more successful that engaging in a glib, dismissive discourse that could be perceived as “scorched earth” advocacy.