CHRISISM #3 - Knowledge is Power (as long as you don't share it!)
10 November 2015
I don't want you to get the wrong idea - I definitely agree with the adage "Knowledge is Power", but not for the reason that you may think. More often than not knowledge is most powerful if you resist the temptation to share it with your clients.
In my experience the majority of clients want to feel comfortable that you have the knowledge, but at the same time there is a little voice screaming in their head saying:- "But please, please, please, please, please don't share it with me!" Once you have been in the business for a number of years, you will have obviously acquired an awful lot of knowledge about all sorts of technical and product related issues. Ask yourself this question:- "What percentage of all this knowledge that l have acquired does my average client want me to share with them?" I would suggest to you that typically the answer to this question would be less than 10%.
The 2 most common reasons why business doesn't happen when it could and should are either because you have not given enough information to a client for them to make an informed decision (and how likely is this when most of financial planning is common sense?!) or because you have given too much information to a client and they are suffering from information overload otherwise known as confusion. I would suggest to you that giving too much information is a much more common occurrence than not giving enough information, but whether that be the case or not, the more important issue is this: - which of these 2 potential problems is solvable and which one isn't?
The client having too little information is solvable - you simply have to provide more information as required, whereas information overload is not solvable because you can't take back information you have already given! My recommendation therefore is to keep things as simple as you can for your clients and only share enough information so that your client is able to make an informed decision. If they are more technically minded and need more information, then they will tell you and can provide the extra information they require.
So knowledge is power primarily because it gives you more confidence because, if asked a question, you will probably know the answer. However, what I have also discovered is that not knowing the answer to a question presents a great opportunity for you as well: - "That's an excellent question and I don't know the answer to it off the top of my head. However, i will find out the answer and get back to you." Then make sure you do this in a timely fashion, and this in itself will make a positive impression and have the effect of differentiating you as someone who can be relied upon.
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