Executive Summary
It's a common financial planning challenge - the planner provides recommended action items for the client to implement, but the client struggles to follow through on them. In some cases, it may be because the client doesn't really believe the recommendations are best; in others, it's a matter of trust; but in most, it may simply be a matter of "buy-in" to the action items (or a lack thereof!) in the first place. After all, it's easy for a client to procrastinate about implementing recommendations if the client isn't really committed to them in the first place.
But as it turns out, just a few small changes to the process of delivering action item recommendations by inviting clients to physically write down part of their commitment can potentially increase client buy-in and follow through.
The inspiration for today's blog post comes from a recent book I have been reading, "Influence: Science and Practice" by Robert Cialdini. The book discusses various ways that "compliance experts" - i.e., individuals who are experts at getting others to comply with their wishes - exert influence and persuade others. While the book actually highlights some occasionally nefarious and inappropriate (or at least, rather immoral) influence techniques, it also discusses extensively the underlying psychological research that surrounds many of the ways our brains make decisions and are influenced, which can be used in positive ways as well.
For instance, a great deal of research has shown how writing down something we have committed to increases the likelihood that we will actually follow through on it; once we commit to an overt choice, we feel internal and even interpersonal pressures to behave consistently with that commitment, in part to justify the earlier decision. A study from the 1990s examined the phenomenon by separating volunteers for a charitable activity into two groups: the first group volunteered by completing a written form agreeing to be involved, while the second group agreed to volunteer by NOT completing an opt-out form that would have stated they didn't want to participate. Thus, in essence, the first group volunteered by writing down their commitment, and the second group volunteered by not writing down anything. The results were clear: when the volunteer day arrived, 74% of those who actually showed up were the ones who had written down their commitment. And notably, when asked to explain why they showed up, the wrote-it-down-first volunteers were more likely to explain their decision to volunteer based on their personal values, preferences, and traits... but NOT the fact that they had simply written it down, even though that was the only actual distinguishing difference between the groups! In other words, not only did it "work" to ask the volunteers to write down their commitment, but they didn't even realize the act of writing down their commitment was affecting them!
The reason writing it down appears to matter is that hardwired into our brains is a reluctance to reverse a prior commitment we have made; to the contrary, we actually feel a need to ensure that things we have signed our name and committed to will actually come true. In fact, research has shown that after casting a written ballot in a vote, we increase our belief and expectation that the candidate we voted for will win, in an attempt to ensure and convince ourselves that our prior action was "correct". The effect is even more extreme is we make our commitment public; many weight loss clinics have found that having weight-loss patients write down a weight loss goal, and show that goal to their friends and relatives (who will explicitly or just implicitly help hold the person accountable), dramatically increases weight loss success even for patients where most other techniques fail.
So how is this relevant to financial planning? The key point of commitment in the financial planning process is the recommended action items for the client, yet in reality the standard process is simply to deliver a series of already-written (or printed) recommendations to the client for implementation, without necessarily taking the steps to gather commitment and buy-in, especially a written commitment. Of course, just asking a client to put their signature at the bottom of a page of action items may feel corny, and asking a client to re-write a list of action items in their own handwriting seems gratuitous. But here are a few basic steps to consider, that may help clients get more buy-in and commitment to following through on their action item recommendations, without being over the top:
- When clients commit to a savings goal as part of an action item, leave the dollar amount blank and have the client fill in the agreed-upon savings plan. For instance, instead of giving a recommendation "Save $12,000 in your 401(k) plan at work in the coming year" provide the action item "I will save $_____ in my 401(k) plan at work in the coming year" and have the client fill in his/her own dollar amount commitment (albeit perhaps based on your recommended amount determined in the plan itself).
- Since recommendations often can't all be completed at once and must be prioritized, leave a blank space next to each action item and have the client write down the order they will be done as #1, #2, #3, etc. This way, the client overtly commits to the highest priority action items, in writing, increasing the likelihood of following through on them.
- In addition to having clients prioritize, leave a blank for a targeted "Completed By" deadline, and have the client write in a commitment for when the action item will be completed. This both helps to cement the commitment itself, and provides a timeline against which the client can be held accountable for that commitment.
- Make a copy of the action item page with written commitments; one copy goes with the client, and the other copy stays with you. In future meetings, pull out that piece of paper, with the client's written commitments on it, to check and see how the client is doing (and so that the client must confront his/her own written prior commitments). This simple act both helps to hold the client accountable to the commitment made to himself/herself, and creates an implicit pressure for the client to complete the action items to avoid the embarrassment of admitting to the planner that the client didn't do what he/she said would be done (in a similar manner to the personal trainer who holds us accountable to follow through on the exercise we commit to doing).
Of course, the purpose of the above steps are not merely to force or guilt the client into committing to recommendations and following through on those action items. The process of taking the client through written commitments of action items can itself provide a conversation opportunity for the client to either affirm or reject the recommendation itself. Clients who hesitate about signing off for some or all of the recommendations are implicitly expressing that they don't have buy-in to some part of the plan or process, which can be addressed directly. Clients who persistently push certain action items to the bottom of the list across multiple meetings may be revealing a lack of buy-in to that particular part of the plan. All of these issues can form rich conversations about the client's comfort level and willingness to adopt the plan, or whether it needs revisions because some goal was not captured correctly.
In the end, though, the research suggests that these simple steps of inviting the client to commit to action items by actually writing down (parts of the) goals, writing down prioritization, and writing down deadlines, and then being "confronted" with those written commitments in follow-up meetings in the future as an act of accountability, can dramatically improve client follow-through.
So what do you think? Would you adopt a more written process with your clients to help engage client commitment? What other ways could you integrate written commitments into your planning process to help facilitate client buy-in?
Google “advice’s missing link”. Use lifetick.com to work with clients. See more at the AICPA PFP conference. See you there.
Thanks Michael, this post is really helpful!
If any planner currently uses this technique (or similar), I’d be interested to know how you do it. I certainly like the idea of what Michael suggests, but when I envision it in my mind’s eye, I feel like I’d come off as pedantic, overbearing, untrusting, condescending, etc. So, I’m basically suffering from a lack of imagination here, as to how to do this in a way that a client will appreciate.
Meg,
I thought the point is to REALLY make the focus of the conversation client-centric. For example…
“This page lists some of the goals that I recommend, but ultimately it’s up to you to implement them (with my help). So I’d like you to have control over what we do first. Here’s the list and a pen – YOU put down the order that you think these should get done, and then we’ll work together to do them. We’ll want to set timelines to make sure they get done, too – but again, that’s your call to fill in what kind of deadline you want to commit to. Then it becomes my job to help you implement and hold you accountable to getting done what you said you wanted to work with me to get done!”
Or something to that effect. 🙂 The point is not to say “Here, you have to write this down in order to do it.” The point is to just put it in their hands, and make writing things down a natural step in the process. Otherwise, as you point out, it will come across as very pedantic and condescending.
– Michael
@Meg and Michael,
How would you see this process being adapted for planners who meet virtually (thus electronically) with their clients?
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Meg,
The key to incorporate what are coaching techniques into a financial advisory practice is to step aside from the expert or “advisor with the answer” frame of mind. People don’t resist change as much as they resist being changed. So, rather than the traditional diagnose & prescribe approach, it helps to guide clients to their own answers and solutions. Not having the responsibility for all the answers and solutions is liberating for the professional and empowering for the client. While that (misplaced) responsibility is what would make an advisor come across as overbearing and condescending. The client with the least knowledge is still the foremost expert on him/herself. Asking good coaching questions is what allows the client’s own expertise to be uncovered. Asking clients for permission is a good question to get acceptance for what you wish to say. For example: Could I tell you what has worked well for other clients? Well, some found that writing things down… Would it help you to schedule this task and have me follow up with you? (self-made decision, specific with accountability)
See the resources listed above in my short post. You may also want to google “do you know what is most important to your clients?”
I have found getting clients to prioritise actions to be a very successful method. I used to fall down in giving too many solutions to clients at once and I think I overwhelmed some of them.
Now I say “ok, there are a number of issues that we have to address over the next year, which are the most important to you?” We’ll then agree on a strategy to address these issues and a target date to have them completed. As the client is the one who is making the decision on which point is being actioned, they feel they have control and aren’t being railroaded into doing something they don’t want to do.
Michael,
Great post…this is built into our process in two ways. The first and most important is that we help clients to get very clear on their goals and objectives in each area of the planning process. We have found that this series of questions, tools and exercises really allows clients to visualize exactly the outcome they want in that specific area of planning…estate. investments, financial independence and business planning.
Once the client is crystal clear on their objectives then we show them exactly where they currently are and what the future of their current situation looks like. This allows the client to easily and efficiently recognize for themselves whether they are or are not on course to meet their stated goals and objectives.
We then frame each recommendation in relationship to the clients goals and objectives. So, as long as the recommendations truly fit the objectives there is never a reason for push back or a lack of buy in because the objectives are theirs. On the other hand, if the objectives are not clear to the client and /or the advisor is telling/selling the client on what they should be doing then the natural reaction would be to push back and or question WHY the recommendations are as such.
Finally, we utilize an implementation schedule that has a space called intended results. During the plan delivery we ask the client to write down what they believe are the intended results of implementing each recommendation. If they can’t remember we go back to the formula to quickly and easily remind them…This was your objective, based on your current situation this is why you needed to make a change and the intended impact is to help you achieve the aforementioned objective.
Over the years, it was very easy for us to see that if an advisor’s implementation was less than 100% then it was probably because they side stepped or all together skipped a part of the consultation process.
I believe this fits in well with Robert Caildini’s research.