When financial advisors must deal with powerful client emotions.
- In the behavioral sciences, an unconscious response based on your own experience is called "countertransference."
- Most financial advisors are not trained to handle their clients' complex emotional issues - but they often get roped in.
- Family business consultants, particularly those with a psychological background, are trained to manage issues of transference.
this: You are an accountant, a lawyer, a financial planner or a
technical professional. You are in a client's office, discussing an
issue. You understand the facts. You are probing for specifics and
suddenly the owner-entrepreneur gets up, closes the office door, sits
back down and looks at you with tears in his or her eyes. Are you the
How about this: You're part of a meeting with the
family members of a business. Something is said (maybe you said
something innocently) and suddenly voices rise, accusations snap back
and forth among family members. Are you the arbitrator?
I had an
accountant friend once tell me that whenever a client shut the door, his
palms started to sweat. He knew the client wanted to share something
emotional. When it happened, my friend felt unsure of what to say in
this scenario and unqualified for what to do.
Of course it was uncomfortable. He wasn't trained for it!
technical professionals are trained to deal with emotional issues,
humans in stress, boiling altercations. They are experts who analyze the
facts, make rational judgments and offer logical solutions. Handling
client emotions is not taught in business school.
another side to that coin: your own emotional response. As a technical
professional, you are not skilled at dealing with emotional/family
issues, nor are you trained to recognize and set aside your own. Good,
bad or indifferent, a client's emotional and family issues can trigger
an emotional response in you. Your family of origin and your experiences
filter what you take in from the client's emotional moments. Your
response may not apply or even be appropriate to the client's current
situation. But how could you know? You aren't trained for it!Countertransference
the behavioral sciences, an unconscious response based on your own
experience is called "countertransference." It means that without
knowing it, we project our experience onto our client. Or in the
opposite way, clients project their issues onto the technical
professional, becoming angry at you for unresolved emotional issues from
their past. This subconscious transference can create problems - for
you and for your client - particularly if you react. But then how should
you act? You weren't taught how to do it!
consultants, particularly those with a psychological background, are
trained to manage issues of transference. Emotional issues can occur
with any client. And they can occur even when the family business
consultant is a behavioral professional. But they also have the
preparation and experience to resolve emotional issues in a way that
adds value for the client.
You are probably already aware of the
clues to when it would be helpful to have a family business consultant
support your efforts. See whether you have run into these common
Clues that you've been asked to ride the elephant
| Situation|| Cause|| Handling|
| A client is suddenly angry when you bring up something you think is innocuous.|| The client may be reacting to unfinished emotional issues from the past
and transferring them to you as if you were that person from the past.|| You can begin by diffusing the situation. Apologize (even though you
don't know what you did). Explore from the client's perspective what was
so significant (objectionable, irritating). Stay calm; don't overreact.|
| You are in the middle of a discussion between a father and a son. The
father invites you to comment on his assessment that his son is "a lazy
bum" and not able to do his job.|| In cases much like this I have observed that typically there is no job
description, training or career plan for the next generation.|| You might suggest that a leadership plan should be created. It should
include psychological testing to determine an appropriate career and
leadership plan for the son. Having a trained family business consultant
would clearly add value to this situation.|
| Normal business or financial differences are eroding a father-son or family relationships.|| Business or family tensions are spilling over into family gatherings,
holidays or other events, perhaps prompting painful arguments over whose
idea is best (right versus wrong). Tension can progress to silent
suffering so that family outings activities are not "spoiled."||Supporting and even facilitating family meetings can do wonders to
strengthen person-to-person relationships. In fact, it has been proved
that when a family business has regular family meetings, they outperform
the S&P 5001. Family business consultants with a psychological
background conduct those meetings with ease. |
| Families have difficulty managing their differences both in the family and in the business.|| || Differences like this can soon become a business liability as well as a
family destroyer. Help with good communication by engaging the family in
brainstorming to consider the better parts of several ideas to create
the finest possible approach - one that no individual could come up with
on his or her own.|
1 Ernesto J. Poza, Family Business, 3rd edition, 2009.
major issue for many families and their businesses is a lack of
communication. This is a red flag that could mean it is time to bring in
a family business consultant who is trained in the area of family
communication. When poor communication skills go unchecked, family
members find it hard to collaborate and work as a team. Individuals are
often poor at expressing their feelings and wants, and they are poor at
listening. A trained professional can help individuals learn good
Another moment for a competent behavioral
professional comes during succession planning - a time you would think
is merely a technical, factual effort. And that's true in part. You help
the business resolve complex financial, tax, business planning, and
ownership and leadership issues. However, there are often (I would even
say usually) complicated family issues hiding in every succession plan.
Having a trained psychologically minded family business consultant adds
value to smooth and guide a succession plan's implementation. Here's an
Business differences were
eroding the positive relationship between a father and his son. They
were at odds over taking financial risks and growing the business. Dad
saw it one way; the son saw it another. But what they felt was a
father-son difference I saw as a business planning issue. I engaged the
father and the son in a strategic business planning process. In the end,
they mutually developed a completely different strategy to grow the
business that alleviated the father's concerns about financial risk
and that fed the son's excitement about leading a growing business.
In the next installment of this series
, we'll discuss Inside-Out Succession Planning
and how to broach the subject of bringing in a family business
Read Part Two - Are You Trained to Ride the Elephant in the Room?