Are you an expert financial advisor?
This is not a casual question. To the extent that you are able to look a prospective client in the eye and say with supreme self-confidence and truth, “I believe that you would benefit from our relationship because I am an expert in (fill in the blank)”, is pretty powerful stuff. Indeed, it might be one of the most potent marketing statements that you could ever verbalize or articulate.
Your expertise is why someone would want to work with you. You are an expert in something that they want and need, ergo it makes indubitable sense that clients should work with you. Your practiced and knowledgeable skills are one reason why clients should break their status quo, e.g. a discount broker, working with their brother-in-law, DIY, or with some other random advisor who has no/little expertise in what would truly benefit the client.
Of late, Malcolm Gladwell has written extensively (Outliers) on experts and expertise and the “ten-thousand-hour rule.” In turn, scientists who have preceded him have informed Gladwell. For example:
- John Hayes (Becoming the Expert), who studied seventy-six famous classical composers and found that, in almost every case, those composers did not create their greatest work until they had been composing for at least ten years.
- Forty years ago, Herbert Simon studied the chess experts and postulated that, on average, a grandmaster has spent perhaps 10,000 to 50,000 hours staring at chess positions.
What is an expert?
Expertise refers to the mechanisms underlying the superior achievement of an expert, i.e. "one who has acquired special skill in or knowledge of a particular subject through professional training and practical experience" (Webster's dictionary) The term expert is used to describe highly experienced professionals such as medical doctors, accountants, teachers and scientists, but has been expanded to include any individual who attained their superior performance by instruction and extended practice: highly skilled performers in the arts, such as music, painting and writing, sports, such as swimming, running and golf and games, such as bridge and chess.
When experts exhibit their superior performance in public their behavior looks so effortless and natural that we are tempted to attribute it to special talents. Although a certain amount of knowledge and training seems necessary, the role of acquired skill for the highest levels of achievement has traditionally been minimized. However, when scientists began measuring the experts' supposedly superior powers of speed, memory and intelligence with psychometric tests, no general superiority was found --the demonstrated superiority was domain specific.
The Tim Tebow Example
More lately, discussion around the “ten-thousand-hour” rule has revealed that attaining expertise is more nuanced than simply putting in the hours. A good example of this is the story of Tim Tebow.
Tim Tebow was one of the most successful collegiate quarterbacks ever. Most interestingly, he achieved this NCAA success despite one flaw. He couldn’t throw the football very well. In the NFL, his shortcomings were highlighted…despite his spending countless hours in the offseason to improve himself. We are talking workouts that lasted 10 hours daily and 6 days a week, i.e. hundreds of thousands of reps. If the “ten-thousand-hour” rule was always true, Tim Tebow would be leading his team to the Super Bowl. (He’s not.)
K. Anders Ericsson is an expert on experts and editor of The Cambridge Handbook of Expertise and Expert Performance He says that not all practice makes perfect. One needs a particular kind of practice…deliberate practice…to develop expertise. When most people practice, they focus on the things they already know how to do. Deliberate practice is different. It entails specific, considerable, and sustained efforts to do something you can’t do well, or even at all.
Practicing outside your traditional comfort zone of achievement requires substantial motivation and sacrifice. As golf icon Sam Snead once said, “It is only human nature to want to practice what you can already do well, since it’s a hell of a lot less work and a hell of a lot more fun.”
Find a Coach
There’s one more thing that Ericsson points to. Get a coach. He says, “The development of expertise requires finding a coach who is capable of giving constructive, even painful, feedback. Real experts are extremely motivated students who seek out such feedback. They’re also skilled at understanding when and if a coach’s advice doesn’t work for them…The best coaches identify aspects of your performance that will need to be improved at your next level of skill…”
This is a big topic, with a lot more to think about and discuss. For now, here are four questions for successful financial advisors:
- What is your definition “being an expert?”
- Where are you an expert?
- How does this benefit your clients?
- What actions are you taking to develop your expertise even further?
We trust this helps.