Topic 13 - Justifying Client Objectives Flashcards
What are some examples of good communication?
Adviser responsibility to communicate with client in suitable way where they are comfortable.
Good communication helps to get to know client, establish needs and objectives and making suitable recommendations. For example:
- Active Listening - Paying attention and asking clarifying questions. Listening between the lines.
- Non Verbal - Body language and tone such as sitting upright, projecting voice, maintaining eye contact and smiling.
- Open Mindeness - Open to and listen to other viewpoints, beliefs and principles.
- Constructive Feedback - Thanking customer for time
- Confidence - Believe in what you’re saying.
- Friendliness and personalisation - Remembering personal facts and soft topic conversations
- Questioning - In addition to factfind, open, closed and probing questions should be asked to work out what makes them tick, what their objectives, needs and ambitions are.
- Acknowledging - Making clear to client they are understood, confirming details with them both verbally and non verbally.
- Using Clear Language - Suitable for client so they are comfortable and understand information.
What are the different categories of client?
COBS Section 9 to Know Your Customer
COBS Section 3 - Categorises customers as retail or professional and includes potential customers as well as new and existing customers.
Eligible Counterparty - Banks, Insurance and investment firms, governments who only need limited service such as execution only. Lowest level of investor protection.
Professional Client - Eligible counterparties who need higher level of service such as advice. Can assume they have sufficient experience and knowledge and can accept risks.
Retail Client - All that are not professional or ECs. Highest level of protection and only simple knowledge and understanding of financial services.
What is the Mehrabian’s Communication Model?
Statistical Research for effectiveness of spoken communications:
- 7% meaning is in spoken words
- 38% meaning is in way words are spoken
- 55% meaning is in non-verbal communication such as facial expression
What are the Differing Client Types you may encounter? What traits might they have and how should the adviser adapt him/herself to these?
Able to adapt to various clients to built trust and better understand their objectives.
Tough/Competitive
Assertive who likes winning, recognition and challenge. Avoid losing at all costs
Self confident, tell you what they want, focussed on goal, pride in appearance and test technical knowledge.
Adviser should be clear of process, the benefits, show an interest in their objectives, praising, pacey discussions, be on time and well presented.
Helpful / Friendly
Enjoys relationships, being part of team and in comfortable helpful environment. Avoids conflict.
Will be chatty, warm conversation, not in a rush, open, show interest, relaxed, want to develop a relationship,
Adviser should try to build relationship, confirm they will take time to know the client, show they trust the client, use positive emotions and be open and honest and sharing with information and themselves. Give reassurance to guide and support client in achieving outcome.
Analytical/Logical
Likes honesty, structure and order and will avoid chaos or disarray.
Will be prepared and organised, punctual and habitual. Will have clear objectives, respond well if discussion is structured, like evidence and will ask questions.
Adviser should be punctual, break down process and set agenda, explain benefits and risks in more detail, use less emotion and more evidence.
What are some ethical standards advisers should adhere to?
- Act honestly, fairly, client’s best interests
- Act with integrity
- Observe laws, regulations & professional conduct
- Managing conflicts of interest fairly
- Attain and maintain level of professional competence
- Not engaging in activities if not competent.
- Uphold high professional & personal standards
