ELITE ADVISOR BEST PRACTICES

Are You Trained to Ride the Elephant in the Room? - Part One

When financial advisors must deal with powerful client emotions.

By Tom Hubler

Key Takeaways:

  • 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.


Picture 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 therapist?

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!

Few 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.

But there’s 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

In 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!

Family business 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 situations.

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.

A 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 communication skills.

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 example.

Picture this: 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. Everybody won!

Conclusion

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 consultant.


About the Author

Tom Hubler (tomh@thehublergroup.com) is president of Hubler for Business Families (hublerfamilybusiness.com) and an adjunct professor at the University of St. Thomas. He can be contacted at (612) 375-0640.