Journal of Financial Planning: December 2014
Ross Levin, CFP®, is the founding principal of Accredited Investors Inc. in Edina, Minnesota, and author of Implementing the Wealth Management Index. Email author HERE.
I was going to a regular meeting with a room full of business people, many of whom I knew. When I awoke that morning, I thought about which suit I should wear, which car to drive, and who I could potentially sit by. I suddenly realized that I was watching myself be myself instead of just experiencing the present moment.
I was thinking about this as it relates to our business, our transition planning, and my client interactions. When I make myself or someone else an object—president of the company, a prospect, an employee—rather than a fellow human being, I lose the opportunity of a real connection. I essentially give myself up in order to gain something that may not be authentic to who I am.
When I walk into a room of business people and am more concerned about how I will fit in, I am as far from the concept of flow as I can imagine. I view my strengths aggressively in terms of how can I impress rather than with kindness and compassion.
Philosopher Martin Buber said, “There are three principles in a man’s being and life: the principle of thought, the principle of speech, and the principle of action. The origin of all conflict between me and my fellow men is that I do not say what I mean and do what I say.”
When I am trying to impress someone rather than be in a relationship with them, I am creating a conflict between who I am and who I am showing myself to be. Inevitably, that conflict has to be played out—either through internal disharmony or external conflict. How can anyone get what they want if they do not bring themselves to the engagement?
Change Your Thinking
As we broaden ownership of our firm, I have had to understand many things about my motives. Our firm has around 40 people. My founding partner and I are in our mid-50s, and we own around 90 percent of the company. As I look at my personal objectives for broadening ownership, I realized I have several masters to serve: clients, future owners, other employees, my family, and myself. The question I have to ask is, how can I best align these sometimes competing interests? I think that my answer is to not treat them as objects but instead as relationships.
This changes my thinking. Relationships are expansive; they create abundance. Trust, love, and belief are not depleting assets. They are regenerative. They are sustainable.
I want to broaden ownership so that our clients will benefit. People for whom we provide advice will know that they have relationships larger than any individual. Those who invest in the firm know that those selling their shares want the buyers to succeed. Individuals performing good work understand that they have an opportunity to earn a nice living, build their net worth, and engage in meaningful activities. My family and I will be able to enjoy an integrated life, and I can continue to work as long as I add value.
All of those objectives are possible, but only through a relationship. A real relationship is only possible through right thought, speech, and action. If I am more concerned about what I am getting, then I am going to set a price for the firm that is more than the buyers can withstand. If we don’t create an environment in which people working here feel fairly paid and reasonably challenged, then we will have more turnover than those entrusting their futures to us will tolerate. Everything is interconnected and interdependent.
An Exercise in Profit Sharing
We formed a profit-sharing task force to determine how we can distribute a percentage of the growth of the firm. The conversation was complicated, because there were many pieces that came into play. Does everyone get the same percentage of their salaries regardless of their performance? Does tenure matter? What is a reasonable percentage for people to receive?
Once we could agree on the larger picture, things fell more in line. We wanted salaries to be high enough so that people felt fairly compensated for the work that they were doing. We wanted to manage better so that people who were not good organizational fits would be able to find better homes.
Handling those two items helped people be more comfortable with profit sharing as a percentage of income rather than performance based.
We understood that firm profits come about due to good work over long periods of time. That enabled us to incorporate tenure in the formula.
We also understood that at times the revenues of the firm can vary due to market performance. The expenses of the firm were primarily driven by staffing. We created a range for the profit-sharing bucket to be funded based on salaries as a percentage of revenues.
What was most interesting to me was that some of those on the task force were arguing against their own self-interests. Why? Because they understood that ultimately they would benefit by others benefiting. They believed in abundance rather than scarcity.
The hardest part about these discussions was understanding from where people were coming with their positions. Our progress was completely impacted by the openness of the group. Arguments would be made for or against a particular way of doing things, but we could not get clarity as to why those arguments were being made. We were not being open with each other. I think the real reason for the lack of candor was distrust—either within the group or within ourselves.
Align Thoughts and Actions with Values
When I am concerned about being open with someone, it comes from what I am afraid I may lose. Maybe they won’t like me, respect me, or trust me. But when I am not open with someone, I am holding on to an illusion.
When people (I am trying to not use the term “prospects” to avoid objectifying them) interviewed the firm, I would write them a note after our meeting and that was it. We began to lose prospective relationships to a firm that had a full-time business development person. I didn’t want to reach out to people with whom I met because I didn’t want to pester them or because I just wanted them to know that our firm was the right fit for them. That reasoning sounded great, but it was a lie. I wasn’t reaching out because I was too fragile to hear no. If I believed that we were the best fit for certain people, then shouldn’t I let them know how much I wanted to be in relationship with them? Ultimately, my selfishness in the form of self-protection was causing a surrendering of my beliefs. I became excellent at justification rather than excellent at risking rejection. I have consciously changed my behavior to cohere with my values.
Aligning our thoughts, speech, and actions with our values is an internal job. It means that we don’t blame others for our situation, but look directly at ourselves. We don’t need to punish ourselves to effect change, but we need to be aware of our behaviors. When I say that I was acting selfishly and protecting myself by not doing follow up, I am describing my behavior, not judging it. I want to be aware of what I am doing that is getting in the way of living the life I want to live. I will make mistakes, but reflecting on them creates possibility; ignoring them stunts it.
Ultimately, I ended up walking into that business meeting less anxious because I was aware of the mental tricks that I had played. I quit looking for a result, and instead chose being in relationship.